Comparative Analysis of Profitability Assessment Models in Business Tourism: a Comprehensive Approach Based on the Case of Uzbekistan

Introduction

The business tourism industry – commonly referred to by the acronym MICE (Meetings, Incentives, Conferences, Exhibitions), an area of the tourism sector associated with the organization of corporate events [5] – is one of the key drivers of the global economy. The global MICE market in 2017 amounted to USD 805 billion, with a projected increase to USD 1.44 trillion by 2025 [14]. The sector generates substantial financial flows, accounts for up to 60% of hotel revenues worldwide [11], and has a powerful multiplier effect on related industries [3; 7]. Business travelers spend three to four times more than leisure travelers [27], underscoring the high profitability of this segment. Despite its evident economic significance – often illustrated by a strong correlation between revenues from MICE events and macroeconomic indicators such as GDP and foreign direct investment (FDI) (Pearson’s r_xy up to 0.98) in the top‑10 leading countries [28] – assessing the true profitability and effectiveness of projects in this field poses a major methodological challenge. It is important to stress that a strong correlation does not necessarily prove a one‑way causal link. The success of the MICE industry may be not so much a driver as an indicator of overall economic well‑being. It is more accurate to conceptualize this relationship as a “virtuous cycle”, whereby the development of MICE and macroeconomic indicators mutually reinforce one another.

The relevance of this topic is particularly high for Uzbekistan, where tourism is recognized as a strategic sector of the economy, as enshrined in the “Concept for the Development of Tourism in the Republic of Uzbekistan for 2019-2025” [9]. The country has demonstrated impressive dynamics: between 2016 and 2019, the number of international visitors increased fivefold – from 1.3 to 6.7 million [1]. However, as studies of the Uzbek market note, the development level of MICE tourism is still unsatisfactory due to the lack of necessary regional infrastructure and a dedicated development concept [11]. Thus, there is a discrepancy between the region’s enormous potential [16; 21] – bolstered by its rich cultural heritage (over 8,200 sites) – and the shortage of evidence‑based tools for assessing and planning investments in MICE infrastructure [1].

The problem lies in the fact that traditional approaches to profitability analysis (an efficiency indicator defined as the ratio of profit to costs or invested resources [12]), borrowed from other industries, do not always adequately reflect the specifics of the MICE industry. Classical financial indicators such as return on assets (ROA) and return on equity (ROE) fail to account for long‑term non‑financial benefits: destination image enhancement, business network development, and social and cultural exchange [2; 15]. As many researchers note, there is a pressing need to transition from purely financial metrics to more holistic, integrated approaches [26].

The degree of scholarly coverage can be characterized as fragmented. A significant body of work is devoted to analyzing individual financial models. Fundamental here is the DuPont model, which decomposes return on equity into key drivers: profit margin, asset turnover, and financial leverage [4]. In their work, L. I. Novikova and A. M. Stratila enhanced the classical model using the example of Moldova’s construction sector, expanding it to nine indicators including cost breakdown (depreciation intensity, material intensity, payroll intensity, other expense intensity) and income from other activities. O. S. Yumanova emphasizes the importance of factor analysis in Russia but notes differences in its application: for travel agents the analysis is driven by gross income and selling expenses, whereas for tour operators the key factor is the cost of the tour product [12].

At the same time, recent research increasingly points to the limitations of exclusively financial approaches. The systematic review by C. Sampaio, M. Régio, and J. R. Sebastião shows a clear shift in hotel performance research from financial indicators to a comprehensive perspective that includes such non‑financial parameters as sustainability, corporate social responsibility, stakeholder perceptions, and customer satisfaction [26]. This trend is corroborated by A. Hayes, who describes the Balanced Scorecard (BSC) as a tool linking financial metrics with three other perspectives: customer (satisfaction, loyalty), internal processes (efficiency of internal business processes), and innovation (learning and development) [20].

Accordingly, the literature lacks a systematic juxtaposition of methods and a comprehensive model for evaluating MICE profitability that integrates financial and non‑financial indicators – particularly as applied to the specifics of Central Asia.

This study presents a comparative analysis of existing profitability assessment models in business tourism in order to identify their limitations and to outline the prospects for using comprehensive approaches. To this end, we solve a series of tasks: we systematize and classify the main models and performance indicators; compare the advantages and disadvantages of different groups of models (financial, operational, socio‑economic, and integrated); and, based on this analysis, substantiate the need to transition to comprehensive assessment models, especially for developing tourism markets such as Uzbekistan. The outcome is a set of practical recommendations for industry professionals on selecting and adapting relevant assessment models.

Materials and Methods

This study is an analytical report based on a structured review and synthesis of data extracted from academic and industry sources, including journal articles, monographs, research organization reports, and conference materials. While it does not claim to be a “systematic review” under formalized protocols (e.g., PRISMA), it follows a clear logic for selecting and analyzing relevant literature to minimize bias. Data collection was carried out through targeted selection of publications relevant to the assessment of economic efficiency and profitability in tourism, with a special focus on the MICE segment.

Both quantitative and qualitative data were used. Quantitative data included macroeconomic statistics (MICE contribution to GDP, market volumes, dynamics of tourist flows), firms’ financial indicators (profitability ratios [18], cost structures), as well as results of surveys and econometric modeling presented in the primary sources. Qualitative data encompassed descriptions of methodologies, terminology, conceptual models, and authors’ findings from the analyzed works.

The analysis and presentation of information proceeded in several stages. First, a content analysis of all sources was conducted to identify and group the existing approaches to profitability assessment. Based on this, a classification was developed that divided the variety of models into four main categories: traditional financial models; models for assessing operational and marketing efficiency; models for assessing socio‑economic impact; and integrated models. For each group, the key characteristics were determined: principal indicators, application goals, required input data, advantages, and limitations. The analysis made it possible to compare the approaches by degree of comprehensiveness, universality, and applicability to the MICE context.

During synthesis, the results of the comparative analysis were summarized in a comprehensive table that clearly demonstrates the evolution of performance assessment approaches and the gap between traditional and contemporary models.

Thus, the methodology is comprehensive, combining methods of structured review, content analysis, comparative analysis, and synthesis in order to form an integrated view of the current state and development prospects of profitability assessment models in business tourism.

Results

The analysis of the sources made it possible to systematize existing approaches to assessing profitability and performance in the MICE industry. The diversity of models and indicators was consolidated into four key groups that reflect the evolution of methodological thinking – from narrowly focused financial calculations to comprehensive assessment of aggregate impacts. The results are presented in Table 1.

Table 1.

Classification and comparative characteristics of performance assessment models in the MICE industry

The table reveals a clear evolution from narrow financial metrics focused on internal efficiency toward comprehensive models evaluating aggregate macroeconomic and social impacts. Despite their rigor and standardization, traditional financial models prove insufficient for a holistic assessment. For example, analysis of the Russian hotel complex KrasnoyarskInvest LLC shows that even with a positive operating profit margin (24% in 2016), the overall return on assets (−0.04) and equity can be negative due to high leverage and uncovered losses [10]. Such risk analysis is highly relevant for Uzbekistan, where the government actively stimulates hotel construction through tax incentives and subsidies for global brands’ royalties [6]; without comprehensive assessment, such projects may be unprofitable in the long run.

Operational and marketing efficiency models offer valuable tools for tactical management. For instance, a study by H. Y. Lee et al. on South Korean firms [23] shows that to achieve 100% efficiency in export promotion, a company needs to participate in the same trade show at least three times. Such insights cannot be gleaned from standard financial statements, yet they are important for national exhibition operators in Uzbekistan, such as Uzexpocentre, when shaping strategies for international participation. However, these models do not allow the assessment of an organization’s aggregate results.

Socio‑economic impact models are critical for demonstrating the macro‑level significance of MICE. The Events Industry Council reported that in 2017 the global business events sector contributed USD 1.5 trillion to global GDP and supported 26 million jobs [19]. These data provide a strong argument for public investment in infrastructure. The main drawback is complexity and heavy data requirements – key challenges for Uzbekistan, where, as in many developing economies, sectoral statistics are still being formed, complicating the direct application of Input-Output models or satellite accounts.

Finally, integrated models – especially the BSC – are the most progressive approach. They overcome the limitations of purely financial metrics by linking them to key drivers of long‑term success: customer loyalty, quality of internal processes, and innovative capacity. M. M. Rekoria [25] confirms that firms implementing comprehensive sustainability strategies improve financial performance in the long term.

Thus, no single model category is universal. An effective profitability assessment system for business tourism should be hybrid, combining the precision of financial indicators, the tactical value of operational metrics, and the strategic orientation of comprehensive approaches.

Discussion

The principal conclusion from the results is that adequate assessment of profitability in business tourism is impossible without moving from one‑dimensional financial models to multi‑criteria, comprehensive systems. As Table 1 shows, each approach is useful for specific tasks but has substantial limitations. Traditional financial ratios, as demonstrated by O. S. Yumanova [12] and N. A. Shurmeleva [10] using Russian firms, effectively reveal the influence of factors such as cost of sales and selling expenses, but they fail to capture long‑term value creation – a hallmark of the MICE industry.

This conclusion aligns with the global trend in performance research. The bibliometric review by C. Sampaio and co‑authors, based on 560 articles, convincingly shows a shift from operational metrics (RevPAR, ADR) toward the effects of CSR, reputation, and innovation on business outcomes [26]. Similarly, the study by A. H. H. Al‑Ali and S. K. Al‑Shabeeb on Iraqi industrial firms demonstrates that different profitability indicators have heterogeneous effects on the maximization of market (MVA) and intrinsic (IC) value, corroborating the need for a differentiated assessment approach [13].

The novelty of our analysis lies in the systematization and direct comparison of these disparate approaches specifically in the context of the MICE industry. Whereas previous research focused either on macroeconomic contribution (e.g., C. Jones and S. Li’s MSA approach for the UK [22]) or on micro‑level efficiency (e.g., T. L. Sysoeva et al. calculating the ROI of a specific exhibition for a Russian company [8]), our synthesis shows that the approaches are complementary rather than contradictory. For example, high social significance as assessed by the method of Yu. V. Vorontsova and D. S. Garbuz [2] may justify a low direct financial ROI, since it generates long‑term reputational benefits for the destination. This is particularly important for Uzbekistan, where major international summits and festivals – such as the SCO summit in Samarkand or music festivals in Tashkent – have primarily image and political effects that standard financial metrics struggle to capture [1].

Unlike the conclusions of L. Litvinova‑Kulikova et al., whose post‑pandemic study showed that the value of in‑person communication remains decisive for event participants worldwide [24], our work focuses not on format but on methods for assessing the value of such interactions.

A key methodological task is to monetize and integrate into profitability models such non‑financial outcomes as the strengthening of business contacts or increased employee loyalty after incentive tours. Integrated models like the BSC offer one solution by translating strategic objectives (e.g., improving client relationships) into measurable KPIs (e.g., Net Promoter Score or share of repeat contracts). However, as noted earlier, the most comprehensive models (full BSC, Input-Output) face the “Uzbekistan data paradox”: their implementation requires extensive reliable statistics that are often unavailable in an emerging market. Recommending such tools without addressing practical barriers appears unrealistic.

A more constructive solution for Uzbekistan is to develop and pilot a hybrid maturity‑model‑based approach. This envisages a phased transition from simple, accessible metrics to more complex ones as statistical quality and analytical culture improve in organizations.

Stage 1. Extended financial‑operational analysis. At the baseline, Uzbek hotels, tour operators, and congress centers can employ an extended DuPont model [4] for in‑depth factor analysis of profitability, supplementing it with key operating metrics (Occupancy, ADR, RevPAR, GOPPAR), marketing metrics (customer acquisition cost, CPL), and the computational modeling and simulations described by R. Baggio [17] to forecast aggregate effects of large events under different scenarios.

Stage 2. Integration of qualitative and non‑financial data. At the next stage, readily measurable non‑financial indicators – such as customer satisfaction (NPS, online reviews) and employee loyalty – are integrated. The social and image contributions of large events can be captured through expert‑based methods similar to those proposed by Yu. V. Vorontsova and D. S. Garbuz [2].

Stage 3. Transition to adapted comprehensive models. With data accumulation and experience, an adapted, simplified BSC can be implemented, including 2-3 core KPIs for each of the four perspectives most relevant to Uzbekistan’s current MICE development stage (e.g., growth in foreign participants, international media mentions, share of repeat clients).

Such a phased model, combining MCDA [25] with proxy variables and expert judgments, appears the most realistic and practically applicable solution for Uzbekistan.

Conclusions and Recommendations

Isolated use of traditional financial approaches is insufficient for adequate profitability assessment in business tourism and leads to misguided managerial decisions. Effective assessment requires a comprehensive, multi‑level approach combining different model types.

Key conclusions are as follows:

• Traditional financial models are indispensable for evaluating current profitability and financial stability, but they do not capture the long‑term and intangible value created by MICE events.

• Operational and marketing metrics offer important tools for tactical management and optimization of individual business processes, but they do not provide a holistic picture.

• Macroeconomic impact models are critical for strategic positioning of the industry and for justifying public support, yet they are complex to apply and not always accurate at the regional level – especially under limited statistical data.

• Integrated approaches such as the Balanced Scorecard are the most promising, as they link financial results with strategic goals in customer relations, operational efficiency, and innovation.

The contribution of this work lies in systematizing and critically comparing heterogeneous methods, laying the groundwork for a more advanced hybrid toolkit. Its practical significance is in providing an analytical framework for practitioners to consciously select assessment methods aligned with their strategic objectives.

For Uzbekistan, which aspires to become a regional MICE hub, implementing such hybrid models via a phased “maturity” approach will enable not only the attraction but also the objective evaluation of large international events. Starting from accessible financial‑operational metrics and gradually integrating non‑financial indicators and expert assessments, government bodies and the private sector can make more informed investment decisions, ensuring sustainable industry development and enhancing competitiveness in Central Asia.