financeHospitalityNet··1 min·For: Owner, GM, Revenue, Investor, Ops
Why Hotels Must Shift Focus From RevPAR to GOPPAR
The hospitality industry is facing a strategic crisis where record RevPAR no longer guarantees profit due to surging labor costs and distribution expenses.
Key Takeaways
- 1Shift focus from RevPAR to GOPPAR to account for rising labor and distribution costs impacting margins.
- 2Prioritize ADR growth over occupancy growth, as rate increases yield 60% profit flow-through compared to only 30% for occupancy gains.
- 3Evaluate channel profitability to bridge the widening gap between record high revenues and eroding bottom-line margins.
Source: HospitalityNet
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