Measure your hotel's revenue efficiency by calculating the Average Daily Rate (ADR), a critical KPI for hospitality performance analysis.
The Average Daily Rate is calculated by dividing the total revenue generated from rooms by the number of rooms actually sold.
ADR = Total Room Revenue / Number of Rooms Sold
Example 1 (Boutique Hotel):
Example 2 (Large Resort):
In the competitive world of hospitality, data-driven decision-making is the bedrock of profitability. The Average Daily Rate Calculator is an essential tool designed for hoteliers, revenue managers, and property owners to assess the financial performance of their room inventory. Average Daily Rate (ADR) represents the average rental income per paid occupied room during a specific time period. Unlike total revenue, which gives a broad financial picture, ADR zooms in on the pricing power of your property.
Understanding your ADR is critical because it isolates price from volume. For example, two hotels might have the same total revenue, but one might achieve it by selling many rooms at a low price (low ADR, high occupancy), while the other sells fewer rooms at a high price (high ADR, lower occupancy). Using the Average Daily Rate Calculator helps you identify which strategy you are currently employing and whether it aligns with your brand goals. It is important to note that ADR does not account for unsold rooms or the costs associated with servicing the rooms; for a complete picture, it is often used alongside other metrics like RevPAR (Revenue Per Available Room).
To use the Average Daily Rate Calculator effectively, you must ensure your data inputs are clean. "Total Room Revenue" should strictly exclude taxes, resort fees, and ancillary revenue streams like food and beverage. Similarly, "Number of Rooms Sold" should generally exclude complimentary rooms (Comps) or "House Use" rooms, as these would artificially lower your rate calculation. According to industry standards set by organizations like STR (Smith Travel Research), consistent methodology is key when comparing your performance against market indices.
This calculator is not just for hotels; it is equally valuable for vacation rentals (AirBnB/VRBO hosts), bed and breakfasts, and hostels. By tracking this metric over time, you can spot trends—such as the effectiveness of seasonal promotions or the impact of local economic shifts. For a broader understanding of hotel performance metrics, resources like Investopedia offer in-depth financial definitions. Our Average Daily Rate Calculator simplifies this financial analysis, giving you instant access to the numbers that drive your revenue strategy.
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ADR (Average Daily Rate) measures the average price paid per occupied room. RevPAR (Revenue Per Available Room) measures revenue across all available rooms, regardless of whether they were sold. RevPAR effectively combines occupancy and ADR into a single metric for overall property health.
No. Standard industry practice is to calculate ADR using net room revenue. Taxes, resort fees, and service charges are pass-through costs or separate line items and should be excluded to get an accurate measure of your rental income.
Not necessarily. If you raise your rates too high (increasing ADR), your occupancy might drop significantly, leading to lower total revenue. The goal of revenue management is to find the "sweet spot" that maximizes RevPAR, not just ADR.
Most hotels calculate ADR daily to track immediate performance. However, it is also analyzed on a weekly, monthly, and yearly basis to identify long-term trends and seasonality patterns.