Capacity Management Issues in the Hotel Industry of Cape Coast Metropolis

Abstract

Hotels relatively have a fixed capacity as the number of rooms cannot be changed according to demand. This makes the ability to balance demand from customers and the capability of a hotel's service system to satisfy demand a major concern for managers in Ghana's hospitality industry. However, capacity management is a key consideration, since occupancy is one of the two main performance indicators of successful hotel operations. This study explored capacity management concerns of hotels in the Cape Coast Metropolis. Data were gathered by questionnaires and all the hotels in the Cape Coast Metropolis, the leading tourist destination, were interviewed. The collected data were coded and analysed electronically, using SPSS. The study examined the nature of demand for hotel accommodation in Cape Coast Metropolis. Again, the strategies that hotels in Cape Coast Metropolitan area use to manage capacity were noted. Furthermore, the study assessed the benefit that hotels in Cape Coast Metropolitan Area get from capacity management. Finally, the techniques used in dealing with challenges of capacity management were identified. Based on these findings some recommendations were outlined.

Keywords: Capacity Management; Demand fluctuation; Occupancy patterns; Strategies.