“…On the one hand, a lot of competition in the segment of hotels of a similar standard could reduce the profitability of a future hotel, on the other hand it can bring the classic benefits of the agglomeration effect (Canina, Enz & Harrison, 2005;Chung & Kalnins, 2001;Egan, Chen & Zhang, 2006;Yang & Fik, 2011;Yang, Wong & Wang, 2012;Zhang, Guillet & Gao, 2012). According to a study by Chen and Dimou (2005), in case of financially strong foreign hotel chains with well-known brands, the second aspect is predominant. On the other hand, a large number of businesses operating on the local tourism market may negatively affect location decisions.…”