location of hotel groups’ headquarters
TRANSCRIPT
Location of hotel groups’
headquarters
Stanislav Ivanov
Email: [email protected]
Web: http://stanislavivanov.com
Maya Ivanova
Email: [email protected]
INVTUR Conference, 17-19 May 2017, Aveiro, Portugal
stanislavivanov.com
Dr. Maya Ivanova
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• Assistant Professor, Varna University of Management, Bulgaria
(http://vum.bg)
• CEO of Zangador Ltd. (http://www.zangador.eu)
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Dr. Stanislav Ivanov
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• Professor and Vice Rector (Research), Varna University of Management, Bulgaria (http://www.vum.bg)
• Editor-in-chief of the European Journal of Tourism Research (http://ejtr.vumk.eu)
• CEO of Zangador Ltd. (http://www.zangador.eu)
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Why do some countries have numerous local hotel groups, some of which have grown into global market leaders, while other countries do not?
Which factors influence the concentration of hotel groups’
headquarters in a few countries?
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The location of hotel groups’ headquarters is important, because:
a. It determines the applicable law in the relationship between the hotel group and the affiliated hotels
b. Cultural environment and acceptable business practices of the hotel group
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Country Hotel groups head-quartered in the country
Hotels, controlled by the hotel groups head-quartered in the country
Rooms, controlled by the hotel groups head-quartered in the country
Number Share Number Share Number Share
USA 129 39.69% 44671 47.37% 5835998 48.93%
China 32 9.85% 15252 16.17% 1776271 14.89%
Spain 30 9.23% 6151 6.52% 837066 7.02%
UK 19 5.85% 9303 9.87% 1207607 10.12%
Germany 14 4.31% 1445 1.53% 231846 1.94%
France 12 3.69% 9148 9.70% 693444 5.81%
Japan 12 3.69% 828 0.88% 187857 1.57%
Canada 5 1.54% 433 0.46% 86681 0.73%
Singapore 5 1.54% 432 0.46% 58800 0.49%
Thailand 5 1.54% 296 0.31% 45375 0.38%
Distribution of hotel groups’ headquarters by country
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Research background
• Various factors influence the location of corporate headquarters – geographic proximity to customers, suppliers, competitors, R&D centres, tax levels, favourable regulations, transportation accessibility of the site, etc (Brauerhjelm, 2004; Egger, Radulescu, & Strecker, 2013; Klier & Testa, 2002)
• In this paper we group the factors into 3 groups: hotel industry specific, tourism industry and general business environment factors (Ivanov and Ivanova, 2017)
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Research hypothesis (1)
Hotel industry specific factors:H1.1: The size of the local hotel industry is positively related to the concentration of hotel groups’ headquarters in the country.H1.2: The share of affiliated properties in the local hotel industry is positively related to the concentration of hotel groups’ headquarters in the country.H1.3: The average size of hotel in the local hotel industry is positively related to the concentration of hotel groups’ headquarters in the country.
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Research hypothesis (2)
Tourism industry specific factors:H2.1: The size of tourism industry is positively related to the concentration of hotel groups’ headquarters in the country.H2.2: The importance of tourism for the economy is positively related to the concentration of hotel groups’ headquarters in the country.H2.3: Destination’s competitiveness is positively related to the concentration of hotel groups’ headquarters in the country.
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Research hypothesis (3)
General business environment factors:H3.1: Population size is positively related to the concentration of hotel groups’ headquarters in the country.H3.2: Economy size is positively related to the concentration of hotel groups’ headquarters in the country.H3.3: Economic wealth of local population is positively related to the concentration of hotel groups’ headquarters in the country.H3.4: Level of globalisation is positively related to the concentration of hotel groups’ headquarters in the country.H3.5: Level of human development is positively related to the concentration of hotel groups’ headquarters in the country.H3.6: Level of corruption is positively related to the concentration of hotel groups’ headquarters in the country.H3.7: The concentration of hotel groups’ headquarters in the USA is much higher than in the rest of the world.
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Methodology
Dependent variables: • Share of Hotels 325 ranked hotel groups headquartered
in the country, • Share of hotels in Hotels 325 ranked groups
headquartered in the country• Share of rooms in Hotels 325 ranked hotel groups
headquartered in the country
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Methodology
Independent variables:• Hotel industry-specific factors
• Size• Characteristics
• Tourism-specific factors• Size• Importance for the economy• Destination competitiveness
• General business environment factors• Economy size• Population• Economic wealth• Level of globalisation• Human development• Corruption• Geographic region
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The six specific regression models are:
Share of hotel groups headquartered in the country:(1÷2) HotelGroupsShare=b0+b1.lnHotels+b2.lnAverage+b3.MShotels+b4.lnTourGDP+ +b5.TourGDP%+b6.TTCI+b7.lnGDP+b8.lnPPL+b9.lnGDPcapita+b10.KOF +b11.HDI+b12.CPI [+b13.USA]
Share of hotels in hotel groups headquartered in the country:(3÷4) HotelsShare=b0+b1.lnHotels+b2.lnAverage+b3.MShotels+b4.lnTourGDP+ +b5.TourGDP%+b6.TTCI+b7.lnGDP+b8.lnPPL+b9.lnGDPcapita+b10.KOF +b11.HDI+b12.CPI [+b13.USA]
Share of rooms in hotel groups headquartered in the country:(5÷6) RoomsShare=b0+b1.lnRooms+b2.lnAverage+b3.MSrooms+b4.lnTourGDP+ +b5.TourGDP%+b6.TTCI+b7.lnGDP+b8.lnPPL+b9.lnGDPcapita+b10.KOF +b11.HDI+b12.CPI [+b13.USA]
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Results (1)Outcome
Hotel industry-specific factors:
H1.1: The size of the local hotel industry is positively
related to the concentration of hotel groups’
headquarters in the country.
Supported
H1.2: The share of affiliated properties in the local
hotel industry is positively related to the
concentration of hotel groups’ headquarters in the
country.
Supported
H1.3: The average size of hotel in the local hotel
industry is positively related to the concentration of
hotel groups’ headquarters in the country.
Not
supported
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Results (2)Outcome
Tourism-specific factors:
H2.1: The size of tourism industry is positively related
to the concentration of hotel groups’ headquarters in
the country.
Not
supported
H2.2: The importance of tourism for the economy is
positively related to the concentration of hotel groups’
headquarters in the country.
Not
supported
H2.3: Destination’s competitiveness is positively
related to the concentration of hotel groups’
headquarters in the country.
Partially
supported
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Results (3)Outcome
General business environment:
H3.1: Population size is positively related to the concentration of
hotel groups’ headquarters in the country.
Not supported
H3.2: Economy size is positively related to the concentration of
hotel groups’ headquarters in the country.
Not supported
H3.3: Economic wealth of local population is positively related to
the concentration of hotel groups’ headquarters in the country.
Not supported
H3.4: Level of globalisation is positively related to the
concentration of hotel groups’ headquarters in the country.
Not supported
H3.5: Level of human development is positively related to the
concentration of hotel groups’ headquarters in the country.
Not supported
H3.6: Level of corruption is positively related to the concentration
of hotel groups’ headquarters in the country.
Not supported
H3.7: The concentration of hotel groups’ headquarters in the USA is
much higher than in the rest of the world.
Supported
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Conclusions
• Location of hotel groups’ headquarters depends on their home hotel industry size and characteristics, but is not affected by the size and importance of the tourism industry in their country
• General business environment factors do not have any impact on the location of hotel groups
• It is a matter of history, tradition and other non-specified factors why in some countries hotel groups are more concentrated (USA, Spain, China)
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Routledge Handbook of Hotel Chain Management
The most comprehensive source on hotel
chains:
46 Chapters 3 Editors 68 Contributors 18 countries 5 continents
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THANK YOU FOR THE ATTENTION!
QUESTIONS?
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