RevPAR -Revenue Per Available Room
Data is incredibly valuable to any hotel or accommodation business. Without it you can’t hope to make accurate, informed, or strategic decisions for the benefit of your property. As time goes by, more and more data is becoming available and the ways to measure and track it are also increasing. This means it’s more vital than ever to use data to analyze and perfect the performance of your business.
RevPAR is a very classic KPI (Key performance indicator) and is regarded as one of the most important financial calculations for any hotel/Airbnb to see how much revenue they have made within a certain period of time.
How do you calculate RevPAR?
RevPAR = Rooms Revenue/Total number of rooms
RevPAR = Average Daily Rate * Occupancy Percentage
It’s important to understand RevPAR and RevPAR Index are not the same thing. While RevPAR is the straightforward calculation to understand how well you are selling and profiting from your rooms, the RevPAR Index measures the performance of your RevPAR relative to a grouping of other hotels, such as a competitive set, market, or sub-market.
The image shows the importance of having higher RevPar vs Occupancy: