What issue arises when a hotel cannot sell all its rooms on a given night?

The correct response highlights the perishability of services, which is a fundamental concept in the hospitality industry. When a hotel cannot sell all its rooms on a given night, those unsold rooms represent lost revenue that cannot be recovered. Unlike physical goods, which can be stored or sold later, hotel rooms are perishable inventory; once the night is over, the opportunity to sell those rooms is gone. This characteristic emphasizes the importance of effective revenue management and pricing strategies, as hotels need to maximize their occupancy rates to ensure profitability within that given time frame.

The perishability of services impacts decision-making in hospitality, necessitating dynamic pricing, promotions, and advanced booking strategies to encourage sales during low-demand periods. This concept aligns with the necessity for hotels to optimize their operational capacity continuously, ensuring they minimize the effects of unsold inventory.