External Business Environment and Performance of Hotels in Accra

Abstract

This study sought to examine the influence of the external business environment on the performance of hotels in Greater Accra Region. PESTLE (Political, Economic, Social-Cultural, Technological, Legal and Environmental) factors were used to examine the external business environment of the hotel while the performance was measured from the preview of financial and non-financial performance indicators. A sample of 150 respondents comprising of management and staff of hotels was selected through a stratified proportionate random sampling technique. Semi-structured questionnaire was used to collect the primary data used for the analyses. The Statistical Package for Social Sciences (SPSS) was employed in the data analysis. The data was analyzed using Pearson correlation test and multiple linear regression. Results from the study revealed that external business environment factors such as legal and technological factors positively influence hotel performance. However, external business environment factors such as economic, political, social and environment factors do not exert any influence on hotel performance. The recommendation made include the need for Hotel management/owners to maximize their investment in technology in their operations as technological factors enhance hotel performance. Also, managers of hotels need to be aware of the risks involved in the legal environment and is often advisable to have a reliable local partner and an attorney who can deal with the legal issues and bureaucracy.