Cornell Hotel and Restaurant Administration Quarterly, vol.41, no.4, pp.21-31, 2000 (SCI-Expanded)
Turkey's national policy of expanding the number of hotel rooms nationwide over the past two decades has been successful in increasing supply, but at a cost. The government offered strong incentives for entrepreneurs to open hotels on the nation's Mediterranean and Aegean coasts. Many of the hotels that opened as a result, particularly those in low-price tiers, offer repetitive concepts and are not professionally managed. As a consequence, Turkey's resort operators rely heavily on international packagetour operators to fill their rooms. What has turned into an oversupply of rooms gives the tour operators market power over the lodging operators, forcing the latter into price competition. To compensate for their lack of income, the lodging operators offer minimal services (or are unable to offer good service). A particular challenge to the hoteliers is the tour operators' practice of changing bookings at the last minute, which causes lodging operators with unused capacity to accept low rates for otherwise empty rooms. While Turkey's lodging entrepreneurs probably cannot change the external factors that force them to accept low prices, they could address their internal problems of lack of cooperation and poor management skills.