Foreign market entry mode choice of hotel companies: Determining factors

Abstract

Decisions regarding firm internationalisation, especially when it comes to choosing which market entry mode to use, have been one of the most frequently discussed topics in academic literature in the last few decades. Many studies have been conducted from different perspectives, either focusing on one or several sectors or analysing companies from a specific country. Nevertheless, there are few studies dealing with the Chinese hotel industry. The aim of this study is to analyse the relationship between environmental and firm-specific factors and entry mode choice by the largest Chinese hotel chains. Using a sample of 185 entries, the results show that cultural distance, market attractiveness, firm international experience, asset intangibility, firm size and the number of Chinese outbound tourists visiting each country are determining factors of entry mode choice.