Hotel Firms Research Articles

The impact of capital structure on financial performance - an empirical study at hotel firms in Hanoi

The article examines the impact of capital structure (CS) on financial performance (FP) of hotel firms. A sample size of 72 of 3 - 5 star hotel firms in Hanoi city, Vietnam in a period of 3 years from 2016 to 2019 has been taken to analyze. Firm FP is measured by ROA, ROE, ROS. The study which applies quantitative methods along with the support of EVIEWS software points out a statistical significance relationship. Firstly, the CS has a contrariwise impact on ROA but no effect on ROE and ROS. Secondly, among control variables (asset structure, expenditure ratio, revenue), the expenditure ratio is the only one showing a contrariwise impact on ROS and the rest has no statistical significance

Internationalization and Sustainable Hotel Competitiveness: Resilience and Network Ties to Increase Tourism Sustainability

The tourism industry, which is exposed to a turbulent environment, is one of the sectors that are the most vulnerable to any change (such as political, economic, environmental, or social). This makes it necessary to study firm resilience in this industry in order to identify the factors that can enhance companies’ capacity for resilience in turbulent environments. Moreover, the strategies pursued by tourism companies to become more resilient and more competitive are closely related to tourism sustainability. Among the factors that can affect resilience, we analyze the roles of the degree of internationalization and network ties. Moreover, we explore the influence of resilience on the sustainable competitiveness of hotel firms. For this purpose, we propose a variance-based structural equation modeling analysis where resilience acts as a mediating variable between the degree of internationalization and sustainable competitiveness. Our results allow us to draw important theoretical implications, which shed light on a field of study that is currently much debated, and practical implications, which will help hotel entrepreneurs to make timely decisions in dynamic environments.

Green transition in the hospitality industry: The influence of market forces and customer dynamics on sustainable performance in the digital era

In recent years, the ongoing environmental challenges have caused hotel firms to experience stress from stakeholders (i.e., customers and competitors). These stringent ecological changes have compelled hospitality firms to go green. This study investigates the influence of customer and competitive pressures on green innovation and sustainability in the hospitality industry. Utilizing a sample of 309 employees from multiple hospitality companies, the study rigorously tests a series of hypotheses using Smart PLS and Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings supported all the hypotheses, indicating that customer and competitive pressures significantly foster green product and process innovations, enhance sustainable firm performance, and encourage green CSR initiatives in the Chinese hospitality sector. Furthermore, green product innovation, green process innovation, and green CSR were found to be critical mediators in enhancing firm performance under the influence of these pressures. These results have substantial implications for theory and practice, highlighting the importance of external pressures in promoting sustainable practices in the hospitality industry.

Does climate policy uncertainty influence corporate cash holdings? Evidence from the U.S. tourism and hospitality sector

We examine the influence of climate policy uncertainty (CPU) on corporate cash holding decisions of U.S. tourism and hospitality firms. We find that CPU is negatively associated with corporate cash holdings for tourism and hospitality firms in the United States. A further analysis indicates that the impact of CPU on cash holdings lasts 2 years and disappears afterward. We also show that CPU is negatively associated with corporate cash holdings for hotel firms, but its impacts on airline, restaurant, and casino firms are insignificant. Results from cross-sectional analyses show that financial constraints and climate risk exposure moderate the relationship between CPU and corporate cash holdings. Our main findings are insensitive to additional robustness tests, including an instrumental variable test and subsample analyses. Our results have timely implications for academics, investors, and regulators.

Improving Hotels’ Operational Efficiency Through ESG Investment: A Risk Management Perspective

Though environment-social-governance (ESG) practices are increasingly prevalent in the business world, academic research about the impact of ESG on firms’ efficiency remains in its infancy. In this study sampling 24 international hotel firms during the period of 2013–2019, we examine how ESG standards improve these hotels’ operational efficiency obtained via data envelopment analysis (DEA). We further investigate how ESG can help manage a crisis by examining the period before and after the COVID-19 pandemic. Our results reveal that ESG can indeed enhance hotels’ efficiency. Specifically, the social and environmental aspects are the most important factors that contribute to the operational efficiency of hotel firms. In the context of the COVID-19 pandemic, hotel firms with the best ESG practice can be more efficient than others, especially those that have very high environmental and social scores. Overall, our findings suggest that hotel firms should consider ESG investment, not only as an effective and sustainable strategy during normal times but also as a crisis management strategy to overcome unexpected crises that may arise in the future. Funding: This work was supported by the Seed fund of Vin University [Grant IO 400043].

THE ROLE OF INTEGRATED MARKETING STRATEGIES ON HOTEL PERFORMANCE DURING COVID-19 IN LEBANON

This study explores the relationship between integrated marketing strategies and hotel firms’ performance during and after the COVID-19 pandemic. The specific goal was to look into how different marketing tactics, including public relations, social media, sales promotion, and advertising, influenced hotels’ performance and ability to survive the COVID-19 crisis. The research design for this study was descriptive in nature. Primary data were gathered from a sample of about 200 guests who stayed at five 5-star hotels in Lebanon. The data collection process included the use of a scale questionnaire, which enabled the measurement of customers' perspectives and experiences with the integrated marketing tactics adopted by these hotels. Based on the findings, numerous suggestions have been made for hotel companies wishing to increase their marketing effectiveness in challenging situations. These recommendations include investing in targeted advertising campaigns, using social media platforms to engage with customers and promote their offerings, providing appealing sales promotions to encourage bookings, and maintaining strong public relations to improve brand reputation and customer trust.

BUSINESS MODEL INNOVATION OF HOTELS IN VIETNAM DURING THE COVID-19 PANDEMIC

The tourism sector encountered significant difficulties in sustaining operations amidst the global economic downturn caused by the COVID-19 pandemic. Initial observations within the hospitality industry suggest that redesigning the business models could be a key solution for recovery. However, there is a scarcity of empirical studies on this topic, particularly in the hotel industry. To address both practical and theoretical gaps, the authors conducted a study on business model innovation of hotels in Hanoi during the COVID-19 pandemic. The study involved 300 participants with diverse genders and roles working in high ranking lodging units, aiming to evaluate how hotel firms transformed their business models from the perspective of industry professionals. The results indicated that factors such as the business environment, the impact of the COVID-19 pandemic, and a culture of innovation positively influenced the degree of business model innovation among hotel firms. Furthermore, a higher level of business model innovation was found to have positive effects not only in the short term but also on overall business performance.

How hotel firm value fluctuates with alternative leveraging strategies

AbstractThis study empirically examines the impact of leverage and capital structure on firm value for the US hotel industry from 1991 to 2017. We find strong evidence that leverage positively relates to firm value for firms in the hotel industry. This relationship is most robust for hotel firms with low financial health, consistent with the theory that firms signal positive information through capital structure. We also find that the relationship between leverage and firm value was weakened during the financial crisis, particularly for firms close to financial distress. Our results suggest that hotel management, creditors, and investors should pay attention to the magnifying effect of leverage on firm performance and the impact of financial crises on the value of debt. This study's empirical results also support the idea that firms in the hotel industry signal to outside investors through debt.

Neuroleadership: Affective experiences in the workplace and their influence on employees’ evaluative judgements

Neuroscience-based approaches have had little presence in studies in the field of hotel firms. The literature indicates that neuroleadership behaviors can change the employees’ perceptions of their work environment. The purpose of this study is to analyze how affective events in the workplace influence employees' evaluative judgements of certain organizational factors. The paper presents the results of a six-month study involving 150 lower-level employees and 25 middle managers of a hotel tourism chain. The study was carried out by a staff member of the company in question, a characteristic that is beyond the scope of most research. The results show that the affective events significantly improve employees' evaluative judgements of different organizational variables, highlighting the importance of neuroleadership skills in managing emotions and improving employee well-being.

How to enhance online reputation? An empirical study from a joint customer–firm perspective

Online reputation is critical for hotel firms, as evidenced by consumer ratings in online media. The present study aims to develop insights into the antecedents of the hotel firm's online reputation and thus make a dual contribution to the literature by (a) examining the strategies implemented via online media as antecedents and (b) combining the firm's perception of the value it has delivered with the market's perspective. A quantitative empirical study on hotel firms and their consumers was conducted. The results show that the firm's perception of the value it has delivered (“firm perceived value”)—the antecedents of which are strategic online reputation-management and the strategic use of revenue-management—has a positive and significant effect on online reputation (as measured from the customer perspective), and that strategic online reputation-management has a positive and significant effect on the strategic use of revenue-management.

Patenting Behaviour of Hotel Firms

The characteristics of the hotel industry have led to the belief that hotel innovation happens through incremental service improvement, which is hardly patentable. In addition, there is a belief that technological development occurs only by incorporating innovation from other industries. Therefore, most research on innovation in the industry excludes the patenting behaviour of hotel companies, which might be a significant gap in the literature.. This paper is set up to address this gap using secondary data regarding the patents registered by hotel firms and variables concerning the characteristics and performance of those firms. Two hundred twenty-two patents (222) from 72 hotel firms in 14 countries were analysed and categorised using a mixed approach, qualitative and quantitative. A cluster analysis generated two profiles of firms according to their characteristics and patenting behaviour. The results suggest that hotel firms tend to patent inventions useful for innovating their processes or products and applicable in other industries (e.g., types of beds; flavoured beers; baskets for dishwashers). This result questions the approach of hotel firms as exclusive innovation adopters. Some hotel firms have an impressive track record of patent applications, with firms that have submitted dozens of applications each. The study has relevant implications for theory and practice, bringing a fresh approach to the study of innovation in the industry and revealing that patenting has been a growing industry trend.

Big Data Analytics and Firm Performance in the Hotel Sector

Big data (BD) analytics play a key role in helping hotel firms gain competitive advantages and achieve superior performance. The purpose of this study was to determine which factors encourage the use of big data analytics (BDA) by hotel firms and the impact of BDA on hotel firms’ performance. Understanding the impacts of big data analytics in the hotel sector is important to help hotel managers use big data for creating business value by increasing hotel performance. A research model was developed and tested with data collected through a questionnaire sent to hotel managers in a European country and analysed with PLS. The results indicate that organisational readiness and competitive pressure encourage the use of BDA through the mediating role of top management support. The findings also indicate that the use of BDA can create business value by increasing the main dimensions of hotel performance: financial performance, customer retention rate, and hotel reputation.

Valuation effects of earnings management on hotel firm value

AbstractThis study investigates the valuation effects of earnings quality on a hotel’s firm value between 1991 and 2017. A unique perspective from the financial crisis period is utilized to explore the changes further when hotel firms face financial distress. We adopt the ordinary least squares (OLS) regression method in this study. Generalized Least Squares (GLS) regression and Petersen’s Clustered Standard Error Model to confirm the validity of results. Seemingly unrelated regressions (SUR) analysis is adopted to compare the impact of the financial crisis on subsamples of low and high Altman Z‐scores and subsamples of non‐Big‐4 and Big‐4 firms. Substantial evidence supports our assertion that increased discretionary accruals and earnings management bring down earnings quality and, in turn, decrease a hotel’s firm value. Results reinforce that the 2008 financial crisis had an impact on the relationship between earnings management and hotel firm value. The negative effect that discretionary accruals and earnings management have on hotel firm value is mitigated for hotel firms with low credit strength or not audited by one of the Big‐4 firms. Stockholders of hotel firms should be aware of the impact and enforce additional measures to control earnings management activities during a financial crisis.

The Effect of Entrepreneurial Orientation, Service Innovation on Firm Performance: A Perspective of Star Rating Hotel in Sarawak

The hotel industry is characterized as a human-intensive service provider, therefore, innovation, particularly service innovation, does not generally depend on technological and scientific contributions. Most often, innovation in this industry is derived from human interaction that often leads to little adjustments or continuous improvement to meet potential customer expectations and to satisfy the current customers. Although several recent studies have begun to address this issue, an understanding of service innovation in low-technology and service industries, particularly hotel firms, is less understood. This research builds on the resource-based view (RBV) of the firm to examine the effects of entrepreneurial orientation on service innovation and service innovation on hotel performance. Utilising a quantitative approach, 73 hotel operators were taken as the sample of this study. A non-probability sampling of purposive sampling was used in this study whereby only hotels that have a star rating from one to five stars were chosen and included in the sample based on the list of registered hotels provided by Sarawak Ministry of Culture, Arts and Tourism Malaysia. The findings of the study found that there is a positive relationship between entrepreneurial orientation, service innovation and performance. This study makes a considerable contribution to the existing literatures on entrepreneurial orientation, service innovation, particularly in regards to explaining the performance of hotel industry in Sarawak.

Research on Outsourcing by Hotel Firms: Current State and Future Directions

This article aims to analyse the current state of hotel outsourcing research and where it should go in the future. Research on outsourcing is increasingly present in the hospitality literature. This paper reviews published works on hotel outsourcing. However, the research still seems to be limited to traditional topics and aspects, and it is necessary to define a new concept of outsourcing that reflects the new trends in tourism company management. Outsourcing has to be more sustainable and, therefore, contribute to the sustainable performance of the hotel, and it has to be related to other current topics in the hospitality literature. This reflection builds on the research conducted to date and proposes topics for current and future research. The paper proposes where outsourcing research should be heading, based on current research. The outsourcing of the future should be sustainable, consider its impact on the quality of service for end customers, facilitate the development of Industry 4.0, support innovation, and contribute to making the hotel more resilient. This paper on the direction hotel outsourcing research should take is the first critical examination of outsourcing, and it incorporates novel factors related to the new environmental management

The determinants of profitability in non-financial UK SMEs

PurposeThe purpose of this study is to examine determinants of profitability of non-financial firms listed small- and medium-sized enterprises (SMEs) in the UK from 2012 till 2020. It has been argued that profitability plays a key role in economic development and growth. Despite the important role that SMEs play in developed economies like UK, academic research into SMEs profitability determinants in developed countries is not extensive.Design/methodology/approachThe methodologies used include dynamic panel data estimation techniques. Relationship of nine independent variables with profitability was examined. Two models are created using return on assets (ROA) and return on equity (ROE) as dependent variables. Size, age, efficiency, working capital, liquidity, leverage and volatility of the firm represent firm-specific independent variables. Two macroeconomic variables, namely, gross domestic product and inflation are also used as independent variables. Data obtained from Thomson Reuters Data Stream for 93 listed SMEs companies in the UK from 2012 to 2020. Fixed effects, random effects and generalized method of moments were used in data analysis.FindingsAll variables showed significant influence on profitability, except liquidity reflecting insignificant impact on profitability in two regression models conducted for 93 firms under study. Efficiency, liquidity and leverage are the only three independent variables with similar impact on both ROA and ROE.Practical implicationsIdentifying determinants of profitability will help stakeholders and corporate executive make sound decisions to ensure sustainability and stability at the firm level. This is particularly important given the key role played by SMEs in economic development and growth. The findings of this study would help direct financial management practices to ensure a favorable sustainable organizational performance.Originality/valueThis study differs from previous studies that focused mainly on developing countries; with limited research conducted on profitability of SMEs in developed economies. To the best of the author’s knowledge, this is the first study to examine factors influencing profitability of SMEs in UK. Previous studies concentrated on service sector like insurance and hotel firms.

The role of capital structure management in maintaining the financial stability of hotel firms during the pandemic—A global investigation

Due to the detrimental effects of the Covid-19 pandemic on the hotel sector, pandemic crisis management research has received lots of academic attention, from studies in sales-marketing to human resource management. However, financial management has been largely overlooked in the agenda of pandemic crisis management and hotel resilience. Therefore, this paper aims to address the research gap by exploring the role of capital structure management in maintaining financial stability and resilience capacities of hotel firms during this evolving and unpredictable Covid-19 pandemic. Using a database of 1882 firm-quarter observations of 196 hotel firms in 30 countries from Quarter 3 2018 to Quarter 2 2021, it is found that low debt capital structure mitigates the adverse impact of the pandemic on hotel firms’ financial stability during this turbulent time; particularly the negative impacts caused by government restrictions on both domestic and international travel. The benefit of low debt levels is more pronounced for more vulnerable hotels such as small, less diversified, and slow growing hotel firms. Also, hotel firms that have less long-term debt are more financial stable and resilient during pandemic period. Research outcomes suggest that financial management, in particular capital structure policies should be a critical part of hotel resilience building and crisis management strategy for hotel firms.

The impact of sustainability certifications on performance and competitive action in hotels

Despite the growing research interest in the benefits of sustainability certificates to businesses, their impact on hotel firms’ financial performance at the competitive set (compset) level is not known. To fill this gap in the literature, this study uses data from 251 certified hotels located in Florida, United States, to analyze the effect of sustainability certificates on key performance indicators (KPIs) in hotels (e.g., Occupancy, ADR, RevPAR), compared to their compset. The findings show that certified hotels can increase their KPIs compared to competitors through a first-mover advantage. The study offers significant contributions to the literature on environmental management and competitive dynamics in the hospitality industry. We provide guidelines to managers regarding timing of response to other hotels in their competitive set when obtaining sustainability certification.

Predicting Organizational Citizenship Behaviour in Hospitality Businesses with Decision Tree Method

ABSTRACT The purpose of this study is to determine the effect of toxic leadership perception, leader-member exchange, job stress and emotional exhaustion to predict organizational citizenship behavior of hotel employees. The study is conducted with 623 participants from four and five-star hotel firms in Alanya which is among the top destinations in Turkey. Decision tree analysis is applied to determine the variables that decisive predicting organizational citizenship behavior of the employees. The external validity of the results obtained with the decision tree model is tested with artificial neural networks. The analysis showed that the most significant variable to predict employee organizational citizenship behaviors is leader-member exchange. Findings are discussed in terms of theoretical and practical implications for hospitality literature and sector practitioners.

The role of financial performance of Eurostoxx listed hotel companies in determining CEO compensation

This paper is focused on the effect of firms’ financial performance in the compensation of CEOs of Eurostoxx listed hotel firms. We analyze CEO cash-, equity-, and total-compensation using as proxies of financial performance both accounting-based and market-based measures, where both return and risk are considered. Market-based financial risk measure enables us to delve into the relationship between CEO compensation policies and lagged firms' systematic and idiosyncratic risk components computed by using a well-known asset-pricing factorial model. Results show a non-significant linear relationship between CEO compensation policies and stock return in the Eurostoxx hotel firms even when we control for market-based risk. However, results support a negative and significant relationship between lagged financial risk and CEO equity compensation that is more intensively related with the firms' idiosyncratic risk component. Moreover, we show evidence of a non-linear effect of financial return on CEO cash compensation that is idiosyncratic-risk-level dependent.