Core Viewpoint - The incident involving the 7 Days Inn at Taiyuan Airport South Station highlights serious issues regarding fire safety compliance and brand management within the hotel industry, raising concerns about the integrity of franchise operations and the responsibilities of brand owners [1][3][6]. Company Summary - 7 Days Inn was founded in 2005 and went public in 2009, later privatized by Plateno Group in 2013, and subsequently acquired by Jinjiang International in 2015, becoming part of one of the largest hotel chains in China [1]. - The current operator of the implicated hotel has filed a lawsuit against 7 Days Inn (Shenzhen) Management Co., Ltd. and its former shareholders for failing to provide necessary fire safety certifications [1][3]. - The hotel operator claims that upon taking over the hotel in May 2023, they were assured that all necessary permits were in place, yet discovered that the fire sprinkler system was not connected to any water supply [3][5]. Industry Summary - Jinjiang Hotels has accelerated its expansion in 2024, opening 1,515 new hotels, bringing the total to over 13,000, despite facing a decline in revenue and net profit, with a revenue of 14.063 billion yuan, down 4% year-on-year, and a net profit of 911 million yuan, down 9.06% [6]. - The average daily rate (ADR), occupancy rate (OCC), and revenue per available room (RevPAR) for budget hotels, including 7 Days Inn, have all seen declines in 2024 [6]. - The legal responsibilities regarding fire safety in franchise models remain ambiguous, with existing laws not clearly delineating the responsibilities of brand owners and franchisees, leading to potential gaps in oversight [9][10][11].