How are you measuring your hotel room revenue performance?

It is somehow traditional to associate hotel performance with Occupancy Rate. On the price side, Average Rate (AVG Rate) is a key index for the sold rooms. Both Occupancy and AVG Rate as stand alone indexes, offer only partial aiming view towards the profits maximisation objective.

Maximising AVG Rate may “empty” the hotel. Maximising Occupancy -at a low price- may “fill” the hotel and diminish profitability. Rooms revenue related to the total available for sale rooms (REVPAR, Revenue Per Available Room) is a rate that best fits the profit maximisation requirements.