THE IMPACT OF OUTSOURCING ON PROFITABILITY OF HOTEL COMPANIES

Operations of hotel companies in an increasingly dynamic environment require new strategic solutions. Outsourcing is offered as a strategic tool aiming at reducing costs whileas improving the quality of implementation of certain business activities. Results of previous studies show that involvement of external partners in a hotel company business has resulted in the conversion of part of the fixed costs into variable costs that depend exclusively on the activity of hotel companies. Thus reduction of the total operating costs is achieved resulting in increase in profit of hotel companies. At the same time, application of outsourcing releases a part of the capital assets in hotel companies which reduces the resources required to perform activities entrusted to the external partner. The aim of this paper is to explore the impact of outsourcing on profitability of the hotel companies in Croatia taking into consideration the size of the hotel companies. The purpose of the research is to demonstrate the application of outsourcing in the context of increasing profitability and help in future solutions for implementation of outsourcing in hotel companies. The research methodology will be based on the correlation analysis with the use of descriptive statistics.