Purpose: The aim of this study is to examine the impact of service strategy rural tourism on tourism business development in Panyatan Waterfall in Purbalingga, Central Java, Indonesia Theoretical framework: Previous study showed that service strategy has positive impact on tourism business development, especially in fomous and well-managed tourism site. However, there is still much to investigate if the situation is occurred in rural destination that not categorized tourism site, like Panyatan Waterfall.
Design/methodology/approach: This research is a primary research type. The authors conducted field research on April-June 2022 to interview and distribute questionnaire to visistors. There are 543 visitors who respond and answer our questionnaire. The respondents were selected using an accidental sampling technique with the Lemeshow formula. The data were analyzed using validity, reliability, and descriptive analyses, as well as simple linear regression.
Findings: The results showed that service strategy in rural tourism has significant effect to tourism business development in this area.
Research, Practical & Social implications: The study revealed that service strategy that conducted by local people surrounding tourist site in Panyatan Waterfall lead positively impact to the economy of community in Panyatan Waterfall.
Originality/value: The result of study indicated that the friendliness of the resident surrounding the tourist site become part of the external service of community, and it attract tourists to visit Panyatan Waterfall.