A three-sector comparison of the business performance of small tourism enterprises: an exploratory study

The current exploratory study compared the performance of 305 small tourism ventures in Israel in an attempt to understand the unique characteristics and differences in the operation of three types of ventures. The hypothesis was that active recreation and sites of interest (tourist attractions) ventures would perform better than accommodation ventures given their relatively high capacity, service variety and flexibility that enables them to cater simultaneously to various market segments and extend the tourist season. The findings generally supported the hypothesis regarding active recreation ventures, though less support was found with respect to sites of interest. The latter failed to fulfill their potential. Contrary to expectations, accommodation ventures performed better than the other two types of ventures in terms of revenue per employee, profitability relative to competitors and customer satisfaction. It is suggested that the unmediated contact between host and guest enables immediate feedback and enhances customer satisfaction. The study illustrates the significance of dividing the industry into subsectors for identifying strengths and weaknesses by subsector.