Bìznes Inform (Mar 2020)
The ABC-XYZ-Analysis of Regions of Ukraine by Profitability/Risk Level of Tourism Industry
Abstract
The article substantiates the important role of the use of the ABC-XYZ-analysis to assess and analyze the functioning of Ukraine’s tourism industry in the regional dimension. In terms of portfolio investing, to make an effective management decision, it is important to investors to compare, among many alternative ones, two factors – profitability and risk level. The principle of choosing an investment strategy based on the optimal ratio of profitability and risk should be decisive not only for the institutional investor, but also for the State, which establishes the strategic and priority areas of development, including tourism. Tourism is one of the largest and fastest growing sectors of the economy not only world-wide, but also in Ukraine. However, tourism activities are characterized by elements of uncertainty and risk that need to be taken into account when establishing the State policy. The article proposes to group the regions of Ukraine by profitability (profit from the provision of tourism services) using the ABC-analysis, and by the level of risk of tourism industry – using the XYZ-analysis. This grouping allowed to compare the regions of Ukraine by the level of profitability and risk in tourism, which will help to make optimal management decisions on their efficient implementation in the future. Using a combination of the ABC- and XYZ-analyses, the carried out research allowed to group and position the regions of Ukraine in the matrix of the ABC-XYZ-analysis on the profitability/risk level of the tourism industry. Grouping the regions of Ukraine allows to identify the most promising regions in the sphere of development of the tourism industry and to classify them as such that form the image of Ukraine on the international scene and make the greatest contribution to the international recognition of Ukraine as a country attractive for tourists.
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