RevPAR — Revenue Per Available Room — is the hospitality industry’s standard performance metric. It combines occupancy and rate into a single number that allows comparison between properties and against competitive sets. It is useful for benchmarking. It is not useful for running a hotel.
Two properties can have identical RevPAR and completely different profitability. One runs a 38% GOP margin; the other runs 22%. The difference is the cost of acquiring and delivering that revenue — OTA commissions, food and beverage subsidies, labour efficiency, procurement discipline. RevPAR captures none of those.
The metric that tells an independent owner whether the asset is working is Net RevPAR: room revenue after channel acquisition costs, divided by available rooms. That number, tracked monthly against a consistent benchmark, tells you whether your channel strategy is improving or deteriorating.
Track it alongside GOP margin and you have a picture that no single industry benchmark can give you: how efficiently your hotel earns, and how much of what it earns reaches the owner.
“RevPAR tells you how rooms performed against capacity. It says nothing about cost of acquisition, OTA dependence, or whether the revenue you generated was enough to run a viable business. The owner who tracks Net RevPAR alongside GOP margin is asking the questions that matter.” — Vaishakh Surendran