[Infographic] Why RevPAR Doesn’t Tell a Hotel’s Full Story

Revenue per available room (RevPAR) has long been the hotel industry's key benchmarking metric. Its success as a key performance indicator (KPI) is primarily the result of how easy it is to gather the information, calculate and understand results.

RevPAR combines the results of both occupancy and average rate into one number. Calculating RevPAR is easy, because all you need is occupancy and average daily rate:

RevPAR = Occupancy * ADR

However, its simplicity and comprehensibility conceal its shortcomings.

Here we illustrate why RevPAR doesn't tell a hotel's full story.

— Source: HotStats Limited

About HotStats

HotStats provides monthly P&L benchmarking and market insight for the global hotel industry, collecting monthly detailed financial data from more than 8,500 hotels worldwide and over 100 different brands and independent hotels. HotStats provides more than 550 different KPIs covering all operating revenues, payroll, expenses, cost of sales and departmental and total hotel profitability.

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