Oyo Expands Into Food & Beverage

Oyo on Thursday announced its foray into the food and beverage (F&B) segment, with plans to roll out in-house kitchens and quick service restaurant (QSR) carts at 1,500 of its company-serviced properties by fiscal 2026. 

Townhouse by Oyo is the first brand to receive these services.

This decision was made following a pilot program that began in January in 100 hotels across several cities including Delhi, Bengaluru and Hyderabad. Oyo reported that feedback from the pilot was positive. This led to the decision to expand the program. The Oyo App and other booking platforms will allow guests to order food by selecting the “Kitchen Services”.

Oyo projects that these services will drive 5–10% additional revenue per hotel. This can increase margins for budget hotels with low room rates.

F&B and Indian Hospitality

Food and beverage service revenue has risen to become a major contributor to hotel revenues. Today, F&B contributes between 35%-50% of total income for many properties, especially those in upscale and full-service segments.

Hilton has said that F&B accounts for 35–40% of its revenue in South Asia. India is a market where food and drink offerings are becoming increasingly important. Alan Watts, Hilton’s president for Asia-Pacific, had told Skift earlier.

The main drivers of this growth are walk-ins, dining at destination restaurants, and Meetings, Incentives, Conventions and Exhbitions.

The demand for hotels is real in smaller, less-known suburbs. It is due to the increasing consumer and trade patterns. Consumption of food and beverage and banqueting have gone through the roof,” Jaideep Dang, managing director, Hotels & Hospitality Group at JLL, had told Skift earlier. 

This shift reflects the increasing demand for good food whether diners order in or out. Qmin, the food delivery app from IHCL, is an example. The app offers food from Taj hotels and supports real-time trackers. It also allows guests to place orders from multiple restaurants with a single order. Qmin enabled IHCL to remain relevant throughout the pandemic. This app, developed in collaboration by Tata Digital, allows for multi-restaurant ordering and personalization.

Radisson’s new dessert, Meetha By Radisson, as well as its global culinary launch are part of this trend.

Last year, Delhi government The Delhi Aerocity, a hotel and restaurant hub near the Delhi Airport, will be able to run restaurants 24 hours a day.

What Oyo Has to Offer

With its Townhouse Café brand, Oyo is targeting affordable and convenient dining options in the midscale and budget hotel segment. The offer will include continental staples, regional meals and ready-to-eat food through QSR carts and lobby stores. It is aimed at guests on the go, late night travelers and those who are looking for snacking options.

Oyo installs either a full kitchen or a smaller pantry, depending on the infrastructure of each hotel.  

“To support this, Oyo is developing a network of trusted F&B experts in key cities such as Delhi, Mumbai, Bengaluru, Hyderabad, Pune, Indore, Kolkata, Jaipur, and Lucknow,” Oyo Chief Operating Officer, Varun Jain, said.

Oyo is a major player in Tier 2 cities and Tier 3 cities where there are few branded restaurants.

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