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:

• \( ADR \) — Average Daily Rate (dollars per room)
• \( \text{Total Room Revenue} \) — Total revenue from room sales (dollars)
• \( \text{Rooms Sold} \) — Total number of rooms sold (count)

Explanation: ADR calculates the average price at which hotel rooms are sold during a specific period, helping hotels evaluate their pricing performance.

3. Importance of ADR Calculation

Details: ADR is crucial for hotel revenue management, pricing strategy optimization, competitive analysis, and financial performance evaluation. It helps hotels maximize revenue while maintaining occupancy rates.

4. Using the Calculator

Tips: Enter total room revenue in dollars and the number of rooms sold. Both values must be positive numbers (revenue > 0, rooms sold ≥ 1).

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 with 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: RevPAR = ADR × Occupancy Rate.

Q3: Should I include taxes and fees in ADR calculation?
A: Standard practice is to calculate ADR using room revenue before taxes and fees for consistent comparison across properties and locations.

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

Q5: What factors affect ADR?
A: Seasonality, demand, competition, hotel amenities, location, booking channel, length of stay, and special events all influence ADR.