Why do travel agencies choose to undergo IPOs in Taiwan?

Abstract

Travel agencies have seen an increasing number of firms going public in recent years. This study explores and empirically examines the initial public offering (IPO) strategy model for travel agencies by adopting a three-round Delphi research design. Qualitative interviews with the 13 travel agency chief executive officers and related experts provided additional insights. The result shows that Taiwanese travel agencies consider 9 internal motivations, 8 external environment forces, and 11 determinants for the decision to go IPO and 10 performance indicators post-IPO. Finally, the model herein illustrates how travel agencies can realize IPOs’ strategic goals by increasing the performance of travel agency post-IPO.

Keywords

environment force initial public offerings motivation performance travel agency.

Introduction

There has been a wave of tourism-related companies choosing to raise equity capital in Taiwan’s stock exchanges since the 1990s. Traditionally, only big hotels could raise equity capital in the stock markets, but some large travel agencies and firms in the entertainment theme park segments of Taiwan’s hospitality industry have gradually begun to see the stock market as an attractive source to finance new projects, expand operations, or just start up new businesses (Chen and Chen, 2004) on the back of Chinese tourists being allowed to travel to Taiwan starting in July 2008. This was not only a breakthrough for cross-strait tourism but also an important milestone in the history of Taiwan’s tourism development (Chang et al., 2014). As Taiwan has been increasing its efforts to lure Chinese tourists in recent years, the travel industry has become a prosperous and important national industry.

Travel agencies in this island nation play an important role in tourism and travel-related industries, whereby according to Taiwan’s Tourism Bureau, there was a total of 2920 travel agencies at the end of 2016. While six travel agencies chose to conduct initial public offerings (IPOs), most travel agencies in Taiwan operate on a relatively smaller scale. In 2001, Phoenix Travel started to publicly trade on Taiwan’s over-the-counter market, and although it does not have the largest profit in the local industry, it is the most open and has the most transparent corporate governance.

The reasons for a firm to undergo an IPO are some of the most important, yet least studied questions in the travel agency industry. Some research studies have examined IPOs on the Taiwan Stock Exchange, but they ignore travel agencies (Chen, 2012, 2014; Chen and Chen, 2004, 2010; Huang, 1999; Linda, 1996; Shen and Wei, 2007). Thus, it is an interesting topic to further investigate if travel agencies behave differently from other travel-related industries when undergoing an IPO in Taiwan’s stock markets.

Theoretical background

IPO refers to a privately owned company selling shares to the general public for the first time and hence becomes publicly held (Chen and Chen, 2010). Under Taiwan’s current China open policy, various benefits have arisen from the tourism policy reform that has allowed Chinese tourists to travel to Taiwan. However, the rapid development of Taiwan’s travel agency industry brings up several concerns: What are the travel agencies’ internal motivations for going public? Why do travel agencies choose to go public under external environment forces? What might be the crucial factors for them to decide to undergo an IPO? What is the performance of post-IPO?

What is the internal motivation for a travel agency to undergo an IPO?

Most travel agencies’ cash flow is plentiful, and therefore an IPO plan is not just based on a firm’s demand for capital from the equity market. The main reason for wanting to undergo an IPO is to achieve stronger brand identification and brand trust. At the same time, the company expects to strengthen its management through the IPO process, because its structure will be thoroughly examined by the interested public. Companies also go public not to finance future investments and growth but to diversify their investment portfolio (Shen and Wei, 2007). IPOs are also followed by a lower cost of credit, and public firms are more profitable. Other motivations for going public include overcoming borrowing constraints, greater bargaining power with banks, liquidity and portfolio diversification, monitoring, investor recognition, change of control, and windows of opportunity (Pagano et al., 1998). Through their analysis of the banking industry, Rosen et al. (2005) provide empirical support that banks that go public tend to have higher profits and more leverage in addition to being greater in size than their counterparts that choose to remain private. Travel agency owners generally make more effort to differentiate their products from their peers, thus enhancing their competitiveness, which in turn stimulates sales and profitability, even when public sentiment in the tourism sector goes down during a slowing economy. Despite all these facts, little attention has been paid on analyzing the internal motivation for a travel agency to go public.

Why do travel agencies choose to undergo an IPO under external environment forces?

IPOs are almost always risky, with risk confronting the three parties involved: issuer, investment banker, and investors (Ibbotson et al., 1988). The IPO process is known for its asymmetric information among investors (Miloud, 2016), and how to reduce the asymmetric information between investors and consumers is also important for the travel industry. Firms may time their IPO in order to take advantage of “windows of opportunity” (Paleari and Vismara, 2007). For some firms, an IPO can be the most advantageous means of raising capital to facilitate future growth, but it is also associated with a substantial amount of risk and uncertainty. Despite the uncertainty and risk associated with going public during an economic downturn, some firms still proceed with their IPO (Latham and Braun, 2010).

Competition level, entry barriers, labor conditions, and technological developments all play a crucial role in determining the success or failure of IPOs in the aftermarket (Baluja and Singh, 2016). Although external factors might impact the design and development of their business model, travel agencies choosing to do an IPO may see a sustainable competitive advantage to their businesses, as it directly benefits customers’ purchase decisions and enhances customer relationships. By considering to expand their business scope and to have a global travel brand, travel agencies may be able to adapt to the major external environmental forces that stem from competitors and market conditions. Therefore, some travel agencies are eager to go public in order to acquire better firm performance under external environment forces.

Determinants of the decision to go public

The IPO decision is unique for every firm. The previous literature presents the following variables as significant indicators of the size of an offering and the IPO decision made by the firms: firm size, current assets, profitability, and leverage (Babich and Sobel, 2004; Borghesi et al., 2015; Zingales, 1995). If entrepreneurs had but one chance to go public, they would simply trade off the benefits and costs of an IPO and choose their best course of action accordingly. Therefore, the decision to go public entails more than just a straightforward comparison of immediate costs and benefits and should have a significant impact on firm value and firm risk (Benninga et al., 2005; Peterle and Berk, 2016). Moreover, the demand for capital may be more important to the decision to go public than market conditions (Lerner, 1994).

There has been a wave of travel-related companies choosing to raise their equity capital in Taiwan’s stock exchanges since the 1990s. Traditionally, only large-scale hotels, restaurants, and theme park entertainment firms could raise equity capital in the Taiwan stock markets, but lately a few travel agencies have gradually begun to develop the capital proceeds from the IPO that are necessary for strategic growth initiatives (innovation, acquisition, etc.). As such, the decision to abandon a public offering can significantly impact the firm and its shareholders versus proceeding with it (Latham and Braun, 2010). Managers optimally choose the timing of the IPO transaction to take advantage of a temporary improvement in performance (Cai and Wei, 1997).

What are the performances of travel agencies that conduct IPOs?

The fastest growing segment of the global hospitality industry is gaming-related businesses. This industry has experienced record numbers of companies going public, and their stocks are considered favorable long-term investments (Atkinson and LeBruto 1995; Hensler et al., 2000). However, strategies that invest in IPOs have underperformed the overall market in the long run (Reddy, 2015; Ritter, 1991). Taiwan’s tourism IPOs are smaller in size and their long-run stock performances are also quite poor (Chen and Chen, 2004).

An IPO’s performance is measured by operating return on assets, profit, profit margin, equity capital turnover, cash flow, and the firm’s size and age (Aguiar-Quintana et al., 2016; Bruce and Thilakaratne, 2014; Durukan, 2002; Kurtaran and Er, 2008; Yong, 2007). IPO firms are generally unable to sustain their pre-issue performance levels, even though they display high post-issue growth in sales and capital expenditures (Abrahamson et al., 2011; Jain and Kini, 1994; McGuinness, 2016). In other words, while investors who are interested in hospitality stocks can invest in them, they need to hold risk-free assets rather than stocks to achieve better investment performance (Chen, 2010). Travel agency owners, conversely, engage in strategic options with lower risk consequences at the expense of maximizing firm performance and owners’ wealth.

There is a lack of research in the literature as to why few travel agencies go public, and many refrain from doing so in Taiwan. The findings from this study should help shed some light on the various issues involved for travel agencies.

Objectives of this study

Though external environment forces and internal motivations are crucial determinant factors that influence the decisions of travel agencies to go public, no empirical research has examined IPO-related issues for the travel agency industry. Consequently, there are four specific objectives of this project as follows.

Conduct a qualitative approach on target travel agencies. Their responses shall present much better insight into their internal motivations for undergoing an IPO.

Learn how travel agencies choose to go public under external environment forces and offer additional insights from different types of travel agencies in how to better target their IPO strategic activities.

Identify the underlying determinants of adopting an IPO strategy for travel agencies so as to discover better practices for upgrading their performances and for pursuing stronger brand identification.

Provide meaningful methods to practitioners of travel agencies to help increase their performance after their IPO by developing their brand equities and thereby achieving management scale.

Methods

To achieve the objectives of this study, we adopt a Delphi research design. The research design focuses on primary travel agencies to obtain more in-depth information and to identify the critical variables. This approach is recommended when the theory is more tentative and the measures are less well developed, because the findings will be regarded as indicative (Babbie, 1995). As no previous research exists on IPO issues for Taiwan’s travel agencies, this study employs exploratory research. Both primary and secondary data are therefore essential. Given the dynamic nature of the subject area, multiple primary research approaches were adopted, including both qualitative and quantitative methods (Phillip, 1998). Bryman (1998) explains that the two methods are complementary rather than competing, especially for exploratory research.

This study looks to discover what panel experts regard as the most important internal motivations, external environment forces, and determinants of the decision to go public, as well as the performances of travel agencies that did undergo an IPO. Thus, a three-round Delphi survey method helps develop the conceptual framework (see Figure 1).

Figure 1.

Framework of exploring travel agency industry’s IPO strategy. IPO: initial public offering.

Sampling

This study group consists of experts who are directly involved with travel agency management, practitioners, or researchers, including travel agent chief executive officers (CEOs), owners, Chairmen of Taiwan’s main city associations of travel agents, the Chairman of the Certified Travel Counselors Association of the Republic of China, and related travel agency issue researchers. All these respondents are important people and have valuable knowledge on practical travel agency management issues, which helped us obtain in-depth and valuable opinions and comments on the subject. The semi-structured interviews ranged from 40 min to 60 min in length.

The panel of experts was recruited using a snowball technique. This is a judgment sampling technique that utilizes the researcher’s ability to locate an initial set of respondents with the desired characteristics. These individuals are then used as informants to identify other potential respondents with the desired characteristics. This type of sampling technique is considered appropriate for exploratory research when searching for ideas or insights (Churchill, 1999). In this manner, the initial respondents are identified through the researcher’s personal networks. They are then asked to recruit respondents on the researcher’s behalf, and likewise these respondents execute the request for seeking out the next set of respondents (Schoefer and Ennew, 2004). The Delphi group size does not depend on statistical power, but on group dynamics, to arrive at a consensus among experts. Thus, the literature recommends 10–18 experts on a Delphi panel (Okoli and Pawlowski, 2004; Paliwoda, 1983). It has also been reported that the validity and the reliability of the Delphi technique do not significantly improve with more than 30 participants (Adams, 2001). Others report that exceeding 30 participants results in fewer new ideas, regardless of group size (Dalkey and Helmer, 1963). This study group consisted of 13 final snowball sampling target experts, who were both travel agent practitioners and CEOs and included respondents from all six travel agencies listed on the stock market. The travel agencies included in the survey are Lion Travel, Star Travel, Ezfly, Life Tour, Phoenix Tours, and Richmond Tours. All these endeavors were aimed at determining the critical factors that measure the IPO strategy model in the travel agency industry.

Related Delphi surveys (Green et al., 1990; Kaynak and Macauley, 1984; Miller, 2001; Seely et al., 1980) adopt the mean score value to measure the control tendency and the standard deviation value to measure the degree of convergence. If, after the second round, there is any attribute with a standard deviation greater than 1, a value of quartile deviation that is greater than 0.6, and Kendall’s W coefficient of concordance not indicating a 1-perfect consensus, then another Delphi round will be undertaken. In this situation, the ranking questionnaire must be resent to the members of that panel. To increase the convergence in round two from round three, a few statements are rewritten and restated. The third-round Delphi survey showed a satisfaction level in convergence and reconfirmed the above dimension attributes of the IPO strategies in the travel agency industry. In the end, this study used a three-round Delphi survey on these 13 experts to develop, validate and prioritize a baseline list of potential evaluation criteria within the strategic model dimension of developing competitive advantages through an IPO.

Data analysis

The three-round Delphi survey used experts in the field of travel agency industry management. To improve the indicators’ validity, convergence, consensus, and concordance, we utilized four criteria: (1) the standard deviation value of each attribute should not be greater than 1; (2) the mean score value rounded down 0.4 or rounded up 0.5 in units should be equal to the value of the mode; (3) the value of the quartile deviation should range from 0 to 0.6, with less than 0.6 indicating strong consensus and 0 indicating a perfect consensus, and range from 0.6 to 1, with 1 indicating no consensus (Holden and Wedman, 1993); and (4) Kendall’s W coefficient of concordance should have a value of W ranging from 0 to 1, with 0 indicating no consensus and 1 indicating perfect consensus between lists (Schmidt, 1997). If any attribute did not match two of the four criteria, then the next survey round began. The experts’ data were then analyzed, ending with the results shown in Table 1.

Table 1.

Delphi result of IPO strategy model dimensions.

Construct	Factor	M1	Standard deviation	Quartile deviation	Ranking	Kendall’s W
Internal motivation	Strengthen management (m ₁)	4.83	0.40	0.50	1	0.23
	Strengthen corporate control (m ₂)	4.83	0.40	0.50	1
	Build an organization system (m ₃)	4.66	0.51	0.50	3
	Decrease employee turnover (m ₄)	4.50	0.54	0.25	4
	Acquire finance monitoring (m ₅)	4.50	0.54	0.50	4
	Leverage in addition to being greater in size than counterparts (m ₆)	4.50	0.83	0.50	4
	Finance future investments (m ₇)	4.16	1.16	0.50	7
	Acquire a lower cost of credit (m ₈)	4.00	0.89	0.50	8
	Acquire finance liquidity (m ₉)	4.00	0.63	0.50	8
External environment force	Expand business scope (n ₁)	5.00	0.00	0.00	1	0.41
	Achieve brand identification (n ₂)	5.00	0.00	0.00	1
	Achieve brand trust (n ₃)	5.00	0.00	0.00	1
	Acquire competitive advantage (n ₄)	4.83	0.40	0.12	4
	Enhance customer relationships (n ₅)	4.66	0.51	0.50	5
	Develop a global travel brand (n ₆)	4.66	0.81	0.25	5
	Acquire better firm performance (n ₇)	4.66	0.51	0.50	5
	Acquire windows of opportunity (n ₈)	4.16	0.40	0.12	8
Determinants of the decision to go public	Deliver market value (o ₁)	5.00	0.00	0.00	1	0.33
	Strengthen growth initiatives (o ₂)	4.66	0.51	0.50	2
	Decrease management risk (o ₃)	4.66	0.51	0.50	2
	Strengthen vertical merge capability (o ₄)	4.50	0.54	0.50	4
	Strengthen horizontal merge capability (o ₅)	4.50	0.54	0.50	4
	Attract source to finance new projects (o ₆)	4.33	0.51	0.50	6
	Decrease organization risk (o ₇)	4.33	0.51	0.50	6
	Expand firm size (o ₈)	4.00	0.63	0.25	8
	Increase firm current assets (o ₉)	4.00	0.63	0.25	8
	Increase R&D budget (o ₁₀)	4.00	0.63	0.25	8
	Trade off between benefits and costs (o ₁₁)	3.66	0.81	0.25	11
The performance of post-IPO	Strengthen branding value (P ₁)	5.00	0.00	0.00	1	0.30
	Operate return on age (P ₂)	4.83	0.40	0.12	2
	Align firm organization culture (P ₃)	4.66	0.51	0.50	3
	Strengthen commercial services platform (P ₄)	4.66	0.51	0.50	3
	Operate return on firm’s revenues (P ₅)	4.50	0.54	0.50	5
	Operate return on firm’s employees (P ₆)	4.50	0.54	0.50	5
	Operate return on cash flow (P ₇)	4.33	0.51	0.50	7
	Operate return on equity capital turnover (P ₈)	4.16	0.40	0.12	8
	Operate return on profit (P ₉)	4.00	0.63	0.25	9
	Strengthen currency exchange performance (P ₁₀)	3.83	0.75	0.12	10

Note: IPO: initial public offering; R&D: research and development.

Findings

The results of the Delphi analysis yield several insights that confirm previous findings and shed light on the future of an optimal IPO strategy model in the travel agency industry.

The model and propositions

Founded on the theories of IPO strategy and based on the findings, the author proposes an IPO strategy model for the travel agency industry as shown in Figure 1. Propositions associated with the model are discussed below.

Proposition I: Internal motivations may impact the determinants of the decision to go public.

The main motivations for the IPO are to strengthen management (m ₁) and corporate control (m ₂). At the same time, the practitioners expect to build an organization system (m ₃) and acquire finance monitoring (m ₅), liquidity (m ₉), and future investments (m ₇) through the IPO process, making sure their leverages are greater in size than their counterparts (m ₆). Moreover, an IPO can decrease employee turnover (m ₄) and help the firm acquire a lower cost of credit (m ₈) after the IPO. Indeed, travel agency practitioners should take the lead in understanding and facing intensified global competition, instead of being driven by their competitors that are already achieving those IPO advantages and using the IPO process as a major step to maximize own profits. Previous research by Pagano et al. (1998) found similar insights into the motivations to go public.

Proposition II: External environment forces of IPOs may enforce the determinants of the decision to go public

Prospective travel agent practitioners are able to gain useful information in order to develop an optimal IPO strategy in the travel agency industry. Following the success of the e-commerce business model, a few large travel agencies now cover most of Taiwan’s total market share, having gradually gained a sustainable competitive advantage (n ₄) and developed a global travel brand (n ₆). Travel agencies considering IPOs can expand their business scope (n ₁) and achieve stronger brand identification (n ₂) and trust (n ₃). As a result, the travel agency industry has enhanced customer relationships (n ₅), acquired windows of opportunity (n ₈), and exhibited better firm performance (n ₇). The above external environment forces have also been studied by other researchers and have also been found to be significant in determining the decision to go public. Hence, incumbent IPO travel agencies may acquire advantages through an IPO strategy in the aftermarket. These external environment forces of IPOs have been identified in other studies such as Baluja and Singh (2016).

Proposition III: The determinants of the decision to go public may result in the performance after going IPO.

Test results generated from this study shed more light on the determinants of the decision to go public in the Taiwan travel agency market. Those practitioners believe that making more effort to deliver market value (o ₁), attracting sources to finance new projects (o ₆), expanding firm size (o ₈), and increasing the firm’s current assets (o ₉) over their peers will also help in the trade off between the benefits and costs (o ₁₁) after an IPO. In addition, the travel agency can increase its research and development budget (o ₁₀) with the aim of strengthening growth initiatives (o ₂), vertical merger capability (o ₄), and horizontal merger capability (o ₅) and decreasing organization risk (o ₃), even when public sentiment in the travel industry falls down from the impact of an economic recession. The above variables have proven to be significant indicators of the decision to go public for IPO incumbent travel agencies. These determinants have been identified in other studies such as Chen and Chen (2004).

Proposition IV: There are clear performances in the right determinants of the decision to go public.

What is the performance of travel agency IPOs following the open tourism policy of granting permission to Chinese tourists to travel to Taiwan? The determinants of the decision to go public are generally based on the trade off between risk and returns. Thus, travel agent practitioners’ decision to go public can be interpreted as an attempt to strengthen their branding value (P ₁), commercial services platform (P ₄), and currency exchange performance (P ₁₀), while at the same time aligning firm organization culture (P ₃). To analyze a firm’s performances after an IPO, we focus on the return on a firm’s revenues (P ₅), return on age (P ₂), a firm’s employees (P ₆), cash flow (P ₇), equity capital turnover (P ₈), and profit (P ₉) as operating performances. Abrahamson et al. (2011) conclude that the clear performance index is determined in such a way that it maximizes the firm value. It is more important than ever for incumbent IPO travel agencies to seek out an effectual means of protecting their market advantages against the onslaught of competitive threats, particularly with respect to raising barriers to imitation. Hence, it is essential for travel agency practitioners to evaluate the IPO performance of strategies on their strategic management practices and to determine how to benefit from them.

Implications for management

Some research has been done concerning IPOs on the Taiwan Stock Exchange, but they ignore the travel agency market. Thus, it is an important topic to further investigate whether travel agencies behave differently from other related travel industries in the stock IPO markets of Taiwan. Going public allows travel agencies to strengthen management and acquire finance liquidity to accelerate growth in order to achieve a global travel brand. Therefore, its major contributions are twofold: first, it identifies which of the 38 factors are perceived as important or not so important by the majority of executives involved in this study; second, it presents the underlying internal motivations, external forces, determinants of the decision to go public, and the IPO performance indicators of the travel agency industry’s IPO strategies. Before IPO decisions are made, it is highly crucial for travel agencies to assess the importance and the existence of internal motivations or external environment forces so as to choose the optimal decision concerning the IPO and to take advantage of improvements in performance. If the incumbent IPO travel agencies have competitive advantages or take advantage of windows of opportunity to invest in the future, then the potential for new entrants to compete is risky unless these entrants have superior advantages.

Conclusions and recommendations

This study demonstrates that the motivations of going public mean that the owners give up private benefits of control for the added value of being a publicly traded travel agency. The contributions of this study are finding the relationships among CEOs’ or owners’ internal motivations, external environment forces, and determinants of their decision to go public, as well as the performances of travel agencies after listing. Travel agency CEOs or owners clearly should be able to recognize and target an IPO strategy, in addition to those identified herein, that provides clues as to the vulnerability of their own travel agency. This study offers a conceptual overview of travel agency CEOs or owners who are focused on building up IPO strategies based on the results of qualitative approaches from Taiwan’s major travel agencies.

Several important recommendations can be drawn from this study. Both traditional and online travel agents have to adapt to change, whether from the invention of a new technology, an innovative business model, or a quick shift in travelers’ purchasing preferences. The key issues for travel agents are how to survive new trends and overcome disintermediation. The findings herein identify a portable IPO strategic model in the travel agency industry, which should benefit travel agency strategic management.

Taiwan’s Tourism Bureau is currently actively encouraging local travel agencies to develop their own brand and to incorporate it with their business mode of management. The Tourism Bureau is pushing to amend related regulations, providing complementary measures such as management and assistance. Encouraging the local travel agency industry to develop branding strategies and management scale is an inevitable policy. For practitioners in Taiwan’s travel agency industry IPO market, to acquire a high level of performance, they should explore internal motivations and lessen external environment forces. Moreover, these practitioners should examine determinants of the decision to go public for their own firms. Future research needs to address the profitability of the IPO strategy model. Incumbent travel agencies should also keep several things in mind when developing IPO strategies, such as the following.

Internal motivation

Why do travel agencies choose to go IPO? IPO firms are not motivated by financing needs or constraints while they do build branding value. The main motivations of an IPO are to strengthen management and corporate control and to build an organization system through the IPO process. Large-scale travel agents are more inclined to seek public listing due to their desire to diversification, in addition to being greater in size than their counterparts. Unfortunately, some firms do not successfully decrease employee turnover after IPOs.

External environment force

Most travel agencies still do not achieve a stronger brand identification and trust from consumers, even as they expect to gradually obtain a sustainable competitive advantage and develop a global travel brand. With the uncertainty of external environment forces nowadays, travel agencies considering IPOs can expand their business scope so as to enhance customer relationships. Most travel agencies may also employ an IPO strategy to acquire windows of opportunity stemming from heavy competition and market conditions.

Determinants of the decision to go public

A travel agent’s IPO is deemed to be one of its most important milestones in order to deliver greater market value and to strengthen growth initiatives. When travel agencies move to public ownership, they decrease organization risk and thus form competitive advantages. Nevertheless, some travel agencies do not totally succeed in realizing their planned IPO. In fact, if medium-sized or large-scale travel agencies cannot develop competitive advantages through the IPO process, then new entrants or other incumbents will erode the benefits of these travel agencies.

Performance from going IPO

IPOs in the travel agency industry generally outperform the stock market in the first year after issue. Compared to post-IPO operating performance, the expected returns are still favorable. To achieve better performance, travel agencies must develop an IPO strategy by raising barriers to competition in order to strengthen their branding value and align their firm organization culture. Therefore, the expected return on a firm’s revenues can be realized.

Limitations of the study

The framework provided in this article is useful to improve our understanding of an IPO strategy in the travel agent industry. This is the first study to investigate the internal motivations, external forces, determinants of the decision to go public, and IPOs’ performance indicators for IPO strategies in the travel agency industry. As with any case study, the findings cannot easily cover other travel-related industries. Additional studies in other industries may strengthen the generalization of the proposed constructs and framework.

There are some limitations to the research approach followed in this study. First, the Delphi method was based on respondents from 13 major travel agencies or experts with travel agency management experience in Taiwan. Hence, random data collection sampling techniques could not be used, prompting several limitations in the results. Second, snowball sampling is a nonprobability approach that may lead to sampling bias, hence limiting the general applicability of the findings. These limitations, however, do not diminish the significant contributions this study makes to the research literature. A future study may provide a longitudinal overview of the development of IPO strategies in the travel agency industry. It is also our hope that this study stimulates more interest in IPOs for this industry and that other researchers will build upon and extend this study’s findings.

Footnotes

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This work was supported by the National Science Council of the Republic of China in Taiwan under Contract (MOST 104-2410-H-328-006-MY2).

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