After acquiring overseas brands, the real challenges for Chinese hotel groups have only just begun.
What is lacking is not resources, but the organizational design that converts resources into global capabilities.
By Wang Datian, a technical practitioner in the preparation of asset-light hotel brands with more than 20 years of experience in the hotel industry, who has long been focused on the structural transformation of China's hotel sector, sustainable supply chains and the globalization of local brands. This article is the author's industry observation, which does not constitute a legal evaluation of the enterprises mentioned in the text, nor does it represent the position of TravelDaily.
Over the past ten years, Chinese hotel groups have closed multiple M&A deals in Europe. The closing date is always full of fanfare: group photos, champagne, press releases, and several Chinese names appearing on the guest room count rankings. When the hustle and bustle dies down, the real problems surface — who will define these acquired brands in the next stage? A few years later, can the original management team still be retained?
In the global hotel group ranking of *HOTELS* magazine, Huazhu and Jin Jiang have both ranked among the top in the world in terms of number of guest rooms. In the past two decades, China's hotel industry has completed the scale expansion path that took international brands 50 years through mergers, acquisitions and franchising, which is a rare moment of global leadership for China's service industry.
However, the number of guest rooms can be bought and counted. The supply chain bargaining power, member base and capital access brought by scale are real advantages, but globalization requires answers to other questions: whether the acquired brands can be effectively integrated, whether global capital trusts you, and whether your governance and culture can be understood by the world. These issues do not depend on the number of guest rooms, but on a deeper set of things. The author calls it "organizational genes": the stable mode for enterprises to make decisions, allocate power and process information. Scale is the result of gene replication, while globalization is the re-adaptation of genes.
In the second half of the globalization of Chinese hotel brands, there are three lessons to make up for. Instead of asking "What did we do wrong", it is better to ask "What else can we do". Behind the three lessons lies the same capability: encoding the organization's systems into a language recognizable by the global ecological niche.
Lesson 1: Governance Lesson — Integration Capability Is the First Threshold After M&A
In the history of international hotel M&A, integration has two outcomes. One is that the brand "disappears under management": expansion stagnates, teams leave, the brand's edge blurs, the scale enters the financial statement, but the soul stays in its original place. The other is that the brand is "activated": the parent company provides capital and channels, the brand retains its own governance structure and standard system, the synergy is gradually realized, and the brand grows stronger. Thailand's Minor Group's acquisition of Spain's NH Hotel Group and Fosun's investment in Club Med follow the latter path: the management team remains in place, the headquarters is retained, the brand operates independently, and the parent company empowers rather than takes over.
The dividing line between the two outcomes does not lie in nationality, but in the "governance gene" — whether the parent company can tolerate a brand that is "not fully controlled", and whether it can turn the statement of "respecting brand independence" during the acquisition into a system written into the governance structure. If the retention is written into the independent board of directors, the brand standard veto right, and the clear division of decision-making power, it is institutional; if the retention only stays at the gesture level, it is only a matter of time before power is reclaimed.
Chinese groups also have successful samples. After Huazhu acquired Deutsche Hospitality, it retained the European genes and local management of brands such as Steigenberger (the international segment has been fully led by local German professional managers since 2025). In 2025, the adjusted EBITDA of the international segment turned positive for the first time, reaching about 500 million yuan. The integration has entered the harvest period, but it has experienced the throes of store closures and restructuring in the process. Jin Jiang's integration of Louvre Hotels Group and Radisson follows the model of "local front office and shared back office": the brand front office retains local teams, while the back office of technology, supply chain and members shares the group's capabilities. Whether to isolate or integrate depends on the brand level: luxury brands need more independence, and mid-to-high-end brands can be integrated more deeply, there is no one-size-fits-all answer.
These capabilities do not grow out of thin air. Huazhu can export efficiency and membership system to Steigenberger, and Jin Jiang can export supply chain capabilities to Louvre Hotels Group, all relying on organizational capabilities that have been repeatedly verified in the Chinese market. Capabilities verified locally are the genes for overseas output.
Integration capability can be developed in practice, provided that there is a group of operators who can understand both the language of the headquarters and that of overseas brands. These people cannot be bought ready-made from the recruitment market: they are either inherited through M&A, or cultivated through a long-term international rotation pipeline, both of which require advance layout. For Chinese groups, how to digest the next M&A had better be designed in the transaction structure, rather than waiting for running-in after the closing.
Lesson 2: Trust Lesson — Verifiable Disclosure Is the Admission Ticket to Global Capital
When international capital decides how much premium to give a hotel group, it looks not only at the financial statements, but also at ESG, that is, the disclosure quality of environment, society and governance.
The ESG reports of Chinese hotel brands have become thicker and thicker over the years, with some exceeding 100 pages. However, the first measurement standard for rating agencies to measure disclosure quality is "boundary transparency": who is covered by your data? Does it only cover directly-operated stores, or does it include hundreds of thousands of employees in the franchising system? The author has conducted a content analysis on the 2023-2025 ESG reports of 13 hotel groups (9 international brands and 4 local brands), and found that all the reports of the 4 local brands only count directly-operated employees in the S dimension, while the E dimension of the same report often expands the store scope to all stores. It needs to be noted that the lack of franchisee data is a common industry problem in the asset-light hotel model, and international brands are also stuck in the supply chain data of franchisees; local brands only have a higher proportion of franchises and a later start, so they are more concentratedly exposed under the scoring caliber.
To put it plainly: the ambiguity of the disclosure boundary is more of a gap in system encoding, not a moral issue. Environmental responsibility can be solved through engineering means, such as energy-saving renovation and green power procurement; employee responsibility requires "institutional visibility", such as including franchisee employees in statistics, establishing appeal mechanisms, and accepting third-party verification. International brands have high disclosure transparency not because they are more morally noble, but because the EU's labor law, trade union system and mandatory disclosure regulations have "forced" them to complete the encoding.
Back to the operational level: full-caliber statistics of direct operation and franchising, and the introduction of third-party verification are the admission tickets to enter the vision of international capital. Whoever completes this step first will get the trust premium first. The standards have actually been written, what is lacking is execution.
Lesson 3: Narrative Lesson — China Has No Shortage of Governance Materials, But Lacks a Translation Layer
There is also a more subtle problem: whether governance and culture can be clearly communicated.
At the national level, the principles of extensive consultation, joint contribution and shared benefits, the Global Development Initiative and the Global Governance Initiative are being heard by the world. At the enterprise level, China's hotel industry actually has real governance materials: the workers' congress and trade unions are real institutional carriers, industry association standards have been formulated, and the "Oriental Hospitality" has decades of operational accumulation. However, looking through the brand whitepapers and ESG reports of leading groups, these materials are rarely translated into internationally verifiable and perceptible languages. There is no internationally universal menu for a table of delicious dishes.
Some people in the international community have made this happen. Shangri-La's "Asian Hospitality" is a translation project that has lasted for half a century: translating "we are very hospitable" into trainable and verifiable operating standards, translating Asian collectivist care into "warm care" in the international context, and the "residue" that cannot be translated has instead become the brand premium. Aman and Hoshino took another path: they do not translate governance, but translate aesthetics.
Changes have already taken place in Southeast Asia: Jin Jiang has reached a strategic cooperation with Malaysia's RIYAZ, which has specially set up RJJ Hotels to undertake the business, and plans to deploy 180 projects in 6 countries in five years; Huazhu is also promoting the landing of dual brands in Southeast Asia. These cooperations embed "local cultural adaptation" into the business model. The market has perceived the demand for translation before the brands, but there is still a gap from the systematic translation project like that of Shangri-La.
The translation layer can be split into mechanisms. According to public reports, Shangri-La relies on a brand committee to take overall control of standards, and regional cultural officers to translate the concept into executable actions for different markets. Chinese groups do not need to start from scratch for reference: translate "Oriental Hospitality" into trainable operating standards, translate the workers' congress system into an employee participation mechanism recognizable by international ESG standards, embed the translation function into the existing strategy and brand lines, and clarify the reporting line to the board of directors and system output, which is enough.
The "translation layer" is currently the most vacant part, and also the part with the greatest first-mover opportunity. Whoever builds it first will first define the grammar of "Chinese hotel brands" in the international context.
Recognize the Cost, So As to Design a Mechanism to Bear the Cost
All three lessons come with costs. The cost of the governance lesson is synergy loss: the more brand independence is retained, the slower the synergy of procurement, membership and channels will be realized. Minor took nearly ten years to integrate NH; the profitability of Huazhu's international segment also came with the throes of closing loss-making stores, reducing costs and increasing efficiency. Both fast and slow are correct options, the key is who determines the speed: the transaction structure, or the cultural running-in? The cost of the trust lesson is franchisee resistance: full-caliber disclosure requires franchisees to cooperate in submitting data, and their first reaction is often concerns about cost and privacy. The cost of the narrative lesson is "translation turning into public relations": if the translation layer has no system output, it is just a new signboard for the public relations department. Putting these costs on the table is not to find reasons for stagnation, but to let the promoters know where the obstacles are and how to design the mechanism.
Conclusion
The three lessons point to the same thing: the globalization of Chinese hotel brands is moving from the first half of scale expansion to the second half of capability building. The first half relies on capital and speed, and the rankings have been determined; the second half depends on the evolution of organizational genes, and today's governance structure is determining the rankings of the second half.
International hotel groups have spent decades completing this evolution, and Chinese brands do not have to retake the old path. Here we have the most complete supply chain, the most dynamic consumer market, the national narrative that is being heard by the world, and a group of enterprises that have already stood in the global first echelon. What has never been lacking is resources, but the organizational design that transforms resources into global capabilities.
This article is from the WeChat Official Account "TravelDaily", written by Wang Datian, and published with authorization by 36Kr.