economic instability aside , perhaps the chief concern for hoteliers is the influx of new inventory . Expected increases in the costs of labor , energy and commodities pose additional challenges .

An August 2011 report by JLLH China and the China Tourism Hotels Association found hoteliers across the country expected average RevPAR growth of 12.2 % in 2011 , showing stability following a 13.6 % jump in 2010 after the market ’ s nadir in 2009 . China ’ s overall demand outlook remains strong behind continued growth in corporate travel that is spurring a strategic shift from occupancy- to ADR-driven revenue growth , according to JLLH China .

The Chinese government committed to tourism as a focus of economic growth within the country ’ s 12th Five-Year Guideline , which establishes state priorities through 2015 . An aim of the guideline is to enhance China ’ s consumption-driven economic growth , which should accelerate expansion of the burgeoning domestic travel market .

Do domestic hotels have an advantage over international brands among Chinese consumers ? Not in the upscale and luxury levels . “ The Chinese are very brand-conscious ,” says Nigel Summers , director of Horwath Asia Pacific . “ Wealthy Chinese travelers know the international brands ; over the last 10 years , they ’ ve traveled well all over the world .”

As in many markets ,

cultural differences in China give Western hoteliers fits during the ramp-up stage . IHG for two years has been planning a new upscale brand for the China market , which will launch in late 2012 . The new brand will have an impressive lobby , and its main restaurant will be “ more Chinese ” and will have additional private dining rooms . “ We describe the new China brand as a hotel that truly reflects the needs and attitudes of contemporary Chinese businesspeople ,” says Keith Barr , IHG ’ s Greater China CEO . “ The brand provides a familiar environment where they can

do business their way , whilst benefiting from the consistency in standards and service they expect from the world ’ s biggest hotel company .”

Wyndham Hotel Group — which has 17 brands — sees no need to add a China-specific 18th brand , says Asia Pacific President and Managing Director Ken Greene . “ We need to adapt each of our brands to the local marketplace . There shouldn ’ t be a China-specific brand ,” Greene says . “ It is grander in China across the board . In the 5-star space , the product is a star to a star-and-a-half higher than you ’ d get in the United States .”