EXPLORING THE VIEWS OF HOTEL MANAGERS ON ACTIVITY-BASED COSTING ADOPTION IN GUJARAT

Abstract

There is a move away from standardisation and towards customization in today's fiercely competitive market, with a focus on both price and quality. Because traditional costing methods sometimes allocate spending incorrectly, especially when it comes to overhead costs, they have become antiquated. An inventive way to identify accurate and equitable pricing is through the use of the activity-based costing approach. Determining these activities is crucial since activity-based costing mainly concentrates on activities and cost drivers. Giving guests a more accurate picture of hotel service prices is the primary goal of activity-based costing. Effectiveness and profit margins can both be increased by setting prices that are substantially in line with their actual manufacturing costs. Activity-based costing is essential to the hospitality sector because it shows how profitable customers really are, points out areas where costs can be cut and services rendered more efficiently, and offers practical advice on how to bargain for lower prices and reduced costs for various tasks. It has been suggested that the most accurate method for determining hotel service rates is to use activity-based pricing. 75 hotel managers in Gujarat were the subject of this study, which aimed to understand their opinions regarding activity-based costing.