How to Calculate Average Daily Rate (ADR) Per Month in Hospitality

Learn how to calculate the Average Daily Rate (ADR) per month effectively for your hospitality business.

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Calculate the Average Daily Rate (ADR) per month by dividing the total revenue by the number of occupied rooms. Formula: ADR = Total Revenue ÷ Number of Occupied Rooms. Example: If total revenue for a month is $100,000 and 500 rooms were occupied, the ADR is $100,000 ÷ 500 = $200. This metric helps measure the performance of accommodations and informs pricing strategies.

FAQs & Answers

  1. What is Average Daily Rate (ADR)? Average Daily Rate (ADR) measures the average revenue earned per occupied room in a given time frame.
  2. Why is calculating ADR important? Calculating ADR helps hotels assess performance, optimize pricing strategies, and maximize revenue.
  3. How can I improve my hotel's ADR? You can improve ADR by optimizing room rates, enhancing guest experiences, and implementing effective marketing strategies.
  4. What factors influence Average Daily Rate? Factors include location, seasonality, market demand, and the quality of accommodations offered.

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