The hotel numbers every owner should know.
Plain-English definitions of the metrics in your P&L, your STR report and your management agreement, from an operator-led advisory firm.
ADR Average daily rate
Room revenue divided by rooms sold. The average price paid per occupied room. Compare it with your comp set, not only with last year.
Occupancy Occupancy rate
Rooms sold divided by rooms available, as a percentage. Always read it alongside ADR: high occupancy at a weak rate can still lose money.
RevPAR Revenue per available room
Room revenue divided by rooms available, or occupancy multiplied by ADR. The standard single measure of rooms performance.
TRevPAR Total revenue per available room
Total hotel revenue, including food and beverage, parking and other income, divided by rooms available.
GOPPAR Gross operating profit per available room
Gross operating profit divided by rooms available. Shows how much profit each room generates, not just revenue.
GOP Gross operating profit
Revenue minus departmental and undistributed operating expenses, before management fees, fixed charges and debt. The truest read on how well a property is run.
Flow-through
The share of a change in revenue that reaches profit. If revenue rises $100,000 and GOP rises $45,000, flow-through is 45%.
CPOR Cost per occupied room
Rooms-department cost divided by rooms sold. It exposes housekeeping scheduling problems that percentages can hide.
MPI Market penetration index
Your occupancy divided by your comp set’s occupancy, times 100. Above 100 means you are taking more than your fair share of demand.
ARI Average rate index
Your ADR divided by your comp set’s ADR, times 100. Below 100 means you are pricing under the market.
RGI Revenue generation index
Your RevPAR divided by your comp set’s RevPAR, times 100. Also called the RevPAR index; the headline STR measure of market share. Try the RevPAR index calculator.
STR report
A benchmarking report comparing a hotel’s occupancy, ADR and RevPAR with a chosen competitive set. Widely used across the US hotel industry.
Comp set Competitive set
The group of nearby hotels a property benchmarks itself against. Choosing the right comp set is what makes index numbers meaningful.
USALI Uniform System of Accounts for the Lodging Industry
The standard chart of accounts and P&L format for hotels, so results can be compared across properties and brands.
Labor cost percentage Labor cost as a percentage of revenue
Total payroll, taxes and benefits divided by revenue. Usually the largest controllable expense in a hotel.
Base management fee
The fee a third-party management company charges, typically a percentage of total revenue, paid whether or not the hotel is profitable.
Incentive management fee
An additional fee paid to a management company when profit exceeds a defined threshold. How “profit” is defined matters as much as the rate.
FF&E reserve Furniture, fixtures and equipment reserve
Money set aside, often a percentage of revenue, to replace furniture, fixtures and equipment over time.
PIP Property improvement plan
The list of upgrades a brand requires, typically at a change of ownership, a conversion or a franchise renewal.
Pre-opening Pre-opening period
The months before a new hotel opens: hiring, training, systems setup and sales, with costs tracked in a separate pre-opening budget.
Want these numbers on one page for your property every month? Every Big Tex plan includes a custom oversight dashboard, and the owner scorecard lists the twelve to review first.
Your first 30 days are included.
One setup fee covers onboarding and your first month of oversight. The monthly fee starts on day 31. Month to month, cancel with 30 days’ notice.