In recent years new “PAR” indicators have appeared in order to assist hoteliers in making better revenue management decisions. However, the more indicators come up, the harder it is to focus on the right one. The question is…..do we really need to use them all?
Let’s recap the most important ones:
RevPAR: Is considered to be the key indicator of Revenue Management.
Instead of focusing only on occupation and / or average rate, this indicator gives a combination of both.
However, sometimes the RevPAR does not go far enough to measure the revenue effectively, as it does not include revenues from other areas, nor does it measure distribution costs.
Goppar: Is the indicator that financial people like most because it includes both total income and total cost.
a) Reflects all income. Revenue managers in the future will have to leverage other income (groups, packages, F&B etc.).
b) Shows all expenses. Depending on which distribution channel we are using, distribution cost varies.
However, GOPPAR as a key indicator for the revenue manager can sometimes be misleading. For example, mismanagement of expenditures in other departments also affects this indicator.
TrevPar: Total Revenue per Available Room – the indicator of the totals. With TrevPar we go beyond rooms management and include all departments in our efforts to maximize revenues. Unfortunately, current PMS systems greatly limit its implementation, because the data is just not available. Any PMS out there that would allow us to get data on total revenue of each month for each segment ??
In the next 5 years, in your opinion what will be the most important indicator in Revenue Management?
Click here to participate in our online survey