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Introduction
Performance is a key variable in managing hotels. According to the academic literature, there is a set of factors that can influence hotel performance, including internal factors related to the characteristics of the hotel and external factors related to the market or, more specifically, location (Sainaghi, 2010). Sound management of these factors can significantly influence long-term hotel survival (Baum and Ingram, 1998; Cvelbar and Dwyer, 2013; Vivel-Búa et al., 2016). Consequently, several studies have focused on analysing the determinants of performance in the hotel sector. This line of research is relevant in identifying the causes of differences in performance between hotels and even among tourist destinations (Sainaghi, 2011; Sainaghi et al., 2013).
The aim of this paper is to analyse the determinants of hotel performance by considering location and, for control purposes, hotel attributes and management practices. The study sample consists of 1,034 Spanish hotels and 97 tourist destinations in Spain during the period 2005-2011. This study provides evidence of the importance of considering simultaneously these three factors and supports the importance of location attributes, which are a relevant factor in explaining hotel performance.
This research makes three contributions to the literature. First, this paper considers a broader framework of analysis compared to previous studies, as it includes variables related to the characteristics of the hotel, its management and its location as potential determinants of performance. This is relevant because the results obtained for some of these factors have not been unanimous in the previous literature (Becerra et al., 2013; Cortés et al., 2007; Kim et al., 2003; Lee and Jang, 2007; Mohammed et al., 2015; Namasivayam et al., 2007; Sainaghi, 2011). This could be justified by the fact that most of these studies are at the firm level and do not include variables related to the tourist destination in terms of its location. The simultaneous analysis of variables related to the hotel and tourist destination helps identify the features of importance to the hotel and the significance of location in terms of improving performance.
The second contribution concerns the theoretical framework used to analyse the effect of location on the profitability of the hotel. The study simultaneously uses geographical location models, agglomeration models and competition models....