1. What is Average Daily Rate (ADR)?

Average Daily Rate (ADR) is a key performance metric in the hotel industry that measures the average revenue earned per occupied room per day. It provides insight into the pricing strategy and revenue management effectiveness of a hotel property.

2. How Does the Calculator Work?

The calculator uses the ADR formula:

Where:

• \( \text{Total Revenue} \) — Total room revenue for the period (currency)
• \( \text{Number of Rooms Sold} \) — Total number of rooms sold during the period (count)

Explanation: ADR calculates the average rate at which rooms are sold, excluding complimentary rooms and rooms not sold.

3. Importance of ADR Calculation

Details: ADR is crucial for hotel revenue management as it helps in evaluating pricing strategies, comparing performance against competitors, and making informed decisions about rate adjustments and occupancy targets.

4. Using the Calculator

Tips: Enter total room revenue in your local currency and the total number of rooms sold during the specified period. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is a good ADR for hotels?
A: A good ADR varies by hotel type, location, and season. Luxury hotels typically have higher ADRs than budget hotels. Compare against competitors and historical performance.

Q2: How does ADR differ from RevPAR?
A: ADR measures average room rate, while RevPAR (Revenue Per Available Room) considers both rate and occupancy, calculated as ADR × Occupancy Rate.

Q3: Should taxes and fees be included in ADR calculation?
A: ADR typically includes room revenue before taxes and fees, but consistency in calculation method is most important for accurate comparisons.

Q4: How often should ADR be calculated?
A: Most hotels calculate ADR daily, weekly, and monthly to track performance trends and make timely pricing decisions.

Q5: What factors can affect ADR?
A: Seasonality, day of week, local events, competition, booking channels, and length of stay can all significantly impact ADR.