Measuring hotel performance is an extremely important part of the revenue management process. For years, one of the key hotel performance indicators has been RevPAR, or Revenue Per Available Room. But should you now be taking other KPIs into consideration?
RevPAR represents the revenue generated per available room, whether or not the rooms are occupied. RevPAR helps hotels measure their revenue-generating performance to accurately price rooms. Since it’s such a widely used metric, RevPAR can help hotels measure themselves against other properties or brands through benchmarking services.
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The main issue with GOPPAR is that what is and isn’t included in the calculation of Gross Operating Profit is still fairly new.
Another issue with GOPPAR is comparing hotels with Food & Beverage to hotels without. Since the F&B profit percentage is different from that generated from guest rooms, the calculated percentages will likely differ between limited and full-service offerings. Therefore, it is important to compare similar hotel products when possible.
Whatever metrics you use, be sure to take a holistic view of your revenue management, work closely with other departments, and build a strategy based on driving total profitability based on total guest value.
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