Tourism dynamics: Cyprus' hotel value chain and profitability

Authors

  • Nicholas C. Georgantzas

    Corresponding author
    • Management Systems Area, System Dynamics Consultancy, Fordham University Business Schools, 113 West 60th Street, Suite 617-D, New York, NY 10023-7484, USA.
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    • I am grateful to the three anonymous referees and the Managing Editor for their suggestions that have helped improve the paper immensely. Also, I thank Dr Brian Ellis, Protonique, Ltd, Mr Zacharias Ioannides, Director General, Cyprus Hotel Association, and Dr Nicos Peristianis, Executive Dean, Intercollege, Cyprus, for their invaluable help and input.


Abstract

In response to the Cyprus Hotel Association's aim to test how Cyprus' year 2010 official strategy may affect tourist arrivals, hotel bed capacity and profitability, this study looks at Cyprus' hotel value chain within the island's tourism customer–supplier value chain. A system dynamics simulation model helps compute multiple strategic scenarios of what might happen to Cyprus' tourism over the next 40 years. The faithful reproduction of historical tourism and bed capacity data through a 40-year time horizon shows the model's usefulness. The computed scenarios assess Cyprus' hotel value-chain sensitivity to policy parameters, tourism growth and tourism seasonality, along with their potential effects on the hotel value chain and profitability. Copyright © 2003 John Wiley & Sons, Ltd.

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