Innovative Service Delivery and Competitive Advantage of Small Scale Hotels in Nigeria: The Moderating Role of Opportunity Connectedness

Abstract

The global hospitality sector entered 2017 with a strong appetite for growth. Building on momentum gained in the previous years, renewed investor confidence and pent-up demand for trades propelled growth within the global lodging sector, fuelling an increase in transaction activities and worldwide improvements in hotel operations. Global tourism statistics indicate that the sector had created over $2 trillion US businesses, accounting for 11.3% of world consumption in 1997. Its direct contribution to GDP in 2016 was USD2, 306 billion (3.1% of GDP). This is forecasted to rise by 3.8% to USD2, 394.2 billion in 2017. Furthermore, the number of hotel units in the graded accommodation sector grew by 26% between 2005 and 2016, mainly in the USA. While strong post-recession gains appear to be cooling off, the hotel sector is projected to sustain strong 6% growth throughout2018, setting up the industry to hit a record-breaking $170 billion in gross bookings (Eurostat, 2017; Ting, 2017; Dakung & Maimako, 2016; World Tourism Statistics, 1997). With the 2012 Olympic Games, London remains a strong hotel market. Munich and Moscow‟s hotel markets continue to be top performers, experiencing high percentage competitiveness in hotel values compared to other European markets in 2013. For instance, Moscow is achieving an average of US$344,355 per room, well above the European average of US$240,307 over the past year (Roth & Fish bin, 2014). To increase their presence in high-growth markets, the international hotel chains are increasingly venturing into Africa. These international hotel chains‟ development pipeline in Africa is in Nigeria, with a total of 49 hotels and 7,470 rooms (Dakung & Maimako, 2016; Ward, 2013).This has led to the nation‟s tremendous economic growth in the hospitality industry especially in the early 2000.