Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/11479
Title: Optimizing room capacity and profitability for Hong Kong hotels
Authors: Tsai, H 
Gu, Z
Keywords: Single-period inventory model
Capacity
Profitability
Supply
Demand
Hong Kong
Issue Date: 2012
Publisher: Routledge, Taylor & Francis Group
Source: Journal of travel & tourism marketing, 2012, v. 29, no. 1, p. 57-68 How to cite?
Journal: Journal of travel & tourism marketing 
Abstract: This study estimates optimal guestroom capacity for the Hong Kong hotel industry during 2010-2013 using a single-period inventory model. Using Hong Kong hotel operational data for the period 2000-2009, we identify an issue of serious overcapacity of Hong Kong hotels for 2010-2013, the severity of which ranges from 30.6 to 40.7% above the optimal hotel guestroom counts derived from our study. We further estimate an optimal advertising budget as a percentage of total revenue (3.78%) in maximizing profitability. Attention is called for stakeholders to carefully reexamine existing and future hotel development plans and work on pushing up future room demand. The implications of our study are also discussed.
URI: http://hdl.handle.net/10397/11479
ISSN: 1054-8408
EISSN: 1540-7306
DOI: 10.1080/10548408.2012.638563
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