The 8 key performance indicators of a hotel


These are also often called “performance indicators”. However, some of the more complex aspects of these indicators may remain unclear.

Although your hotel management software remains a vital ally when it comes to collecting information for data calculations, it is also useful to be aware of how these calculations are carried out in order to use the results to make adequate decisions and to efficiently analyze a given situation. Here are the eight key metric indicators that a competent hotel manager should know.


Your hotel’s occupancy represents the percentage of occupied rooms relative to the number of rooms available in your hotel. Thus, if your hotel has 100 rooms and 65 of them are occupied, then your occupancy is 65%. This data is particularly relevant, as it allows you to precisely analyze your hotel’s current situation and to see which elements are attracting clients to book at any given time.
This idea can also be useful to you in terms of your hotel organization. It can provide you with some forecast data in many different departments. When you reach high occupancy, it is important that each service you provide meets your clients’ expectations. Occupancy has a significant influence on your human resource needs. It is thus essential to have a wide panorama of your occupancy in order to ensure that in periods of high occupancy, each department has enough employees to maintain a standard level of services.
By knowing how to compute your occupancy rate, you can access and utilize an analytic element in relation to your hotel’s profitability. Your occupancy can vary depending on a number of different factors, such as your room rates. For example, if your rates are low, you might have a high occupancy, but this does not necessarily equal optimal profitability. In other circumstances, your occupancy alone can be of very small significance when indicating your performance. For example, if you have a high occupancy, you will probably need to hire more staff, for housekeeping amongst others, which will inevitably have a negative impact on your profitability.


ADR (average daily rate) is your rooms’ average daily rate. It is computed by adding the rates of all your occupied rooms, and then dividing this sum by the number of occupied rooms. This indicator is interesting to look at, especially in order to compare your current average daily rate to that of the previous year. You can also analyze the impact of your mean ADR on your occupancy.
The ADR will provide you with some ideas and possibilities concerning your occupancy. It is obvious that the more you want a high ADR, the bigger the challenge for high occupancy will be and vice versa. It is by your pricing policy that you can find the right equilibrium between ADR and occupancy in order to maximize your income. Thus, the question becomes: Could I have had a better ADR with the same occupancy?
If you are able to offer some discounts, your ADR will be directly affected, as discounts often influence room rates. This is why it is essential to be aware of each discount and event happening at your hotel. With this knowledge you will be not be surprised by a considerable ADR gap between the current and previous year.


The REVPAC metric indicator (revenue per available customer) represents the total revenue generated by a single customer. The REVPAC is computed by taking the total revenue generated by all the customers and then dividing that sum by the total number of customers staying at your hotel. This computation yields the average revenue per hotel guest. This is useful when it comes to making predictions according to your occupancy and time of year. The REVPAC is often an easily improved element as it acts on clients that are already staying at your hotel. A small number of actions can be taken in order for to generate additional revenue. Why not offer a superior room (upsell) upon your client’s arrival for a small additional fee? Offering a superior room can have a wide variety of outcomes. First, your client will be pleased as they will believe they benefited from an advantageous rate. Then, the standard and vacant room will be available for another client who may want to book the room at a lower price.
Improving your REVPAC is an overall goal that can be taken into consideration by all the different departments in your hotel. You might want to include other hotel amenities, for example, bringing a bottle of wine from the hotel bar to the room (crossell), or other options, when you give your clients the opportunity to enjoy the experiences offered by your hotel. The front desk plays a key role given that it will present to your clients all the different available offerings, such as early check-in or late check-out.
If you fail to improve your REVPAC, you need to keep in mind that you can still act on a number of factors in your hotel, and that, sometimes, you just need to remind your staff of the numerous different sales opportunities your hotel offers.


The REVPAR (revenue per available room) is another key performance indicators. This means that a particular room can be rented during the observed period of time. This metric indicator is computed by multiplying the ADR by occupancy. It is used to determine the average rate displayed for the available rooms. Let’s take an example over a month: If, during one month, you rented your rooms at an average rate of $100 and your monthly occupancy was 75%, then your revenue per available room was $75. With this analysis, you can then adjust your rates and lower them to $75 in order to reach a 100% occupancy. On the other hand, if you realized that you had not reached your budgetary equilibrium point during the month, the solution would not necessarily be to lower your rates, but rather to find out which department had not been profitable. If it was that your housekeeping department hadn’t cut down on its expenses despite an occupancy of 75%, your loss of profitability could have possibly come from this department.


The GOPPAR is perhaps the trickiest indicator to compute. It represents the gross profit per room. This metric indicator reflects the performance of the different departments of your hotel. It takes into account the overall profits generated by your hotel, including food and drink related sales. This amount is then divided by the number of rooms in your hotel to yield your GOPPAR. It allows you to have a clear view of your average profits generated when you rent a room. Thus, the closer to your mean ADR that your GOPPAR is, the less performant your departments will be, and vice versa.
The GOPPAR is a profit indicator as its computing is solely based on them. This means that it relies on the revenue minus the costs associated to generate that revenue. However the yielded result cannot precisely point out where the performance was better or worse. It is only an overall daily indicator.

Customer acquisition cost

Customer acquisition cost is a metric indicator which represents the cost invested for each “acquired” customer, meaning, for each additional client who books at your hotel. The customer acquisition cost can be computed by summing the total amounts invested in sales and marketing, and then dividing that sum by the number of new clients acquired by the investment made in these departments. In order to make a profit on the invested costs, you can establish loyalty programs for your new clients, and, at the same time, improve your retention rate. For this to happen, you need to rely on customer experience, maintain a good level of satisfaction and try to target a clientele that is likely to become loyal, like the business clientele for example.
That way, you can compute the average amount of money you need to invest in order to attract new clients and entice them to book at your hotel. Depending on your loyal clients and your goals concerning new clients, these computations can give you a clear idea as to the degree of investment needed for the future.


The ROI corresponds to the profitability efficiency of an investment. It represents the percentage of revenue you collect on the overall original investment. For example, if you invest $100 in a project, and, if after a year this project has generated $120, you will have made a total of $20 profit and thus a 20% return on investment. The ROI is a significant indicator to analyze in order to evaluate whether the amounts you invest in your hotel are worth it or not.

Retention rate

In the hospitality industry, the retention rate represents the proportion of clients that remain loyal from time to time. Often, we consider a period of time of a year when analyzing the retention rate as it highly unlikely that a client would stay at your hotel every month. By being aware of the retention rate, you are able to adjust your strategy when it comes to retaining clients, and at the same time, improve their overall level of satisfaction.
The retention rate can also be used when analyzing what your clients have consumed during their stay at your hotel. You can look at which proportion of your clients dined at your restaurant, which proportion took a spa package, which proportion took part in activities, etc. You can then compute your retention rate by an expenditure source and thus improve your REVPAC.
With all these metric indicators within your reach, you can analyze your performance in a precise and efficient manner. However, it is important to keep in mind that these indicators must be used in a defined framed context and often combined with other indicators. When they are well analyzed, these eight key indicators will precisely represent your hotel’s performance to keep you competitive and help you achieve your hotel’s full potential.


How to survive the holidays?


If your hotel is open during the winter, the holidays might be your busiest time of year and require sophisticated management. It is also possible that you experience low occupancy rate if the Winter is a rather quiet period of the year for your hotel. In order for you to manage this holiday season confidentially and efficiently, no matter what your situation is, we have gathered you a little practical guide.


Manage your conference rooms efficiently

The holiday season is an ideal time for family or corporate gatherings where groups of clients will look for rooms to book and host events. If your hotel has conference or reception rooms, it is wise for your PMS software to be equipped with a room management software to ensure an efficient event management for the holidays.

With a good room management software integrated into your hotel’s PMS software, all the information is centralized, which makes coordination and the exchange of data quick and efficient. The software prevents you from making mistakes and losing important information when planning these events. If you usually experience peak occupancy during the holidays, you do not want to mix up bookings or misjudge the amount of food you need for a particular group. This is why it is crucial for you to be well organized and a PMS software equipped with a room management module is your best ally when it comes to planning events during the holiday season.

Use a yield management module

With high occupancy during the holiday season, it is important to be take advantage of a yield management module. This module allows you to fluctuate your rates in order to maximize your occupancy and your income. During this time of year, you can raise your rates because of the increase in demand for your rooms. It is therefore important to have a high-performance PMS software equipped with a yield management module to carry out these computations according to the right criteria.

Do not worry if your hotel does not reach its full capacity

Most clients, in anticipation of the holiday season, prefer to book in advance to guarantee a room. Other clients, however, show up without having booked. During this time of year, clients are more likely to book a room at the last minute. Therefore, if you still have some rooms available, you need to use a good strategy to attract those undecided clients who will book at the last minute.

Some clients might choose to book a room at the last minute seeing how they are far from home during Christmas dinner. Additionally, for hotels located in snowy regions during the winter, clients might be inclined to book a room late at night when they cannot go home due to unfavourable weather conditions. So do not panic if your hotel seems quiet at the beginning of the day, as some clients may arrive later without a booking.

In order to accommodate these late clients, make sure you have enough rooms heated and clean, ready to welcome clients for the evening. Especially if you are a small hotel or a regional motel, it is likely clients will come to you first before seeking accommodation in the nearest bigger town. It is therefore wise to keep a few rooms ready for these clients who will require a heated room to sleep in on Christmas Eve, even if the rest of your hotel has not reached its full capacity.

Establish a multi-step sales strategy

Even if the holiday season only stretches across a few number of days, the business opportunities can stretch over a longer period of time. This results in sales opportunities for a couple of months.It is not rare during the summer for some corporate or private groups to start thinking about hotel availabilities and room openings for upcoming events. The holidays attract a wide variety of clients at the same time so if a group would like to be certain of having a room for a precise date, they need to book in advance. Additionally, if some groups are able to anticipate and book months in advance, some are not. You need to stimulate those forgetful groups by different marketing actions that can be put in place during the summer. It can be very beneficial for you to remind them that they should consider booking soon if they want to be given priority the holidays come.

It is important to frequently update your room availability to remind your clients about holiday season offerings and packages. This creates a sense of urgency which activates the booking process for those interested by your offers. For the clientele whom do not belong to any particular group, the earlier you can provide information about your holiday offers to your booking agents, the easier it will be for them. This will allow your booking agents to answer any questions the clients may have and provide them with all the necessary information they require to book. More often than not, having precise information when your clients asks for specific details will give you a competitive advantage. Indeed, your competition might not have launched their holiday offers as early as you.

Once the holiday season is over, you still have some business opportunities. Some groups who were unable to book for their chosen dates will want to book as soon as the holiday season is over. The period following the holiday season is usually an off-season time of the year characterized by a low occupancy for some hotels. It is thus the perfect time to take the opportunity to offer these groups the possibility of booking for the following year the room they had in mind. However January can still be a month full of celebration so these groups could also choose to come and celebrate after the traditional holiday season ends. This is a good way of filling rooms in January, a month that can be particularly quiet. You can also perhaps offer them an advantageous discount as they are occupying rooms during an off-season time of year.

Prepare your PMS for the holidays

Even though the holiday season comes by every year and you think you are used to it, some work needs to be done in preparation for this peak occupancy season. This is to ensure everything goes smoothly and in the best manner possible. First, it is important to have a good overview of the previous years’ performance in order to establish an efficient strategy. This overview, which you can see on your PMS software, is a basis on which you can build your strategy for the holidays. Secondly, creating packages in your PMS software is the essential element which will allow your booking agents to rapidly inform clients who are calling them and start taking bookings with these complete packages.

Once all the packages are entered in your PMS software you need to ensure that they show up on your booking engine so that clients wishing to book online can do so. In order to avoid losing time, a booking engine that can intake the packages entered into your PMS software is crucial. Do not forget to take notes on your PMS software of all the planned activities in your hotel so that you can provide as much information as possible to your potential clients.

With all these tricks and ideas for the holidays, you are more than ready to get through the winter with confidence and efficiency.

How to increase your property’s occupation rate?


Understanding occupancy rate

The occupancy rate is used to determine over a given period the proportion of your rooms that are rented compared to the total number of rooms available. This rate can be calculated by day, month, week or another frequency and will vary according to the period under consideration. The higher your occupancy rate, the more your rooms are booked, and the busier your hotel is. Your occupancy rate may be lower at certain times. This situation happens at every hotel, even if you’re looking to have the highest possible occupancy rate as often as possible. Factors that will affect your occupancy rate include the season, weather, less favourable political or economic conditions or even a poorly positioned offer.

While your average occupancy rate may be close to 100% on Saturdays, on Wednesdays, it may hover at 30%. By studying your occupancy rate trends, you can learn a great deal about your establishment and implement targeted actions to increase your occupancy rate when needed, whether it’s for days of the week that aren’t as busy or for times of the year when business is slower. You must identify when dips in occupation occur and the reasons for them. Conversely, you also need to pinpoint the factors that boosted your occupancy rate for a given period. By doing this, you can repeat what you have done to increase your occupancy rate at other times when occupancy isn’t at its peak.

Things that impact occupancy rate

Occupancy rate will vary depending on your hotel’s type and location. For example, it stands to reason that the occupancy rate at a hotel located on a ski mountain will be much higher in winter than in summer. Conversely, if a hotel is located on the beach, it will be busier during the summer. Many other factors can affect your occupancy rate, including room rates, the guest experience, your online reputation, room cleanliness and the quality and availability of your facilities. That being said, without a doubt, a hotel located on famous ski mountain won’t need to exert a great deal of effort during the winter period. However, during the summer season, this hotel can attract as many guests if the surrounding attractions are just as active.

How to increase your occupancy rate

Define your target market

To increase your occupancy rate, you must define your target market. If you don’t target the clientele that best matches your hotel, you risk missing out on many potential guests. To define your target market, analyze the data your hotel management software has collected. If you analyze this data deeply, you’ll discover your clientele’s demographics, type and geographical origin. With this data in hand, you can determine which market to target to focus on by implementing marketing initiatives that will attract more guests from this segment.

Create customized packages and promotions

One of the initiatives you can implement to attract guests from your target market segment is to create packages and promotions that are likely to appeal to this clientele. Guests’ expectations vary according to certain factors, including income, age, cultural background, nationality and occupation. You must consider these factors to create packages and promotions your target clientele won’t be able to refuse.

Make the most of events

When creating packages and promotions for your target clientele, be sure to make the most of events being held near your hotel. This approach is sure to increase your occupancy rate. Cultural festivals, big conferences, concerts or other similar activities are golden opportunities to attract guests to your hotel. You can take advantage of these events in several ways. First, you can create an event-related package by including event tickets in the booking price, for example. You can also offer a special discount to people who show you their tickets for the event. Naturally, the best approach is pairing up with the event organizers so that they include a link to your hotel on the event website or their flyers. Remember, by promoting an event, you’re promoting your hotel. Even though these events may last only a few days, they can draw attention to your hotel and increase your occupancy rate. Moreover, if these events are recurring, they can attract a recurring clientele as well!

Offer tempting loyalty programs

Nothing works better than an advantageous loyalty program to guarantee a recurring guest base. Why would a guest come back to your hotel when they have so many other options? Of course, if they enjoyed their experience, they may be tempted to return, but they may also be looking around for new experiences. That’s where loyalty programs come into the picture. When such a program offers rewards that are attractive to guests, you ensure they’ll return to your hotel to make the most of them. Consider offering guests free nights after a certain number of stays or points accumulated, discounts, gratuities or any other reward that is likely to attract them to return to your hotel.

Ensure your hotel is accessible

Despite all the efforts you roll out to increase your occupancy rate, keep in mind that many elements can still deter potential guest from staying with you. You must consider these elements to make your hotel as inclusive as possible. First, make sure your facility is wheelchair accessible. Disabled people and the elderly may eliminate your hotel quickly from consideration if they feel it isn’t suitable for them. For families travelling with small children, make sure high chairs are available at your restaurant and cradles for the rooms. Have many people asked you whether your hotel accepts animals? It may be worthwhile to give it some thought. As these establishments are rare, accepting guests with animals would give you access to a new type of clientele. Depending on the size of your hotel, it could also be interesting to give your guests the opportunity to organize events such as weddings, corporate meetings or family gatherings. Based on your target clientele, all these elements should be kept in mind because they could all broaden your horizons and contribute to increasing your occupancy rate.

6 Qualities of a Good PMS

Les 6 qualités d’un bons PMS hôtel

A good PMS must:

Be easy to use

Your PMS must be easy to use. Guests shouldn’t be left waiting because the receptionist can’t find an option in your hotel management software. It’s important to remember that the easier your software is to use, the faster you can act and the more satisfied your guest will be. Your PMS should be intuitive and efficient so that you don’t waste time, satisfaction and money.


Not only must your PMS meet your hotel’s current needs, but it should also scale to your needs. To this end, it should offer many module options, features and integrations that can be added in the future if your needs evolve. Your PMS should also allow you to follow trends and connect with new partners who offer complementary tools. A good PMS is regularly updated with new features and improvements designed to help hoteliers on a daily basis and improve the guest experience.

Be available on the Cloud

With a Cloud-hosted PMS, you’re no longer physically tied to your computer. You can access your hotel management software from any Internet-connected device. Moreover, your provider can automatically update to your Cloud PMS as well as handle hardware, storage, networking and software maintenance. By choosing the Cloud, you no longer need an in-house technical infrastructure or to maintain and pay staff to respond to potential server issues. Your PMS provider covers all these costs.

Include excellent technical support

A good PMS includes excellent built-in customer service. No matter the type of question you may have about your PMS, you must be able to call your software provider and get answers or training as quickly as possible.

Be automated

Your PMS must assist you in your work. By choosing a PMS that automatically performs recurring tasks for you, you can focus better on other more relevant tasks and optimize your time. For example, choose a PMS that automates night audits, room assignments and guest e-mailings.

Provide quantitative data

Because a good PMS provides access to a wealth of statistics, reports and forecasts to help you make informed decisions and optimize your management tasks, it can have a positive impact on your revenue. To properly manage your business, you must have direct access to your key indicators, such as ADR, REVPAC, REVPAR, CAPC and even your occupancy rate. A PMS that doesn’t make it easy to view this information doesn’t belong in a hotel looking to progress and evolve.

Why is it beneficial for hoteliers to train their staff?


1 – Boost their performance

Investing in training isn’t done simply for the employee’s benefit — it can greatly improve their efficiency too. Employees with extensive knowledge of their work tools tend to outperform others since they can maximize the full potential of the Property Management Software (PMS).

Online training offers your staff the opportunity to learn from real experts. It also frees up the time of your own trainers, whose role as a trainer is often improvised, so they can focus on their real duties.

2 – Improve service

Employees who have a good grasp of their hotel management software can concentrate on the other tasks that need to get done. So, instead of wasting time trying to understand how the PMS works, they’ll use the automated features.

3 – Share responsibilities

When trained to address any type of situation, employees can work autonomously at peak times, which can translate into taking on more responsibilities. Managers can therefore focus on their main role, which is to supervise overall activities. Better trained staff will also be more motivated because they’ll be in control of their work tasks.

4 – Give to get something back

Training your staff is an expense. However, the average return on investment is between 7% and 49%, which represents significant gains. In all cases, the amount invested will be recouped and may increase by up to 50%.

In the hotel industry, the impact can be even greater for front desk clerks or reservationists. Refusing a sale, quoting the wrong rate and giving poor customer service all cause revenue loss. Training therefore plays an important role in ensuring stable revenues for an establishment.

4 ways to keep your hospitality staff happy


1 – Establish a working culture of learning and development

The nature of the hospitality industry is that employees may see their job position as short term. Invest in developing these positions into long-term careers for employees. These opportunities can include advanced education or training programs focusing on customer service, best practices, management skills and cultural training, recommends Hospitality Magazine.

Le mentorat, le coaching, ainsi que les conférences et les ateliers sur l’hôtellerie peuvent notamment aider les employés à développer leurs compétences et à faire progresser leur carrière. Voyez les désirs et les besoins de vos employés comme une priorité absolue. En investissant dans leur carrière au moyen de l’apprentissage continue, ils investiront dans votre entreprise en retour. En effet, il est prouvé qu’un personnel heureux au travail engendrerait une hausse de la productivité, une meilleure conservation des employés, un environnement de travail plus harmonieux, une meilleure relation de confiance avec vos clients mais aussi avec vos employés

Providing mentorship, coaching, guest speakers, and sending employees to hospitality conferences or workshops can help them further develop their skill sets and advance their job into a career. Address the wants and needs of your employees as a top priority. Investing in the careers of your employees through ongoing learning opportunities will motivate them to invest in your company in return. Indeed, it’s proven that a happy staff would generate an increase in productivity, employees retention, a harmonious work environment, and a better trust relationship with your customers and employees.

2 – Recognize and reward staff for performance

In order to keep motivation high, acknowledge staff members for great performance. A sense of accomplishment can motivate employees to maintain good work ethics and strive to be better. Follow up on recognition and efforts by offering a training program opportunity. Opportunities for promotions can also create positive energy, improve staff-to-customer engagement and promote a driven, hard-working environment but do not forget that promotion is not the only criterion for employees happiness. For underperforming staff, take the time to address their weakness, value and potential. Listen and help them set realistic goals to improve their performance and make a greater impact on the company.

3 – Develop an environment of accountability

Support and a high level of accountability are the backbone of a successful work environment—but remember, it shouldn’t be forced compliance. Meeting team expectations can boost an employee’s motivation and drive to perform well, since their work affects others and poor work lets others down. Even freedom can create a sense of employee ownership. Allow employees to practice independent decision-making skills and offer solutions. Employees may thrive off the additional responsibility, which builds workplace confidence.

4 – Communicate the company’s vision

An engaged employee understands and is a part of the company’s vision, suggests Horizon Hospitality Associates, Inc. Involvement in the greater picture helps employees feel like they serve a purpose beyond just their everyday tasks and responsibilities. Let them know that they play a role in achieving overall business goals and that they contribute to successes.

Companies can communicate these messages through department meetings, one-on-one evaluations and even incentives with messages from management. For example, thank employees with a gift card or lunch outing while mentioning that their efforts impact a certain department goal or the company’s mission.

Your employee’s environment must enable their development and the recognition of their efforts, as well as being rewarding. This way you’ll be able to keep your staff happy and motivated, thus increasing their productivity and their efficacy.

5 tips to make your hotel staff more productive


Give incentives to work harder

One of the first things you can do to encourage your hotel team to work harder is to give them incentives. This can be anything from bonuses for good work, more time off, an employee award, or something similar that recognizes the hard work they’ve been contributing to the operation of your hotel.

People like being rewarded for doing great work. You’ll find that the more you reward great work, the more productive your hotel staff will be. This is extremely beneficial during the peak season.

Encourage breaks

You need your staff to be efficient, productive and ‘on-fire’ when it comes to operating your hotel and looking after guests. However, with this high workload, it’s also important to encourage breaks to help reduce the risk of an employee having a burnout. If this occurs, your hotel will suffer because key staff members will need more time off to recover from the extra work.

Instead, encourage time off and make sure you have adequate staff who can fill in. You’ll find that your staff will become more efficient and productive if they aren’t tired or pushed to their limits. So encourage employees to take some time off when they’re getting overworked or stressed out.

Make them accountable for their actions

If your hotel staff doesn’t do a job properly, it’s important that they’re held accountable for it. There should be consequences to their actions. Consequences will make them work harder to avoid these mistakes or inefficiencies in the future. After making them accountable for their actions, you’ll find that their productivity will increase greatly.

Stop micromanaging

Sometimes micromanaging won’t motivate your staff members. Micromanaging gives them the impression that you don’t trust them to run your hotel. Instead, try to step back a little and give them more responsibility.

Show them that you trust them to get the job done right the first time. If they don’t, make them accountable. Over time, you’ll find that by giving them more responsibility, their efficiency and productivity levels will increase because they’ve become more confident in themselves and in how they operate their area of your business.

The uplift towards happiness

Concerns and imperfect actions are catalysts that provide us with key indicators on what to do next. Ideally, we want to be as proactive as possible so that concerns don’t happen in the first place. But we live in an imperfect world. Don’t take for granted the impact your employees will have on your hotel brand.

Identify new and creative ways to embrace happiness for your hotel team. Happy employees will have a positive impact on your hotel’s productivity.

Exploiter un hôtel est exigeant et très stressant. Si vous pensez que votre personnel n’est pas aussi productif qu’il le devrait, pourquoi ne pas changer les choses un peu et essayer quelques-uns des conseils ci-dessus? Vous pourriez être surpris de voir à quel point vos employés peuvent devenir plus productifs simplement à la suite de petits changements.