Friday, April 29, 2011

Revenue Management Formulas

Few formulas to make life easy.....

1. Potential Average Single Rate

= Single Room Revenues at Rack Rate

Number of Rooms Sold as Singles

2. Potential Average Double Rate

= Double Rooms Revenues at Rack Rate

Number of Rooms Sold as Doubles

3. Occupancy Percentage

= Total Number of Rooms Sold

Actual Number of Rooms

4. Rate Spread

= Potential Average Double Rate – Potential Average Single Rate

5. Potential Average Rate

= (Multiple Occupancy Percentage x Rate Spread) + Potential Average Single Rate

6. Room Rate Achievement Factor

= Actual Average Rate

Potential Average Rate

7. Yield Statistic

= Actual Rooms Revenue

Potential Rooms Revenue

= Room Nights Sold x Actual Average Room Rate

Room Nights Available Potential Average Room rate

= Occupancy Percentage x Achievement Factor

8. Rev Par

= Actual Room Revenue

Number of Available Rooms

= Occupancy Percentage x ADR

9. Equivalent Occupancy

= Current Occupancy Percentage x Rack Rate – Marginal Cost

Rack rate x (1- Discount %) – Marginal Cost

= Current Occupancy Percentage x Current Contribution Margin

New Contribution Margin

10. Required Non-Room Revenue Per Guest

= Required Increase in Net Non- Room Revenue / CMRW

Number of Additional Guests

CMRW = Total Non Room Revenue – Total Room Revenue Center Variable Costs

Total Non- Room Revenue

11. Percentage of No-Shows

= Number of Rooms No-Shows

Number of Room Reservations

12. Percentage of Walk-Ins

= Number of rooms Walk-Ins

Total Number of Rooms Arrivals

13. Percentage of Overstays

= Number of Overstay Rooms

Number of Expected Checkouts

14. Percentage of Understays

= Number of Understays Rooms

Number of Expected Checkouts

15. Forecast Formula

= Total Number of Guest Rooms – (Number of OOO rooms + Number of Rooms Overstays + Number of Room Reservations) + ({Number of Room Reservations x % of No-Shows} + {Number of Rom Understays}) – Number of Room Overstays = Number of Rooms Available for Sale

16. Average Guests Per Room Sold

= Number of Guests

Number of Rooms Sold

17. Average Daily Rate

= Rooms Revenue

Number of Rooms Sold

18. Average Rate Per Guest

= Rooms Revenue

Number of Guests

Wednesday, January 14, 2009

All Professors

Welcome all lecturers, professors and educationalists. I would like to take this opportunity to invite you all to go ahead and post your queries, notes or articles on management into my blog hence making education easy to deliver as well as grasp like a sponge.

Lets make Education Fun !!!