1.

0 Abstract

Tourist’s arrival in Malaysia was recognized as a leading source of income for our
country which contributed to the development in other related fields, such as hospitality
industry. The business of hospitality is created when the needs for certain services emerge
for people away from home such as sleep and eat. Hence, its leads to the existence of new
type of business which is Bed and Breakfast to fulfil customer needs. In Sabah, bed and
breakfast are usually found in city centres (i.e. Kota Kinabalu & Sandakan) and in sub-urban
areas. Figured on the issue concerned faced in B &B sector, two main purpose of industry
analysis is developed; (1) To find what locals feel about bed & breakfast in the tourism
industry (2) To identify the attitude of locals towards tourist and tourism. Analysis on B&B
sector including Competitor, SWOT, Porter Five Force Model and PESTEL was carefully
handled. Results show that locals give positive feedback or attitude towards B&B
development although there a lot of impacts due to the tourism development towards the
local. In corresponds of second objectives, result show that local are having positive
attitudes towards foreign tourists and willingness for locals to support tourism and B&B
business in Kota Kinabalu is positive. Hence, comprehensive and solid planning is vital to
warrant perpetual satisfaction and benefits for local and tourists.

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2.0 Industry Overview

2.1 Historical data

The Malaysian economy highly depended on trading of commodities such as rubber,

cocoa, palm oil and timber until mid-1990s, where the country gradually experienced the
emergence of the manufacturing sector. During this period, the service industry, including
tourism was also booming. Significantly, major expansion in the tourism industry was
enjoyed since 1970 in which a sharp increase was reported in foreign exchange revenue,
employment opportunities and potential tourism attractions (Goldsmith & Mohd Zahari,
1994).

Tourist’s arrival in Malaysia was recognized as a leading source of income for our
country because the growth in this industry contributed to the development in other related
fields, for example hospitality, food and leisure. By 1990, with the launching of “Visit
Malaysia Year” campaign, the tourism industry had become the third largest source of
income in foreign exchange revenue (Poon & Low, 2005). These facts are consistent with an
analysis report of the World Tourism Organization (WTO) which reported that tourism has
been the significant source of foreign exchange reserves in a country (Chang, 2006). The
revenue from tourism ballooned from US$6,867 billion in 1960 to US$454,553 billion in
1999, a 6,620 percent increase. The WTO estimates that tourism populations will increase to
1,620 billion and the revenue will increase to US$2 quadrillion (million-million) in 2020.

Figure 1 : Forecast of tourist arrivals

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2.2 Nature of industry

Around the world, the hospitality industry has been marked by growing at an
unprecedented rate. There has increased focus on the hospitality industry as this industry
had the potential being global dimensions. In 2018, hospitality industry is considered as a
successful sector especially there are more and more consumers really precise on quality
and quantity of a product and service offered. Hence, the hospitality firms put more
emphasize in customers’ needs and requirements so that the customer satisfaction could
fulfilled and repeat service or purchase in the future. Dupre and Lane (1997) have
mentioned that the historic ability of hospitality industry to anticipate customer needs has
contributed to its successful in global economy.

When asking about the components of hospitality industry, most people will give
answer of hotels and restaurants. In fact, hospitality is just like a huge family chain
structure. It consisted of variety workforce speciality in an industry that involves employers,
employees, and customers. The business of hospitality is created when the needs for certain
services emerge for people away from home. People may travel from one country to another
one, or travel from one state to another state. They may also travel to a place nearby their
house. Those people need a place to eat or sleep. That is hospitality industry which provides
these two distinct services that satisfy people needs that are sleep and eat. Thus, under the
big umbrella of hospitality, there are two main sectors which included lodging and
foodservice (Jones, 2002). Hospitality industry has provided the shelter for people staying
away from home and provides food and beverages for people eating away from home or not
prepares their own meals.

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2.3 Past Performance

Hotel industry plays an important role in complementing tourism industry as it

provides accommodation to travellers and tourists. Nevertheless, hotel industry has been a
major player in the growth of the Malaysian economy, which contributing approximately 50
percent of the nation’s real GDP (Awang, Ishak, Radzi, & Taha, 2008). As per findings hotel
industry has been a major contributor on economic growth and development of country
(Kasimet al. 2014) in Malaysia. The reason for such saying deals with the fact that Malaysia
is among the list of countries that are having higher number of tourist footfall. Tourism and
hospitality has been major source for Malaysia’s economy. However, in recent year the
tourist footfall and hospitality service uptake in Malaysia has decreased due to rising level of
competition from other countries and better services being provided by them (Bourantaet al.
2017).

Figure 2: Graph indicating contribution of tourism and hospitality to Malaysia’s Economy

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2.4 Growth Potential

In 2009, Malaysia was listed among the top ten tourist destination in the world. This
makes it a first for the country. In that particular year, Malaysia could withstand the lack of
demands from consumers for global tourism as a result of the global economic crisis and the
outbreak of H1N1 virus which deter people from travelling (Aissa & Abd Al Khuja, 2014).
Even with that factor playing down on the world tourism sector, Malaysia still manage to
attract more tourists to visit the country than the previous year.

Figure 3: Tourist Arrivals & Receipts to Malaysia by Year.

As illustrated in Table 1, tourist arrivals in Malaysia have risen steadily since 2007,
with the exception of 2015 and 2017 where it decreased. Monetary receipts gained from
tourism also increase over the past few years and subsequently reached the RM80 billion
marks in 2016. Judging from the stable growth of the tourism sector, there is no doubt that
Malaysia’s tourism sector still has a lot of untapped potential. Therefore, the growth
potential of Malaysia’s tourism sector is looking bright.

Focusing on the main topic of this discussion, bed and breakfast in Sabah and indeed
throughout Malaysia is very popular. Bed and breakfast is a narrow term in the industry but
is widely categorized in Malaysia as homestay or budget hotels (Mapjabil et. al, 2015). This

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type of accommodation is quickly growing in the tourism market which is in line with the
growth of the tourism industry in Malaysia (Sivadasan, 2015). In Sabah, bed and breakfast
are usually found in city centres (i.e. Kota Kinabalu & Sandakan) and in sub-urban areas.
This is due to the ever increasing tourist arrivals to the State which contributed RM7 billions
in revenue to the State (Berita Harian, 2018). Furthermore, with various programmes
organized by the State government to boost tourism such as Visit Sabah Year and various
cultural and exhibitions, it will definitely attract more tourists hence increasing the demands
for accommodation.

2.5 Influencing Economic Data

There are several influencing economic data in Malaysia’s tourism sector such as currency
exchange rate, per capita income of households, and the quality of tourism infrastructure
(Nanthakumar et. al, 2007).

Currency exchange rate plays a significant role in the country’s tourism sector.
According to the Malaysian Institute of Economic Research (2015), ringgit’s depreciation will
help boost tourist arrivals in the country. In a country’s currency devalues, international
tourism becomes less expensive which will contribute to increased inbound tourism in to
that particular country (De Vita & Kyaw, 2013). In the case of Malaysia, the depreciation of
ringgit in 2016 was definitely a factor that affects tourism because foreigners will choose
Malaysia for its affordability and value-for-money factor (The Star Online, 2016).

Secondly is income per capita. Income is a variable that is typically used for an
explanatory variable in models of tourism demand (Gilaninia & Sharifi, 2013). Tourism
supply is actually demand for the country’s tourism supply in other countries. The demand
for tourism products depends on the income of tourists. Since tourism product is generally
considered as normal goods, therefore the increase in revenue could increase demand for
the product. Hence, per capita income of households in host country. In our country, locals
from other state can afford to go for a holiday in other state because most Malaysians are
categorized as middle-income earner. This means they have the opportunity of saving some
money to go for a holiday.

Third is the quality of tourism infrastructure. Tourism infrastructure is the basis of

tourism development. The importance of tourism infrastructure is reflected in the fact that it
can contribute to increasing the efficiency of production and distribution of tourism services

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(Jovanovic & Ilic, 2016). For example, for tourist to be able to reach certain destinations
there should be a developed transportation infrastructure. Furthermore, infrastructure
services in such as water supply, waste disposal, communication and electricity supply are
important to ensure the comfort of tourist when visiting certain destination. Malaysia’s
infrastructure is developed to sustain mass tourism judging from the number of tourist
arrivals into our country. However, there is still ways to improve its efficiency as well as
opportunities to develop new infrastructures especially in rural areas.

2.6 Issue and Purpose of Industry Analysis

Our Main Purpose of Industry Analysis based on the issue discovered in B&B industry is;

1. To find what locals feel about bed & breakfast in the tourism industry

In Sabah, bed and breakfast are easily found in city centres and some can be
found in sub-urban areas. This is to the fact that Sabah is one of the most
‘touristy’ place in Malaysia. For that reason, this industry analysis looks into how
locals feel about the existence of bed and breakfast in their local community and
how it impacts their life.

2. To identify the attitude of locals towards tourist and tourism

People in certain places could react differently towards tourism with some might
have a positive attitude towards it while others might not. This industry analysis
will identify the attitude of locals towards tourist from different places (China,
South Korea, Japan etc.). On top of that, this analysis also looks into the attitude
of locals towards the tourism industry, whether it is favourable or otherwise.

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3.0 Challenge for B&B industry

3.1 Competitor analysis

Competitor of B&B industry can be overlook in both direct and indirect competition.
According to Margaret Rouse (2015), direct competition can be defined as a situation in
which two or more businesses offer products or services that are essentially the same; as
such, the businesses are competing for the same potential market. Indirect competition is
the conflict between vendors whose products or services are not the same but that could
satisfy the same consumer need.

3.1.1 Direct Competitor

Some of the direct competitors of B&B industry in Kota Kinabalu are shown in the table
below.

Competitor Main Products and service offered

B&B@21  Nestled in the heart of Kota Kinabalu city along Jalan Dewan
(Bed &  Walking distance to the oldest clock tower, and many other local
Breakfast culture attractions such as Sunday Market
21)  Provides rooms are eco-friendly noise proofed designed
 Individual reading light and additional adaptor for phone charging on
every bed
 Provides in-house local tour desk for booking your local travel trips
such as Mount Kinabalu and islands hop-in a day trip and many more.
 Able to host up to 40 guests.

Lavender  Located in the heart of the shopping and entertainment hub

Lodge  5-minute walk to Center Point Mall and Complex Asia City.
 Provides free Wi-Fi throughout its building.
 Private bathroom offering hot water supply. An iron and hairdryer are
available upon request.
 Sightseeing arrangements and car rental services are available at the
24-hour front desk.
 Guests have access to a common lounge where there is a pool table
and satellite TV. Laundry services are available.

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 X-Plorer  Walking distance to shopping centers, eateries, restaurants, banks,
Backpacker post-office, express bus terminals, ferry terminals to the islands as well
as the weekly Sunday Bazaar.
 Free tour consultant and arrangement
 Provides Wi-Fi, cable TV with on-demand movies, a laptop-compatible
safe, pay television
 Offers airport transfer, which will take a 15-minute drive to get to Kota-
Kinabalu International airport.
 Offer dry cleaning and shopping service

Sri  Free WiFi access in the apartments

Sembulan  Fully furnished, apartments come with wardrobes, a washing machine,
Guesthouse dining table and a living room with sofa and satellite TV. The kitchen
includes a cooking stove, fridge, electric kettle and kitchenware. Private
bathrooms offer shower facility.
 Airport transfer services can be arranged upon request at a surcharge.
 free parking space on site
 Situated in the heart of Kota Kinabalu. (5 min to Imago Mall &
Gleneagles Hospital) KKIA Terminal 2 AirAsia (5 min).

Beacon  Provides guests with a free car park and an elevator.

Home @  Rooms come with complimentary Wi-Fi, climate control, cable TV with
Riverson on-demand movies, pay television and a safe.
Soho  The apartment features a kitchen for guests' comfort.
 Guests can exercise in a fitness room
 The apartment offers a year-round outdoor pool.

3.1.2 Indirect Competitor

The major source of indirect competitor for excessive Luxury Bed & Breakfast concerning on
conference facilities will appear from schools, universities, and the city hall. Some visitors
prefer to sleep at their friend’s or relative’s homes against to staying at a local Bed &
Breakfast. This situation encourage in terms of cost saving. Aside from that, some visitors
prefer shared cost arrangements with local inhabitants.

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3.2 Operation

In B&B industry, its importance for the new owner to understand the operating expense to
ensure the business are making profit and to adjust the business practices according to the
current economic situation. Hence there a few main operating costs that the owner must
take concerns about;

1. Labor
According to Hotel Propeller (2014), if the owner employee staff to run the
operation, 47% of operating costs spending in labor of service industry. Guarantee
of quality service to customer must be provide by enough numbers staffs, or else
guests will have to wait for a long time to get service. Hence, owner should learn
how to forecast demand for guest rooms and determine the level of staff needed for
any given period. For example, during peak seasons, a larger number of
housekeeping staff as well as restaurant staff was required.
2. Utilities
There approximately 6% of operational budget spend on utilities. These included
lighting, heating and use of other electronics. Hence, owners can reduce their cost
by reducing energy consumed. For an example, carrying out an energy audit of your
B&B which able determine exactly how energy is being consumed and identify areas
where you can save on costs.
3. Property Maintenance
Property Maintenance costs are hard to classifying, it neither variable costs nor fixed
costs. It can be defined as all the expense related to activities that are required to
ensure the B&B facility able to continue running. For example, owner should ensure
that the filters in air conditioner are cleaned regularly, to provide a more
comfortable environment for the customer. Maintenance of equipment that done
regularly able to save up some unwanted cost spending to purchase a new unit.
4. Marketing Costs
Marketing Costs is necessary for B&B industry to attract potential customer.
Marketing can be applied in various way which including social media marketing,
radio ads, TV ads, newspapers ads and online ads. Method to save up for marketing
costs includes taking advantage of free online marketing opportunities. Owner can
Use social media to engage with your target audience. For an example, create a
Facebook page to introduce your B&B and activities that could be done while staying
here.

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4.0 SWOT Analysis

Strengths Opportunities
- Large selection of
- Marketing to baby
available properties
boomers
- Reasonable prices
- Adding amenities
- Marketing/ Social
- Expand the business
Media

Weaknesses Threats
- Home owners - Legal Issues
discrimination cases
- Similar business
- Small size and a
- Bad press
limited number of
rooms
- Operating costs

Figure 4: SWOT Analysis

Strengths

The location of a bed and breakfast is one of the most important decisions a
business owner will need to make. A bed and breakfast that has a great location can have a
significant influence on the cash flow and the number of its customers. Having a bed and
breakfast that is easy to find for guests, and offering a peaceful atmosphere will influence
people to visit the B&B. The location is minutes from shopping, dining, hiking trails,
museums, historical and recreation sites for water sports, etc. After that, the business model
enables bed and breakfast to compete with low prices as compare with hotels and guest
houses. The use of internet will help in marketing the bed and breakfast on an international
scale. The website should have all the information a guest will need and ensure that the
B&B is easy to contact by posting a phone number and e-mail address on every page. As we

11
know, both guests and travelers focus on rating and review system, which provide trust and
safety the bed and breakfast online community.

Weaknesses

After allegations of discrimination from home-share owners were brought to light,

some of the customers are unwilling to book a room of B&B because they are afraid to these
problems happen to them. The small size and limited number of rooms affects the amount
of sales to be made for a bed and breakfast establishment. The rooms of a bed and
breakfast are less than its competitor such as hotels, so it limits the amount of money to be
made yearly. Furthermore, the operating costs of a bed and breakfast are considered high
as a full residential facility must be maintained.

Opportunities

Baby boomers are a big audience and they make up one of the largest sectors of
consumers, so B&B should be paying attention to effective marketing strategies for baby
boomers. Generational studies show that about 70 million people fall into the category of
baby boomers. The baby boomer generation is the largest segment of consumers,
comprising about 40% of the market share. In order to increase the income of a bed and
breakfast, adding amenities does allow a bed and breakfast to charge more for their
services. After that, the owners of B&B can expand their bed and breakfast businesses
usually do so by establishing additional locations or expand their business other than their
core business model. For example, travel guides, car rentals.

Threats

There are a number of legal issues that need to be aware for the owners of bed and
breakfast such as having appropriate guest house insurance, employer’s liability insurance
and health and safety responsibilities. Failure to adhere to local zoning laws can result in
fines and other legal complications can cause a bed and breakfast to be shut down by their
local government. B&B also faces the threat from its competitor such as hotels and resorts
due to substitute products and services will come from cheap alternatives offered in the
market. If the competitor conduct the promotions may affect the customers of B&B to
change their decision of staying in B&B. Bad press is a threat to B&B that are internet based
that rely on browser searches to gain more users. The owners of B&B should be proactive in
monitoring reviews to prevent the loss of potential clients.

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 5.0 Porter Five Force Model

Porter Five Force Model for Bed & Breakfast (B&B) in Malaysia

Threats of New
Entrants

 Barriers to entry
 Differentiation

High

Intensity of Rivalry

High Low
Bargaining Power Moderate Bargaining Power
of Suppliers -The competitive power of of Buyers
rivalry players
 Number of suppliers - The structure of competition.  Number of the
- Switching costs consumer
 Easy or complicated
- Market growth  Price sensitive
to forward integrate
customer
product  Limited information
High
 Uniqueness of
product or services Threats of New
 Buyer sensitivity Substitutes

toward prices and

 Consumer switching costs
knowledge
 Prices of substitute product or
regarding the
services
product
 Substitute product or services quality
 Substitute performance

Figure 5: Porter Five Force Model

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 B&B industry has experienced a rapid growth for these recent years in Malaysia
economy. This is because Malaysia has some of the most attractive holiday destinations
such as Kuala Lumpur has 88-storey PETRONAS Twin Towers, Penang is a popular beach
spot in Malaysia, Malacca is famous from historic point of view due to the Portuguese
colonization here from 1511 to 1641, and Kota Kinabalu has bustling markets, modern
boardwalk, beaches, waterfront Kota Kinabalu City Mosque, and also 4,095m high Mount
Kinabalu. All of these destinations will attract more tourists and even backpacker to travel.
So Malaysian B&B industry has a potential to continue to grow rapidly in coming years, on
the back of increasing the promotional activities by the government and growing the
country’s symbolic as a shopping hub and innovation building.

In order to know the level of competition of B&B industry in Malaysia and

particularly in KK area, we will use the “Porter’s five forces of competition model” as show in
the Diagram 1. This model is created by Michael Porter mentioned in his book “Competitive
strategy: Techniques for analysing industries and competitors”. This model is a framework
that attempts to analyse the level of competition within an industry and business strategy
development. According to Porter (2000), there have five forces that determine the industry
attractiveness and long-run industry profitability. These five “competitive forces” are
intensity of rivalry, threats of new entrants, bargaining power of buyers, threats of new
substitutes, and bargaining power of suppliers. All of these forces will led to more
understanding the dynamics of competitive structure in the B&B industry.

i. Threats of New Entrants (High)

According to Porter (1980), the threat of new entrants are determined by the
barriers to entry which include the economics of scale which include size and scope
operations required to meet the viable cost structure, product differentiation, and customer
loyalty created by the reliability, quality, and brand image. Besides, the threats of new
entrants to an industry also come from the increased pressure on costs, prices and even the
rate of the investments (Porter, 2008). In the other word, it can results in intensified
competition that can affect the overall profitability of an industry. If the barriers to entry
remain high, the threat of new entrants will be low.

The initial investment in the B&B industry creates a quiet of barriers to the entry
but some barriers to enter the B&B market can be reduced by the Internet. The presence on
the many effective communication channels through Internet will reduces the upstart
marketing costs somewhat and it gives the entry of new competitors from domestic or

14
foreign country to the potential resources and suppliers. A main barrier is the
differentiation. The B&B hotels can be succeeding when they can differential itself by the
geography (location), amenities, services or other quality that has the larger potential to
attract the potential consumers and keep the consumers. Besides, another barrier to entry
into the B&B industry would be the expertise. In the mobile society, employees will quit the
career and work in the competitor’s company and they take that expertise in terms of the
experience with them or the training given. It is in the fields of the differentiation and the
expertise, the B&B hotels can make the bigger impacts on its consumer and thereby on the
bottom line. Many B&B hotels have the synergies between their established the business
and business channels.

ii. Bargaining Power of Buyers (Low)

Buyers are the people who create the demand in an industry. The bargaining of
buyers determines how much the buyers can impose the pressure on margins and volumes.

The B&B hotel price normally changes are cheaper, B&B hotel has been considered
as a cheaper option for the most price-sensitive customer. Besides, taking into account
that B&B industry is not like as company that may bargain on the price of the room due to
the high number of consumer they may take to involved in B&B industry, but is mainly
composed by the individuals the bargaining power of buyer is low. However, buyer’s
bargaining power can contribute by many buyers if there are many suppliers in B&B
industry. It means buyers (tourists) have low bargaining power today in Malaysia and
particularly in KK since B&B industry is still in developing stage, which means B&B business
not penetrate in accommodation industry yet. with a strong hot economy. Based on the
statistics of Tourism Malaysia (2017), there are around 25.9 million tourists visited Malaysia
in 2017 and 2,562,208 tourists visited in Sabah (increase 5.4%).

In Addition, most of the buyers only have limited information about the B&B
business in KK area and this will disadvantage in negotiations with those B&B suppliers. For
instance, most of them just provide simple information like Azs Bed and Breakfast in Kota
Kinabalu only list down its address, contact and amenities only in Google without price and
more photos. Even though there is limited information, the buyers can online book the B&B
hotel which they prefer. They no longer need the corporate travel consultants and travel
agents of any kind to determine where they will stay. It will efficiently to eliminate the
intermediaries. As for all, the B&B industry not like others industries that consumers can

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purchase a large portion of an industry’s total output and bargain the price with the owner.
So, the bargaining power of buyers is low.

iii. Threat of the substitution (High)

The threat of substitution affects the competitive environment for the organizations
in that industry and influences their ability to achieve profitability because consumers can
choose to purchase the substitute instead of the industry's product. Which means in this
force is to studies how easy it is for consumers to switch from a business product or services
to that of a competitor. It looks at how many competitors are in the B&B industry, the most
essential for the B&B suppliers is their prices and quality, that point will be a comparison
between the suppliers and as an advantage for the buyer. The threat of the substitution in
B&B industry is consider high, the reason being are as follow:

 Consumer switching costs are low

This is because there are many types of accommodation business in KK area and this
will cause customers can easily switch to another B&B suppliers or substitute services such
as hotel, hostel, home stay and cottage that meet their expectation and requirements as the
costs are low.

 Substitute product or services is cheaper than industry product

The major customer base for B&B industry usually are backpacker, couple or family
that wish to have a budget travelling, they will take price as a key consideration for
purchase decision. Thus, customers tend to have more advantage over suppliers in B&B
industry since there are many substitute accommodation services such as “low-cost”
accommodation businesses like hostel and cottage can be a choice list for them.

 Substitute product or services quality is equal or superior to industry product quality

As mentioned above, there are many substitute accommodation services such as

“low-cost” accommodation businesses like hostel and cottage or big businesses as the
hotels. With small difference of prices, if these substitutes have more quality product or
equal quality but provide more service to the customers, customers will switch to substitute
business that offer more quality service than B&B. For instance, consumers might prefer to
stay in hotel which provided more complete services than B&B which serve only breakfast or
no food provided but basic cooking are available.

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  Substitute performance is equal or superior to industry product performance

In the case of the hospitality industry, there are including many types of businesses
such as hotels, motels, hostels, serviced apartments, cottage and also B&B. Each one of
these offer products and services different from the other but they are performing the same
function. For example, a hotel offers services and products as swimming pools, spas, luxury
treatments and restaurant services. A B&B instead allows tourists to experience a country
from within and allows deepening their knowledge thanks to direct contact with the locals.
Both the hotels and the B&B anyway perform the same function which is overnight stay. The
performance difference between the two is that hotels are generally offer ancillary services
that may attract more the tourist and the rooms may be more “luxurious” than B&B. B&B
instead offer hospitality for a cheaper price, of course fewer services than hotels. Therefore,
within the same industry there are businesses that offer different type of services and
products performing anyway the same function. Hence, concluded that the threat stemming
from producers of substitute goods is high.

iv. Bargaining Power of Suppliers (Moderate)

According to porter, suppliers can exert bargaining power over participants in an

industry by threatening to raise prices or reduce the quality of purchased goods and
services. Powerful suppliers can thereby squeeze profitability out of an industry unable to
recover cost increases in its own prices. Therefore, this force is studies how much power
B&B industry suppliers has over the potential to raise its price, which in turn would lower
business profitability. To define the power of suppliers in B&B industry it may depending on
some factors such as (i) it looks at the number of suppliers available in the industry,
the fewer there are, the more power they have (ii) whether suppliers can easily
forward integrate or begin to produce the buyer’s product themselves (iii)
whether the supplier’s product or services is highly differentiated or common (iv)
how buyer sensitivity with the prices and their knowledge regarding the product
or services.

The modern B&B operator, usually is the owner of the house or it is run by family
members and may be located at the same premises as the owners reside. Hence, the
facilities provide might be quite small and limited but the operator can offer tailored
customer service and some additional features upon request. Besides that, the owner has a
completely different attitude and involvement from simple suppliers of rooms for tourists,
the owner will warmly welcome guests at arrival, provide them with general information

17
about the local culture and territory and sometimes shares with its customer’s interests and
hobbies. In contrast, provides a different mode with other serviced-based types of
accommodation industry.

In addition, the key suppliers for the accommodation industry are labor and real
estate. For instance, if buyer choose to stay in hotel instead of B&B, the switching costs is
high because hotels prices usually higher than B&B due to they provide accommodation with
a high level of privacy, food and beverage services that vary from basic to refined, and other
but they charge customers for usage of all the services and facilities according to relevant
regulations. Consequently, if those buyers are more sensitive to the prices, the power of
B&B supplier is high. For smaller businesses like B&B which required less capital and low
cost may have a little more power of bargaining but due to the high availability of real
estates, the bargaining power of suppliers is moderate. For hotels, it would require more
capital and high cost for their entire operation and management and high skilled laborers
with a greater bargaining power may be required.

v. Intensity of Rivalry (High)

According to Porter (2008), the intensity of rivalry as a major determinant of the

competitiveness of the industry takes many forms, including the price discounting,
sustainable competitive advantage through the innovation method, new product and service
introduction, service improvements, level of advertising expense and degree of
transparency. This is rivalry can be formed with the more differentiated strategies which
take the action by the industry participants. It can be decreased with more differentiated
strategies or can be increased with same strategies.

The competitive power of rivalry players in Bed & Breakfast (B&B) industry is fierce.
When the potential customers find and identify the B&B hotel on line, the Internet will
reduces the differences amongst the competitors. The businessman prefer to the best prices
for the best experience with reducing the prices to a competitive level in the market. B&B
industry covers wide area so it will increase the number of the competitors because this
industry market is too widely. For example, the 88-storey PETRONAS Twin Towers is the
main attraction in the Kuala Lumpur, tourist who wants to spend the time in this tourist
attraction place can easily choose a B&B hotel in the nearby of this place. Besides, if there
are numerous competitors offer the same or almost the same kind of products and services
such as B&B industry, the market’s attractiveness will be reduced. So the competitors will
lead an aggressive pricing and promotion to attract more consumers. In B&B industry, the

18
consumer’s switching cost is quite low and they can change the B&B hotel anytime. Not
only for that, there are many equally sized competitors (structure of competition) exist in
the B&B market. All of these reasons comes the result of degree rivalry is very high.

Besides, the homestays with the B&B model pose a threat to the market shares of
the hoteliers. At May 2016, there are 5,542 registered of this kind of homestays in the
Malaysia. According to Honorary Secretary General Malaysian Association of Hotel, he said
that in 2018, the B&B have about 17,000 listings in Malaysia, in the city center itself there
are about 5,000 listings. Besides that, Brickfields ranking third in the world emerge as a top
growth neighborhood (1,230% growth). The Brickfields is home to Little India with a colorful
maze of textile and jewelry stores, low-key restaurants serving banana leaf curries and Dou
sha pancakes which is located at Kuala Lumpur. The business people see this place has a lot
of the potential to develop a B&B industry. So, there have many B&B hotels were developed
nearby the Brickfields.

19
6.0 PESTEL Analysis

Political
- Government policy
- Political stability

Economic
- Economic growth
- Inflation

Social
- Population growth
- Cultural events

Technology
- Competitive advantages
- Changed the way businesses operate

Environment
- Prevent environmental and cultural degradation
- Designed to encompass sound sustainable environmental
practices

Legal Factor
- Affect how a hotel operates, its costs, and the demand for its products in
tourist industry.

Figure 6: PESTEL Analysis

20
 i. Political
Political is the activity, action and policy of a government in a country. The political
factors play an important role in a country because the political decision will affect the
economy of the country. The main target of the bed and breakfast (B&B) hotel is to attract
the foreign tourists. Nowadays, the foreign tourists are increase gradually. For example, the
tourists come from China, Korea and others were increase compared to past years. The
government needs to support the B&B hotel to sustain in a competitive world. Government
will charge the great amount of tax on the star category of hotels. Political change will have
a direct impact of government and it will affect the B&B hotel. The small step taken by the
government will directly affect the hotel industry. For example, if the government charges
the foreign tourists expensive tourist tax it will cause the quantity of foreign tourist will be
fall. Political stability is good for the hotel industry because the tourism will be flourishes
without any of turmoil. For example, Malaysia is a political stability country so there are
many of foreign tourist visit to Malaysia. A single terrorist event will deeply affect the
tourism in that area. For example, Semporna Sabah has few kidnapping Chinese tourist it
affect the activities and hotel industry in that area. A stability political country and good
policy government will attract many of foreign tourists.

ii. Economic
Economics is a social science and used to study how people satisfy unlimited wants with
scarce resource. Economic factor is including inflation, economic growth, exchange rates
and interest rates. Majoriti of the foreign tourists travel to a country for the purpose of
business dealing, workshops conferences and others. B&B hotel capitalize the tourist
because they will bring great money and they will have a huge expectations about the B&B
five-star hotels. The income of the people rise will let them have extra money to travel. The
income increase it will be a good sign for hotel industry. The economy situation in 2016 is
good and this is a positive signs in 2017. The condition of economy will influence the
purchasing power in the tourists. When the economy condition is flourishing its means that
the consumer’s purchasing power will be increase and they are able to spend more on
leisure activities. The exchange rates also will influence the tourists to visit to a country. For
example, when Ringgit Malaysia was fall others country such as Singaporean they can get
more Ringgit Malaysia. It will increase the purchasing power of the Singaporean.
Singaporean can choose the five-star B&B hotel as their first choice when their purchasing
powers increase.

21
iii. Social
The social factor will affect the demand for firm service and products. Nowadays, population
of Malaysia is about 32,000,000 peoples. The government of Malaysia is encouraging the
Malaysian to give birth more because the population is still unsatisfied yet. Malaysia is a
multi-ethnic country such as Malay, Chinese, India and others. The different ethnic will have
its own different culture. Every ethnic cultural have their own interesting and attract people.
For example, foreign tourist come to Malaysia they found that Malaysia has many of
different culture. In Malaysia, tourists can found mosque, Chinese temple, Hindu temple,
Church and others. Malaysians is a nice and passion people, they are always helping each
other. The cultural events also will help B&B hotel, when the cultural events started the
tourists will be increase. For example, Sabah’s Harvest Festival will conduct in 31 May every
year. It will attract the tourist come to Sabah to visit and learn the culture of Sabahan.

iv. Technological

Technological factors are also important fact which effect to the B&B industry in many ways
which are comprises the utilization of the latest inventions and technologies facilitate the
business activities which are digital telephone facilities, broadband Internet connection, Wi-
Fi technology, multimedia projector, LCD screens, online reservation systems, property
management software and online information exchange program (Point of Sale) etc.

Now a day’s technology is rapidly changing in the world day by day. It will help the
organization to have competitive advantages. Technology can used to reservation, online
services like online booking, do the promotions.

The rapid development of technology is affecting the businesses in all over the world.
Changes in the technology have changed the way businesses operate i.e. Internet booking
for tickets and holidays.

Faster changing development in technology creates a need to react quickly for different
businesses in order they want to maintain the competitive environment by providing the
same innovative services, which their competitors are offering.

22
 v. Environment

When we promote tourism there are thousands and thousands of tourists unleashed
annually in the country, without proper planning, there is bound to be serious environmental
and sustainability issues. Such large-scale and fast track growth has to be carefully planned
and managed within specific tourism zones to prevent environmental and cultural
degradation.

Individual hotel developments will not suffice. Such well-planned, large-scale tourist resorts
can be designed to encompass sound sustainable environmental practices (e.g., common
self-contained sewage disposal facilities with recycling of water, solar lighting for resort
public areas, no-build green belts within resorts, etc).

Such organized and well-managed, large-scale developments contained in several

designated zones will help mitigate most of the possible negative fallout of the socio-cultural
and environmental aspects. Building and subsequent maintenance should be under strict
environmentally-sustainable guidelines.

vi. Legal Factor

When concerning about the legal factors include tourism act, discrimination law, consumer
law, employment law and health and safety. These factors can affect how a hotel operates,
its costs, and the demand for its products in tourist industry.

23
 7.0 Key Findings

7.1 To find what locals feel about bed & breakfast in the tourism industry.

7.1.1 Attitudes towards B&B Development

B Item 1 2 3 4 5 6 7
I SD D RD N RA A SA
L Bi % Bil % Bil % Bil % Bil % Bil % Bil %
l
A The community 3 0.86 3 0.86 15 4.29 51 14. 127 36. 97 27. 54 15.
T should stimulate 57 29 71 43
1 a more
intensive
building of B&B
facilities.
A B&B plays and 1 0.29 4 1.11 23 6.39 59 16. 117 32. 103 28. 43 11.
T important role 39 5 61 94
2 in the economy
of the
community.
A Local authorities 0 0 2 0.57 11 3.06 66 18. 120 33. 96 26. 55 15.
T are right if they 33 33 67 28
3 support B&B
development.
A Overall, the 1 0.29 2 0.57 20 5.56 65 18. 123 34. 91 25. 48 13.
T economic 06 17 28 33
4 benefits
generated by
B&B
development
are greater than
the
negative ones
A Overall, the 2 0.57 3 0.86 20 5.56 79 21. 119 33. 89 24. 38 10.
T positive socio- 94 06 72 56
5 cultural impacts
generated by
the B&B
development
are
greater than the
negative ones
A Overall, the 0 0 11 3.06 37 10.2 93 25. 88 24. 85 23. 36 10
T positive 8 83 44 61
6 environmental
effects
generated by
B&B
development
are
greater than the
negative ones

24
 AT6

AT5

AT4
Item

Agree
AT3 Neutral
Disagree
AT2

AT1

0 10 20 30 40 50 60 70 80 90
Percentage (%)

According to the table and chart above, question AT1 asked the respondents about
whether the community should stimulate a more intensive building of B&B facilities, have
score highest in Agree sector (RA=36.29%+A=27.71%+SA=15.43%) which resulted in total
79.43%, conquer the major score in this question. While 14.57% (51 respondents) choose
Neutral section, those respondents might not have any idea on this or they were either
agree or disagree to AT1. Last, minority respondents accounted for only 6.01%
(SD=0.86%+D=0.86%) are Disagree to AT1.

Question AT2 discussed respondent’s opinions about whether B&B plays an important role in
the economy of the community. 73.05% (RA=36.29%+A=27.71%+SA=15.43%)
respondents are in agree sector to AT2, 59 respondents which accounted of 16.39% choose
Neutral section while only 7.79% (SD=0.29%+D=1.11%+RD=6.39%) of respondents are in
Disagree sector, they do not think B&B such an important role in the economy of the
community.

For question AT3, it is about whether local authorities are right if they support B&B
development. Most of the respondents are Agree with this, which accounted for 75.28% in
total (RA=33.33%+A=26.67%+SA=15.28%). There are 18.33% (66 respondents) choose
Neutral and only 3.63% (SD=0%+D=0.57%+RD=3.06%) Disagree with local authorities
have to support B&B development.

25
There are 72.78% (RA=34.17%+A=25.28%+SA=13.33%) respondents are Agree to AT4
which in overall, they think the economic benefits generated by B&B development are
greater than the negative ones. 18.06% (65 respondents) are maintain their opinion on
Neutral section while 6.42% (SD=0.29%+D=0.57%+RD=5.56%) respondents are Disagree
with AT4 statement.

Question AT5 is about whether or not the respondents agree that in overall the positive
socio-cultural impacts generated by the B&B development are greater than the negative
ones. The result from the questionnaires stated that about 68.34%
(RA=33.06%+A=24.72%+SA=10.56%) are Agree with AT5 and 21.94% respondents
choose Neutral section to maintain their opinion for this. Only 6.99%
(SD=0.57%+D=0.86%+RD=5.56%) respondents are Disagree with AT5 statement.

For the last question AT6 in this part is asked the respondents what is they opinion in this
statement “Overall, the positive environmental effects generated by B&B development are
greater than the negative ones”. 58.05% (RA=24.44%+A=23.61%+SA=10%) of
respondents Agree that in overall the positive environmental effects are greater than the
negative ones. There are 25.83% (93 respondents) choose Neutral section and 13.34%
(SD=0%+D=3.06%+RD=10.28%) of respondents are Disagree with AT6, they think B&B
development will generate greater negative environmental effects.

In overall, locals give positive feedback or attitude towards B&B development as from the
total 350 respondents, most of them are given their opinion on Agree sector for question
AT1 to AT6 and the total number in Agree sector (Rather Agree, Agree and Strongly Agree)
is 1529 compared to 413 opinions that under Neutral section and there are only 158
opinions are in Disagree sector (Strongly Disagree, Disagree and Rather Disagree) for the
statement provided. Among AT1 to AT6, question AT1 “The community should stimulate a
more intensive building of B&B facilities.” score highest, which is 79.43% agree to the
question statement. This might indicate that this kind of accommodation industry is
acceptable by local’s peoples and they have a positive view towards B&B development in
their area. Thus, government should encourage the B&B development because it can
provide more options for tourist or traveller at the same time attract them come to Malaysia
and this will stimulate the economic.

26
 7.1.2 Impacts of Tourism Development

B Item 1 2 3 4 5 6 7
I SD D RD N RA A SA
L Bil % Bil % Bil % Bil % Bil % Bil % Bil %
N Settlements in 16 4.57 30 8.57 67 19. 93 26. 83 23. 34 9.7 27 7.71
E this residence 14 57 71 1
1 should not
initiate the
attraction of a
great number of
visitors.
N Tourism related 12 3.43 31 8.86 61 17. 104 29. 96 27. 32 9.1 14 4
E business such 43 71 43 4
2 as B&B has a
negative impact
on the
environment
preservation
N The noise from 11 3.14 29 8.29 58 16. 89 25. 111 31. 36 10. 16 4.57
E the existing 57 43 71 29
3 tourist activities
has a negative
impact on the
life in my
place.
N In my place the 10 2.86 22 6.29 54 15. 71 20. 125 35. 44 12. 24 6.86
E amount of 43 29 71 57
4 rubbish has
risen due to a
larger number
of tourists.
N Tourism 21 6 25 7.14 81 23. 99 28. 79 22. 34 9.7 11 3.14
E reduces the 14 29 57 1
5 possibilities for
the recreation
outdoors in my
place.
N Tourism has 23 6.57 32 9.14 63 18 138 39. 54 15. 29 8.2 11 3.14
E influenced the 43 43 9
6 rise of crime
rate in my
place.
N Tourists have a 20 5.71 37 10.5 69 19. 147 42 52 14. 17 4.8 8 2.29
E negative impact 7 71 86 6
7 on my place.

27
 NE7

NE6

NE5
Items

NE4 Agree
Neutral
NE3
Disagree

NE2

NE1

0 10 20 30 40 50 60
Percentage (%)

As shown in the table and chart above, question NE1 asked the respondents opinion
about the “settlements in this residence should not initiate the attraction of a great number
of visitors.”, about 41.13% (RA=23.71%+A=9.71%+SA=7.71%) of respondents are in
agree while 32.28% (SD=4.57%+D=8.57%+RD=19.14%) of respondents are disagree to
NE1. There are 26.57% (93 respondents) choose Neutral section, those respondents might
not have any idea on this or they were either agree or disagree to NE1.

Question NE2 discussed respondent’s opinions about whether they think tourism related
business such as B&B has a negative impact on the environment preservation. There are
40.57% (RA=23.43%+A=9.14%+SA=4%) of respondents are in agree sector to NE2, which
means that most of them respondents perceive that tourism related business will cause
negative impact to the environment. While for neutral section is 29.71% (104 respondents)
and disagree sector is 29.72% (SD=3.43%+D=8.86%+RD=17.43%) which the percentages
are about the same.

For question NE3, it is about whether the noise from the existing tourist activities has a
negative impact on the respondent’s life in their place. Most of the respondents are Agree
with this, which accounted for 46.57% in total (RA=31.71%+A=10.29%+SA=4.57%)
means almost half of the respondents think the tourist activities have huge impact to them
in their place. There are 28% (SD=3.14%+D=8.29%+RD=16.57%) respondents Disagree
with NE3 and 25.43% (89 respondents) choose Neutral section.

28
There are 55.14% (RA=35.71%+A=12.57%+SA=6.86%) of respondents are Agree to NE4
which most of the respondents think the amount of rubbish has risen due to a larger
number of tourists visited to their place. However, 24.58%
(SD=2.86%+D=6.29%+RD=15.43%) of respondents are Disagree with NE4 statement
while about 20.29% (17 respondents) are maintain their opinion on Neutral section.

Question NE5 is about whether or not the respondents agree that tourism reduces the
possibilities for the recreation outdoors in their place. The result from the questionnaires
stated that about 36.28% (SD=6%+D=7.14%+RD=23.14%) of respondents do not agree
with NE5. But still have 35.42% (RA=22.57%+A=9.71%+SA=3.14%) of respondents are
Agree the tourism reduces the possibilities for the recreation outdoors and 28.29% (99
respondents) choose Neutral section to maintain their opinion for this.

For question NE6 in this part is asked the respondents how was their opinion about the
statement “Tourism has influenced the rise of crime rate in my place.” In this question, most
of the respondents choose in Neutral section which accounted for 39.43% (138 respondents)
while 33.71% (SD=6.57%+D=9.14%+RD=18%) of respondents are Disagree with NE6,
they do not think the rise of crime rate in their places is because of the tourism. However,
26.86% (RA=15.43%+A=8.29%+SA=3.14%) of respondents are agree that tourism will
cause the rise of crime.

The last question NE7 is whether or not respondents agree that tourists have a negative
impact on their place. From the result show that most of the respondents which accounted
for 42% (147 respondents) are not sure about whether those negative impact is because of
tourists or others reason. But still, 35.99% (SD=5.71%+D=10.57%+RD=19.71%) of
respondents think tourists did not come out negative impact on their place. Hence, they are
not agree with NE7. Next, the rest of the respondents with 22.01%
(RA=14.86%+A=4.86%+SA=2.29%) do agree those negative impacts arise in their place is
because of the tourists.

In conclusion, the result shows a negative attitude of local towards tourism development
and tourists and there are a lot of impacts due to the tourism development towards the local.
because the total number of agree sector in attitude towards tourism development is 937
out of 2450 which occupied 38.24%. Next, total number of disagree sector from NE1 to NE7
is 772 (31.51%). Which show that there is also part of the respondents perceive that is less
impact of tourism development to local. Thence, 741(30.25%) is for neutral section. Hence,
since majority of respondent show a negative feedback towards the development of tourism

29
industry in kota kinabalu due to respondents perceived there are some negative impacts
arise such as environment and crime problem where been affect they daily life in their
community, where this will likely affect the development of B&B industry in the local areas
as many locals might against to those developments in order to protect their rights as a part
of the resident in their community. Therefore, it is important to take care of local’s welfare
while develop the tourism related business such as B&B.

30
 7.2 To identify the attitude of locals towards tourist and tourism

7.2.1 Attitudes toward Foreign Tourists

B Item 1 2 3 4 5 6 7
I SD D RD N RA A SA
L Bi % Bil % Bil % Bil % Bil % Bil % Bil %
l
F I like foreign 1 0.29 5 1.43 10 2.86 73 20. 123 35. 83 23. 55 15.
T tourists. 86 14 71 71
1
F I favor foreign 0 0 4 1.14 9 2.57 74 21. 130 37. 82 23. 51 14.
T tourists. 14 14 43 57
2
F I welcome 0 0 1 0.29 7 2 48 13. 122 34. 93 26. 79 22.
T foreign tourists. 71 86 57 57
3
F I am positive 2 0.57 0 0 7 2 58 16. 126 36 88 25. 69 19.
T about foreign 57 14 71
4 tourists.

FT4

FT3
Items

Agree
Neutral
FT2
Disagree

FT1

0 10 20 30 40 50 60 70 80 90
Percentage (%)

From the table and chart above, question FT1 to FT4 is to identify about how was
locals attitudes towards the foreign tourist that come to Kota Kinabalu. The highest one is
74.56% (RA=35.14%+A=23.71%+SA=15.71%) of respondents chosen in agree sector for
FT1 statement which means most locals are like foreign tourists. For neutral section it is
shows that there are 20.86% (73 respondents) were either agree or disagree with the
statement. The lowest is 4.58% (SD=0.29%+D=1.43%+RD=2.86%) in disagree sector,
indicates they were lowest respondents dislike foreign tourists.

31
The majority respondents were agreed with FT2, approximately 75.14%
(RA=37.14%+A=23.43%+SA=14.57%) of respondents signify they favor foreign tourists.
Approximately 21.14% (74 respondents) were maintain their opinion for this statement.
Meanwhile, only 3.71% (SD=0%+D=1.14%+RD=2.57%) of the questionnaire respondents
disagreed with FT2.

Followed by FT3, there are 84% (RA=34.86%+A=26.57%+SA=22.57%) of respondents

welcome foreign tourists to visit kota kinabalu. The secondary was 13.71% (48 respondents)
chosen in neutral section and the lowest is in disagree sector which accounted for 2.29%
(SD=0%+D=0.29%+RD=2%) of respondents does not like the foreigners or tourists to visit
kota kinabalu.

For FT4, the highest percentage is 80.85% (RA=36%+A=25.14%+SA=19.17%) in agree

sector in which respondents viewed that they choose agree because they are always
positive about foreign tourists. There are 16.57% (58 respondents) chosen in neutral section
for this statement. The lowest percentage is 2.57 (SD=0.57%+D=0%+RD=2%) for FT4,
indicates they were lowest respondents in previously (FT1-FT3), already have a negative
perception about foreign tourists.

As a conclusion, the result for FT1 to FT4 is consistently, where all the highest percentage is
in agree sector and the lowest percentage is always in disagree sector while the percentage
in neutral section are more on average. In view of this, it is possible to conclude that most
of the locals are having positive attitudes towards foreign tourists.

32
 7.2.2 Willingness to Support Tourism and B&B Business

B Item 1 2 3 4 5 6 7
I SD D RD N RA A SA
L Bi % Bil % Bil % Bil % Bil % Bil % Bil %
l
P Kota Kinabalu 1 0.29 3 0.86 7 2 20 5.7 73 20. 100 28. 146 41.
K has a great 1 86 57 71
1 potential in
tourism.
P Kota Kinabalu 0 0 0 0 7 2 20 5.7 84 24 99 28. 140 40
K should expand 1 29
2 its tourism
related
business.
P Kota Kinabalu 0 0 2 0.57 10 2.86 30 8.5 82 23. 99 28. 127 36.
K has performed 7 43 29 29
3 well in tourism
development.
P Kota Kinabalu 0 0 3 0.86 8 2.29 31 8.8 77 22 121 34. 110 31.
K has a great 6 57 43
4 potential in B&B
business.
P Kota Kinabalu 0 0 3 0.86 5 1.43 30 8.5 90 25. 108 30. 114 32.
K should expand 7 71 86 57
5 its B&B related
business.
P Kota Kinabalu 0 0 2 0.57 8 2.29 49 14 76 21. 109 31. 106 30.
K has performed 71 14 29
6 well in B&B
development.

PK6

PK5

PK4
Items

Agree
PK3 Neutral
Disagree
PK2

PK1

0 20 40 60 80 100
Percentage (%)

33
The table and chart above shows the results for the locals willingness to support tourism
and B&B Business in Kota Kinabalu. For PK1 is about how the locals think the potential of KK
in tourism, the results reveal that approximately 91.14%
(RA=20.86%+A=28.57%+SA=41.71%) of respondents agreed Kota Kinabalu has a great
potential in tourism. There are 5.71% (20 respondents) chosen neutral for PK1 statement
while only 3.15% (SD=0.29%+D=0.86%+RD=2%) are not agreed with it.

As seen from the table, 92.29% (RA=24%+A=28.29%+SA=40%) of the respondents are in

agree sector with PK2 stated that Kota Kinabalu should expand its tourism related business.
For neutral section, it is still 5.71% (20 respondents), which some respondents either agree
or disagree with PK2. Only few respondents which accounted for 2%
(SD=0%+D=0%+RD=2%) disagree to expand the tourism related business.

According to the questionnaire, 88.01% (RA=23.43%+A=28.29%+SA=36.29%) of

respondents agree to PK3 in which they think Kota Kinabalu has performed well in tourism
development, 8.57% (30 respondents) either agree or disagree while 3.43%
(SD=0%+D=0.57%+RD=2.86%) do not think KK has well perform in tourism development.

For PK4 is to identify whether locals think that Kota Kinabalu has a great potential in B&B
business, the results is alike with the PK1 since most of the respondents are agree that kk
has a great potential in tourism, therefore 88% (RA=22%+A=34.57%+SA=43%) are in
agree sector which they think KK has a great potential B&B business as there are great
potential of tourism in KK. For neutral section is accounted for 8.86% (31 respondents)
while the lowest is in disagree sector with 3.15% (SD=0%+D=0.86%+RD=2.29%).

Based on the results for PK5 and PK6, there are actually related question which is to define
the views of locals about whether Kota Kinabalu should expand its B&B related business and
did they think Kota Kinabalu has performed well in B&B development. The results show that,
there are 89.14% (RA=25.71%+A=30.86%+SA=32.57%) agreed with PK5 indicates that kk
should expand B&B business and there are 83.13% (RA=21.71%+A=31.14%+SA=30.29%)
also agreed with PK6 means they think Kota Kinabalu has performed well in B&B
development. For neutral section, there are 8.57% (30 respondents) for PK 5 and 14% (49
respondents) for PK 6 respectively. Consequently, both PK5 and PK6 lowest percentage are
in disagree sector which is 2.29%(SD=0%+D=0.86%+RD=1.43%) for PK5 and 2.86%
(SD=0%+D=0.57%+RD=2.29%) for PK6.

From the result of PK1 to PK6, it can be concluded that the willingness for locals to support
tourism and B&B business in Kota Kinabalu is positive. Since agree sector conquer the major

34
score rather than neutral section and disagree sector in all the questions. According to
Mohamad Zaki Ahmad, (2012) stated that, even though tourism development has generated
positive impacts for a certain destination in terms of economy, environmental and social
state by uplifting the socioeconomic status of the local community, improving the quality of
the environment and enhancing the relationship between tourists and the locals.

However, tourism industry precipitated several negative impacts too such as economic
leakage, environmental degradation and disturbances on the local community such as noise
pollution and social problems. Hence, comprehensive and solid planning is vital to warrant
perpetual satisfaction and benefits for local and tourists. Excellent planning will take account
each aspect before execution stage of a development while arising problems can be
managed by blueprinting several appropriate measures. This will find a long-lasting
development and positive impacts constantly added and eventually bringing satisfaction to
tourists who will enjoy the tourism havens especially Malaysia.

35
8.0 Conclusion

In conclusion, based on the data collected, the result shows that locals give positive
feedback or attitude towards B&B development although there a lot of impacts due to the
tourism development towards the local. In corresponds towards second objectives, result
show that local are having positive attitudes towards foreign tourists and willingness for
locals to support tourism and B&B business in Kota Kinabalu are shown in positive value.

However, the impacts of tourism development towards local people should not be
distinguishing, it should be given concerned. Malaysia has a competitive sustainable tourism
plan, which has a strong linkage with the goals of public, private and NGOs’ goal on socio-
economic development. However there is a significant gap in incorporating policies on the
macro level of the tourism system. Hence, it would be a better plan in reality, if the
sustainable tourism strategy could be integrated with other management functions and
actions whose strategy should be implemented. An example could be given was local
transport and car rentals. In a survey by The Expat, a Kuala Lumpur-based magazine, taxis
are rated “the worst [for]quality, courtesy, availability and ride experiences” in a sampling of
200 foreigners from 30 countries. “The drivers are road bullies and extortionists, a national
shame and pose a serious threat to the country’s tourism industry”, the survey found. (Y.
Sulaiman, 2008). From the above survey it is clear that the implementation part of
sustainable tourism has yet to be achieved.

There are several implementation can be undergo by government such as Ministry should
recognizes the imperative role of the private sector and specifies roles for all sectors of
federal, state and local authority, private business, NGOs and other players. A more
integrated approach to tourism planning and management should be undertaken through
preserving as well as enhancing the existing and natural and cultural assets. In addition, the
role of the State Tourism Action Councils (STAC) should be further expanded to include
regular monitoring and evaluating of project outcomes. At the local level, local authorities
and communities are encouraged to have a more active role from the beginning of the
projects so as to minimize environmental destruction. For businesses, such as hotels and
resorts, they “will need to incorporate, among others, water and energy conservation as well
as waste disposal aspects in the implementation, management and maintenance
plans” (EPU, 2006). More emphasis must be put on the preservation of the natural
attractions to enhance ecotourism as well as preservation of the heritage tourism such as
historical sites, buildings and artifacts that are categorized under preservation of the natural
attractions.

36
9.0 Reference

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