Determinants of Accounts Receivables Management in the Hotel Industry in Kenya

Abstract

The purpose of the study was to establish the determinants of accounts receivables management in the hotel industry in Kenya. Specifically, the study sought to address the following specific objectives, that is, to establish how technology influences accounts receivables management in the hotel industry in Kenya, determine the effects of size of the organization in accounts receivables management in the hotel industry in Kenya, establish the effects of marketing channels in accounts receivables management in the hotel industry in Kenya, determine the effects of management structures in accounts receivables management in the hotel industry in Kenya and determine how policies influences accounts receivables management in the hotel industry in Kenya. The target population of the study was 47 hotels and lodges in Kenya. A sample of 141 respondents was selected using stratified random sampling in each hotel and lodge to group respondents into three strata. The strata were that of top management, finance staff and credit control staff. This study used primary data. Data collection methods used included use of questionnaires. Data was analyzed quantitatively and presented descriptively and illustrated by use of tables and charts. Information was sorted, coded and input into the statistical package for social sciences (SPSS) for production of graphs, tables, descriptive statistics and inferential statistics. In particular, means, standard deviations, and frequencies. Inferential statistics such as factor analysis and odd ratio regression were also used. The study findings indicated that there were written policies and internal operating procedures that had been approved by the governing body or senior management in the management of accounts receivables. The results showed that hotels kept records of accounts receivable, and utilized technology to advance invoices to the customer. The study concludes that the quality of technology infrastructure embraced at any hotel is very important because it influences accounts receivable management and hence improves the hotel’s management of accounts receivables. It can be concluded that the larger the hotel the higher the accounts receivables to be managed hence the need to have a strong management structures and policies in place. The study recommends to the hotel management to ensure that policies are put in place and procedures are adhered to in the management of accounts receivables. The hotel management is also urged to ensure that there are standardized and written manuals with clear policies regarding credit and its management. The study recommends that the hotel management should ensure that systems are upgraded with the technological changes taking place in the whole world.