Pros and cons of Club Mahindra
Timeshare memberships can lower your holiday costs and give you access to even international destinations, but there are a few obstacles that stand in your way.
If you’re confident that you’ll be taking a holiday every year with your family, a Club Mahindra membership is worth deliberation. For a sizeable membership fee today, its timeshare model allows you and your family to take week-long holidays every year for 25 years at a cost that it claims is ‘inflation-free’. This isn’t entirely accurate, of course, as you need to pay a fair bit of money as membership fee annually that, in fact, rises with inflation. Discerning consumers wouldn’t be surprised by this. If it’s too good to be true, there must be a catch. But is this Club Mahindra’s only problem? We reveal them all, as well as its many benefits, and tell you what kind of traveler would benefit most from membership:
First, the pros:
Not inflation-free, but cheaper Club Mahindra isn’t inflation free, given that you need to pay a service fee which is tied to inflation. Currently, depending on the type of membership, you need to pay Rs11,000 to Rs21,000 per year to keep your holiday going. Now, if you’re looking at Club Mahindra as a way to save on holiday, this may sound steep. You need to think of it as a way to save on a luxury holiday. Club Mahindra hikes its maintenance fees annually, usually by about 10%, but luxury hotels tend to raise their prices by a lot more annually. Furthermore, every year, Club Mahindra adds new hotels you can visit to their roster. While the tally was 27 a couple of years ago, it’s over 40 resorts today.
Family holiday While travelling as a family, you usually have to book two rooms or adjust in a single room with an extra mattress. With Club Mahindra, however, you either get a studio, one- or two-bedroom apartment. So the entire family will be able to stay in a single apartment. Moreover, in rooms that have kitchenettes, you could cook your own food.
Foreign holidays If you’re travelling abroad, it’s quite likely you stay at budget hotels. With the rupee taking a tumble, this will only become more of a reality for most of us. With an RCI membership, which comes (included in package for first two years, chargeable thereafter) as an add-on, you can live in luxury locations the world over. If you book well in advance, you may well be living in resorts comparable to the ones Club Mahindra has built here.
Plan early, save big: The trick to benefitting from Club Mahindra membership is to plan well in advance. This is particularly true for those who have cheaper memberships because there’s more competition for room among the two cheaper membership tiers. But if you’re willing to book well in advance, you’re likely to find room at one of your top choices.
Not enough room: Club Mahindra is constantly increasing its resort count (both here and abroad), but the problem is that it’s always adding customers as well. The last time for which figures are available (October 2012), the company disclosed that it has 151,000 members with a room inventory of 2276, which means that it would only be able to accommodate 118,352 (2276×52) members in a given year. Addressing the shortage of rooms in an investor call in April 2012 you can find here, CEO Rajiv Sawhney even said that ‘Typically, 70% or so of all members exercise their right in a given year.’ If you are a member, you might certainly be left fuming by such a statement if you’ve been left frustrated at the lack of room even after planning months in advance.
It’s not members only: Sterling Holidays and Club Mahindra rent out rooms to non-members as well. In Club Mahindra’s 2010-11 annual report, for example, the company reveals that it earned Rs15 crore from renting out rooms to non-members. This means that not only do they have more members than room inventory for the year, they also give rooms out to non-members. If you are a member trying to book a holiday and are rejected, try calling back as a non-member and then see if you can get a room.
Varying facilities: Don’t expect all hotels of even the properties Club Mahindra owns to offer the same luxury. Its resorts in Goa and Koorg, for example, have received RCI Gold Crown status, but many of them haven’t. Of the two resorts in Goa, for example, one has two swimming pools, a gymnasium and a spa, while the other has one pool and no gym or spa. Also, while agents often oversell the fact that you can cook your own meals in a kitchenette that’s in every room, many rooms are without this facility. If Club Mahindra’s rooms are fully booked, customer services will recommend you holiday at one of the affiliate resorts. Even though you’ve paid the more expensive Club Mahindra rates, you could be staying at a cheaper Sterling Holidays resort, as it is also an RCI affiliate.
Holidays abroad cost extra: Club Mahindra now has resorts in nearby foreign destinations, such as Dubai, Bangkok, Malaysia and Pattaya. But it also advertises its RCI affiliation, which gives you access to 6,500 resorts worldwide. There are three problems with this. Firstly, the initial package gives you a two-year membership to RCI. From the third year, you’ll need to pay Rs15,000 to Rs25,000, depending on your membership, to extend your membership every two years. To add to this, RCI has over 3 million members vying for the 6,500 resorts.
Whether or not the pros outweigh the cons depends on your holiday preferences. If you are in the following category, the chances that you will benefit could be high:
1. If you are certain you will want the Club Mahindra experience every year for 25 years.
2. If you are willing to plan your holidays well in advance.
3. If you are planning to get a cheaper membership (white or red), you are fine with taking a week-long holiday in the lean season.
4. You realise that Club Mahindra gives you luxury accommodation at a good price, rather than inflation-free holidays.