How does demand uncertainty affect food and beverage capacity in the hotel industry?

Chiang-Ming Chen, Hsien-Hung Chiu and Chien-Lung Hsu

Current Issues in Tourism, 2016, vol. 19, issue 13, 1288-1294

Abstract: This study investigates the effect of demand uncertainty on hotels’ food and beverage (F&B) capacity using the operation data of international tourist hotels in Taiwan. The empirical results of this study show that demand uncertainty leads to an increase in F&B capacity. Moreover, the magnitude of this effect increasingly strengthens for hotels with larger F&B scales. Our results together with other studies on room capacity collectively indicate that hotels’ overcapacity problem resulting from demand uncertainty considerably varies with hotel scales and between different hotel sectors.

Date: 2016
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DOI: 10.1080/13683500.2015.1087478

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