Determinants of the Level of Revenue of Tourist Enterprises within the North Coastal Region of Kenya

Abstract

Revenue of produced goods and/or provided services is determined by the volume of sales, prices of particular products, variety of products, ways of invoicing and period of payment. The current study was carried out at the north coastal region among tourist enterprises to establish factors that influence the amount of revenue they generate per year. The target population involved all enterprises relying on tourists for their business. They include hotel accommodation facilities, curio shops and tour companies. Simple random sampling technique was used to select a final sample of 97 enterprises, whose owners were given self administered questionnaires. Afterwards a regression on determinants of revenue by tourist enterprises was expressed as Y= ?_o + ?₁X₁+ ?₂X₂+ …?_n X_n+ ?; Where: Y – is the dependant variable; X_1-n – are the independent variables; ?₀ – is the constant ?_1-n – are the regression coefficients or change induced in Y by each X,         while ? is the error. The results indicated that the net monthly income of enterprises was determined by the age of the enterprise (? = 0.169, p = 0.001), the location of the business (? = 0.149, p = 0.038) and the number of employees within the enterprise (? = 0.703, p < 0.0005). Therefore findings indicated that the main determinants of revenue for tourist enterprises at Kenya’s north coast were the age of the business, business location and the number of employees.

Keywords: Tourist enterprises; Determinants of revenue; Firm; Tourist expenditures