The occupancy rate is the percentage of available rooms in a hotel that are sold over a specific period. It is calculated using the formula:
Occupancy Rate = (Occupied Rooms / Total Available Rooms) × 100
The number of rooms booked is a key way for hotel managers to evaluate performance. It shows how much demand there is, the effectiveness of pricing strategies, and how well the business is being run.
When occupancy is high, it suggests strong market demand or successful marketing efforts. On the other hand, low occupancy may indicate pricing issues or ineffective marketing strategies.
Revenue managers check this number daily and compare it with Average Daily Rate (ADR) and Revenue per Available Room (RevPAR) to see how well the hotel is performing. The front desk and housekeeping teams rely on these forecasts to plan staffing levels and supply needs.
A high occupancy rate does not always mean high profitability. Balancing occupancy with room rates ensures sustainable revenue and avoids unnecessary operational strain.
