Quote:
Originally Posted by garcia1000
I agree. Do these things show up in RevPAR or ADR? I think at least in RevPAR right?
RevPAR is a way better benchmark for measuring what a hotel is making. RevPAR=total revenue/capacity (total available rooms) whereas ADR equals total revenue/rooms sold.
RevPAR is the real measurement, as your ADR could be very high but you still didn't make an money. Lets say the hotel had 1000 rooms and they sold 10 rooms for a total of $5k. Wow, your ADR was $500! Sounds good, but the hotel didn't make any money, the RevPAR was only $5 ($5k/1000) and occupancy was only 1%.
Now if, you sold 70 rooms for a total of $7000, your ADR looks shabby at $100(comparitively) but your RevPAR is up to $7 per room, which means the hotel made more money. Not to mention the ancillary revenue generated by filling the rooms.
Comp rooms would only affect RevPAR if the room could have been sold, thus increasing total revenue. If the hotel was running less than 100% occupancay, a comp room would not affect RevPAR as it is a function of total available rooms, which is fixed.
RevPAR, coupled with occupancy, are the most important figures when looking at the "health" of a hotel.