Economic efficiency of coastal hotel companies

Figures & data

Table 1. Review of DEA literature on hotel efficiency.

Author(s)	Sample	Inputs	Outputs
Morey and Dittman (2003)	54 American hotels	Room division expenditure, energy cost, salaries, non-salary expenditure for property, salaries and related expenditure for advertising, non-salary expenses for advertising, fixed marked expenditure for administrative work	Total revenue, level of service delivered, market share, rate of growth of output
Barros (2005)	43 Portuguese hotels	Capital and labour	Sales, number of guests, nights spent
Zhou et al. (2008)	31 Chinese regions	Total number of full-time employees in regional hotel industry, total number of guest rooms in the hotels in a region, total fixed assets in a regional hotel industry	Total revenue, the revenue generated by room occupancy, food and beverage service and other revenues from laundry and service fees, average occupancy rate
Barros et al. (2009)	15 Portuguese hotels	Number of employees, physical capital	Sales, added value
Assaf and Cvelbar (2010)	24 Slovenian hotels	Number of rooms, cost of materials, cost of services, amortization cost, number of employees and food and beverages (F&B) division capacity	Room division total sales, F&B division total sales.
Pulina et al. (2010)	150 Italian hotels in 21 regions and island of Sardinia	Labour costs, physical capital of hotels	Sales revenue, added value
Oliveira et al. (2013)	84 Portuguese hotels—Algarve	Number of rooms, number of employees, the F&B capacity, other costs	Total revenue
Parte-Esteban and Alberca-Oliver (2015)	1385 Spanish hotels	Number of full-time employees, book value of property, operational costs	Sales
Poldrugovac et al. (2016)	105 Croatian hotels	Energy expenses, room expenses, F&B expenses, expenses associated with other services, labour expenses	Total revenue, occupancy rate
Sellers-Rubio and Casado-Díaz (2018)	17 Spanish regions	Number of hotels in the region, number of available hotel beds in the region, number of full-time-equivalent employees of hotels in the region	Average daily rate, revenue per available room, average occupancy rate
Lado-Sestayo and Fernández-Castro (2019)	400 Spanish hotels placed in 97 tourist destinations	Depreciation, labour cost, operational cost	Sales revenue

Source: Compiled by the authors.

Table 2. Description of the hotel companies on the Slovenian coast.

Company	Hotels
Eurotas hotels LLC	Hotel Barbara, Hotel Piran, Boutique Hotel
Hotels Bernardin PLC	Grand Hotel Bernardin, Hotel Histrion, Hotel Vile Park, Hotel Salinera, Hotel Haliaetum, Hotel Mirta
Artana LCC	Art Hotel Piran
Oleander resort LCC	Hotel Oleander, Hotel Lavander
Hotel Palace LCC	Hotel Kempinski, Hotel Palas
Hotels Metropol LCC	Hotel Metropol, Hotel Lucija
Istrabenz Turizem PLC	Hotel Lifeclass, Grand Hotel Portorož, Hotel Slovenija, Hotel Apollo, Hotel Riviera, Hotel Neptun, Hotel Mirna
Damjan Djuričič AmE	Hotel Fiesa
SVM Turizem LCC	Hotel Bio
Adria LCC	Hotel Convent, Olive Suites, Vila Cedra, Vila Bor, Vila Adriatic, Apartments Adria
Hotel Oltra LCC	Hotel Oltra
Keltika partner LCC	Hotel Keltika
Hotel Marina LCC	Hotel Marina
Delfin hotel ZDUS LCC Izola	Hotel Delfin
Belveder LCC	Hotel Cliff, Kamp in Ville
Hotel Marko LCC	Hotel Marko

Note. LLC = limited liability company, PLC = publicly limited company, AmE = sole proprietor.

Source: Compiled by the authors.

Table 3. Descriptive statistics of variables for 2015 and 2018.

Variable	Units	Standard error (SE)	Mean	Standard deviation (SD)	Min.	Max.
		2015
Outputs
Net revenues from sale	EUR	2,018,811.39	5,497,687.34	8,075,245.54	27,021.00	256,945.00
Other income	EUR	79,985.41	164,134.00	319,941.65	0	1,133,736.00
Inputs
Labour cost	EUR	720,129.14	1,840,530.74	2,880,516.57	4,760.96	9,865,953.00
Cost of goods, materials and services	EUR	987,122.07	2,712,372.74	3,948,488.28	28,679.00	12,567,117.00
Tangible fixed assets	EUR	98,971.89	209,418.75	398,887.54	0	1,242,472.00
Other operating expenses	EUR	5,578,500.93	14,467,483.50	22,314,003.70	106.00	76,396,460.00
Input prices
Labour price	EUR	0	1070.13	0	1070.12	1070.12
Price of goods, materials and services	EUR	0	379.53	0	379.53	379.53
Price of other operating expenses	EUR	0	3393.03	0	3393.03	3393.03
Price of tangible fixed assets	EUR	0	16,845.48	0	16,845.48	16,845.48
		2018
Outputs
Net revenues from sale	EUR	2,341,728.18	6,740,659.09	9,655,192.64	50,133.30	30,632,600.00
Other income	EUR	83,201.81	140,685.91	343,049.86	0	1,397,965.00
Inputs
Labour cost	EUR	774,179.39	2,092,209.75	3,192,023.40	9880.66	10,274,111.00
Cost of goods, materials and services	EUR	1,078,167.07	3,227,194.80	4,445,396.73	32,244.76	14,199,328.00
Tangible fixed assets	EUR	64,271.28	142,620.28	264,997.29	0	1,065,350.00
Other operating expenses	EUR	4,961,907.92	13,330,723.70	20,458,470.40	90.16	66,425,733.00
Input prices
Labour price	EUR	0	1169.72	0	1169.72	1169.72
Price of goods, materials and services	EUR	0	333.26	0	333.26	333.26
Price of other operating expenses	EUR	0	3763.97	0	3763.97	3763.97
Price of tangible fixed assets	EUR	0	20,676.34	0	20,676.34	20,676.34

Source: Authors’ own calculations.

Table 4. Efficiency of companies whose main gainful activity is the hotel industry.

YEAR	2015					2016
Company	TE (VRS)	AE	EE	Scale		TE (VRS)	AE	EE	Scale
1	1.000	1.000	1.000	0.565	Drs	0.967	0.053	0.052	1.000	Crs
2	1.000	1.000	1.000	1.000	Crs	–	–	–	–	Crs
3	1.000	1.000	1.000	1.000	Crs	1.000	1.000	1.000	1.000	Crs
4	1.000	1.000	1.000	1.000	Crs	1.000	1.000	1.000	1.000	Crs
5	0.913	0.141	0.129	0.538	Drs	0.981	0.154	0.154	1.000	Crs
6	1.000	1.000	1.000	0.789	Drs	0.958	0.586	0.561	0.991	Drs
7	1.000	0.173	0.173	0.536	Drs	1.000	0.129	0.129	1.000	Crs
8	0.779	0.071	0.056	0.512	Drs	0.772	0.071	0.055	0.981	Drs
9	1.000	0.808	0.808	1.000	Crs	1.000	0.639	0.639	1.000	Crs
10	1.000	0.685	0.685	0.625	Drs	1.000	0.960	0.960	0.912	Drs
11	1.000	0.055	0.055	0.491	Drs	1.000	0.059	0.059	0.999	Crs
12	1.000	0.428	0.428	0.550	Drs	1.000	0.564	0.564	0.989	Drs
13	1.000	1.000	1.000	0.588	Drs	1.000	1.000	1.000	0.978	Drs
14	1.000	1.000	1.000	0.487	Drs	1.000	1.000	1.000	0.896	Drs
15	1.000	0.666	0.666	0.584	Drs	1.000	1.000	1.000	0.996	Drs
16	–	–	–	–	–	1.000	0.472	0.472	0.996	Crs
17	–	–	–	–	–	–	–	–	–	–
Average	0.981	0.644	0.643	0.704		0.980	0.553	0.550	0.979

Note. TE = Technical Efficiency, AE = Allocative Efficiency, EE = Economic Efficiency, Drs = decreasing returns on scale, Irs = increasing returns on scale, Crs = constant returns on scale.

Source: Authors’ own estimations.

Table 5. Efficiency of companies whose main gainful activity is the hotel industry.

YEAR	2017					2018
Company	TE (VRS)	AE	EE	Scale		TE (VRS)	AE	EE	Scale
1	0.849	0.066	0.056	1.000	Crs	0.809	0.068	0.055	0.872	Drs
2	–	–	–	–	–	–	–	–	–	–
3	1.000	1.000	1.000	1.000	Crs	1.000	1.000	1.000	1.000	Crs
4	1.000	1.000	1.000	1.000	Crs	1.000	1.000	1.000	1.000	Crs
5	1.000	0.160	0.160	1.000	Crs	1.000	0.128	0.128	1.000	Crs
6	1.000	0.165	0.165	0.991	Irs	0.990	0.123	0.122	0.999	Irs
7	1.000	0.128	0.128	1.000	Crs	1.000	0.115	0.115	0.922	Drs
8	0.769	0.061	0.047	1.000	Crs	0.861	0.072	0.062	0.972	Drs
9	1.000	0.601	0.601	1.000	Crs	1.000	0.400	0.400	1.000	Crs
10	1.000	1.000	1.000	1.000	Crs	1.000	0.653	0.653	1.000	Crs
11	1.000	0.062	0.062	0.997	Irs	1.000	0.052	0.052	1.000	Crs
12	1.000	0.709	0.709	0.998	Drs	1.000	0.442	0.442	0.915	Drs
13	1.000	1.000	1.000	1.000	Crs	1.000	1.000	1.000	0.951	Drs
14	1.000	1.000	1.000	0.937	Drs	1.000	1.000	1.000	0.892	Drs
15	1.000	1.000	1.000	1.000	Crs	1.000	0.388	0.388	0.935	Drs
16	0.924	0.739	0.683	1.000	Crs	1.000	1.000	1.000	1.000	Crs
17	–	–	–	–	–	1.000	1.000	1.000	1.000	Crs
Average	0.971	0.555	0.550	0.991	–	0.977	0.502	0.500	0.968	–

Note. TE = Technical Efficiency, AE = Allocative Efficiency, EE = Economic Efficiency, Drs = decreasing returns on scale, Irs = increasing returns on scale, Crs = constant returns on scale.

Source: Authors’ own estimations.

Table 6. Panel model with generalized least squares (GLS) random effects.

Dependent variable: Economic efficiency	Coef.	Std. Err.	Sig.
Municipality of Piran	0.326	0.178	0.067
Municipality of Izola	0.104	0.197	0.598
Municipality of Koper	0.448	0.227	0.049
Constant	0.270	0.161	0.093

Note. The benchmark of comparison in estimation is the Municipality of Ankaran.

Source: Authors’ own estimations.

Table 7. Panel model with GLS random effects.

Dependent variable: Economic efficiency	Coef.	Std. Err.	Sig.
GDP growth of Germany	0.0005317	0.00154	0.730
GDP growth of Italy	–0.0008589	0.0017323	0.620
GDP growth of Austria	0.0000185	0.0005241	0.972
Constant	3.863133	05.213472	0.459

Note. The benchmark of comparison in estimation is the GDP growth of Slovenia.

Source: Own authors’ estimations.

Morey, R. C., & Dittman, D. A. (2003). Evaluating a hotel GM’s performance: A case study in benchmarking. Cornell Hotel and Restaurant Administration Quarterly, 44(5–6), 53–59. https://doi.org/10.1177/001088040304400507

 Google Scholar

Barros, C. P. (2005). Measuring efficiency in the hotel sector. Annals of Tourism Research, 32(2), 456–477. https://doi.org/10.1016/j.annals.2004.07.011

 Web of Science ®Google Scholar

Zhou, Z., Huang, Y., & Hsu, M. K. (2008). Using data envelopment analysis to evaluate efficiency: An exploratory study of the Chinese hotel industry. Journal of Quality Assurance in Hospitality & Tourism, 9(3), 240–256. https://doi.org/10.1080/15280080802412719

 Google Scholar

Barros, C. P., Peypoch, N., & Solonandrasana, B. (2009). Efficiency and productivity growth in hotel industry. International Journal of Tourism Research, 11(4), 389–402. https://doi.org/10.1002/jtr.711

 Web of Science ®Google Scholar

Assaf, A., & Cvelbar, L. K. (2010). The performance of the Slovenian hotel industry: Evaluation post-privatisation: Efficiency of Slovenian hotels. International Journal of Tourism Research, 12(5), 462–471. https://doi.org/10.1002/jtr.765

 Web of Science ®Google Scholar

Pulina, M., Detotto, C., & Paba, A. (2010). An investigation into the relationship between size and efficiency of the Italian hospitality sector: A window DEA approach. European Journal of Operational Research, 8, 613–620. https://doi.org/10.1016/j.ejor.2009.11.006.

 Google Scholar

Oliveira, R., Pedro, M. I., & Marques, R. C. (2013). Efficiency and its determinants in Portuguese hotels in the Algarve. Tourism Management, 36, 641–649. https://doi.org/10.1016/j.tourman.2012.06.009

 Web of Science ®Google Scholar

Parte-Esteban, L., & Alberca-Oliver, P. (2015). Determinants of technical efficiency in the Spanish hotel industry: Regional and corporate performance factors. Current Issues in Tourism, 18(4), 391–411. https://doi.org/10.1080/13683500.2013.800029

 Web of Science ®Google Scholar

Poldrugovac, K., Tekavcic, M., & Jankovic, S. (2016). Efficiency in the hotel industry: An empirical examination of the most influential factors. Economic Research-Ekonomska Istraživanja, 29(1), 583–597. https://doi.org/10.1080/1331677X.2016.1177464

 Web of Science ®Google Scholar

Sellers-Rubio, R., & Casado-Díaz, A. B. (2018). Analyzing hotel efficiency from a regional perspective: The role of environmental determinants. International Journal of Hospitality Management, 75, 75–85. https://doi.org/10.1016/j.ijhm.2018.03.015

 Web of Science ®Google Scholar

Lado-Sestayo, R., & Fernández-Castro, Á. S. (2019). The impact of tourist destination on hotel efficiency: A data envelopment analysis approach. European Journal of Operational Research, 272(2), 674–686. https://doi.org/10.1016/j.ejor.2018.06.043

 Web of Science ®Google Scholar