In the European Union, small and medium-sized enterprises (SMEs) account for nearly the entire business landscape, representing 99.8% of non-financial sector companies. They employ approximately 65% of the workforce and generate over half of the total added value. These figures highlight that the growth of tourism is not driven solely by large-scale investments but primarily by thousands of small, locally operating businesses.
The travel and tourism sector is one of the key pillars of the European economy. Its total contribution is estimated in the trillions of euros annually, and it is associated with roughly 11% of overall employment in Europe. In countries such as Croatia and Spain, tourism accounts for a particularly high share of GDP, making the sector crucial for the stability and growth of local economies.
Despite their strength, small and independent units face growing challenges. Large hotel chains benefit from strong brand recognition, organized booking networks, and greater access to capital. This allows them to invest in technology, marketing, and enhanced services, further strengthening their competitive advantage.
Research shows that chain-affiliated businesses are more frequently rated positively regarding financial performance compared to independent units. This difference is attributed to better revenue management, easier access to international markets, and cost-sharing capabilities within the group.
On the other hand, small hotels continue to retain significant advantages. Personal interaction with guests, flexibility in decision-making, and the authenticity of the experience are aspects that large, standardized units struggle to replicate. In many destinations, local identity and distinctive hospitality remain closely tied to small businesses.
The challenge for the coming years is to strengthen the competitiveness of small units without losing the character that makes them unique. Access to financing, the adoption of digital tools, and collaboration at the destination level can serve as catalysts for sustainable growth.
In a rapidly evolving sector, the “invisible giants” of European hospitality continue to play a decisive role. The balance between the dynamism of large chains and the vitality of small businesses will shape the future of tourism in Europe.