laura resco
How Rooms-Only Business Impacts a U.S. Break-Even Analysis
HotStats | June 18, 2020
When a golfer hits a wayward drive, it triggers what’s referred to as a provisional ball. A provisional is a second golf ball played by a golfer who believes his or her first ball (the stroke just played) may be lost, but not in a penalty area or out of bounds. A provisional is unlike a mulligan, which occurs when a golfer, unheeding of the formal rules of golf, replays a stroke — a do-over — but doesn’t count it against their score. One is within the rules of the game; one is outside it. In May, HotStats published one of its most highly engaged with pieces of content, titled: “Analysis: At What Occupancy Rate Can a Hotel Break E...
3 Reasons to Turn to Benchmarking in the COVID-19 Era
HotStats | May 19, 2020
By Laura Resco You wouldn’t trust a doctor’s mere intuition with your health, right? Of course not. You’d require testing and data. Operational benchmarking is the hotel industry’s electrocardiogram (EKG), MRI, X-ray and ultrasound — the instruments that provide the cold hard facts. Isn’t your bottom line worth it? Among industries, the impact of COVID-19 on the hospitality industry has been especially injurious: halting travel in its tracks, postponing conferences and gatherings and precipitating the furloughs and layoffs of thousands of employees within the space. The unprecedented nature of the disease has rendered obs...
Analysis: At What Occupancy Rate Can a Hotel Break-Even?
HotStats | May 14, 2020
By David Eisen and Laura Resco COVID-19 has made breaking-even more tolerable than the alternative—going broke. It's not the hand hoteliers wanted, but it's the hand they've been dealt, forcing them to approximate at what occupancy rate they can operate their hotel such that cost and revenue are equal. In these extraordinary times, it's been all pain, no gain. But as the global economy resets, hoteliers are digging themselves out from the coronavirus carnage. And a break-even analysis is one way to jumpstart the excavation project. One hotelier who knows this is Imesh Vaidya, CEO of Premier Hospitality, which is based in Alb...
Hotel Data Digest: Seasonality vs. Moving Average
HotStats | November 4, 2019
Tracking the evolution of key performance indicators (KPIs) over time allows hoteliers to identify meaningful trends, create forecasts and budgets and assess the results of different strategies. To perform this kind of analysis, data has to be recorded within consistent time intervals and in chronological order. This is known as a time series. For example, daily occupancy for the past month is a time series: data (occupancy) is recorded within a consistent time interval (daily) and is chronologically displayed. There are many ways of looking at a time series, depending on the kind of insights you want to extract from it. In this article, w...
3 Reasons You Can’t Trust RevPAR
HotStats | October 14, 2019
Revenue per available room, or RevPAR, has historically been the most widely used metric for benchmarking performance in the hospitality industry. Its success as a key performance indicator or KPI is the result of its efficiency and simplicity. RevPAR is efficient because it combines the results of both occupancy and average rate into one number. And it’s simple, because all you need to calculate it is occupancy and average rate: RevPAR = Occupancy * ADR But its simplicity and straightforwardness conceal its faults and limitations. Here are three reasons you can’t put all your eggs in the RevPAR basket: 1. RevPAR does not measure...
5 Reasons Why Agoda’s Mix and Save Feature Could Be Disastrous for Hotel Operations
HotStats | October 2, 2019
By Laura Resco Online travel agencies are digging their fingers further into the hotel industry. One of the latest disrupting features comes from Booking Holdings-owned Agoda and its Mix and Save option, which it hails as a win for budget-conscious travelers. It could also be a loss for hotel operators. The premise is simple: Customers can split their reservation into multiple bookings, across multiple room types, in order to secure the best overall deal. In other words, a guest can book, for instance, a weeklong stay at a hotel, but move their room once, twice or more to optimize the best rate available. It’s a novel idea to be sure ...
Why There Is More Than Just Analyzing RevPAR Index
HotStats | August 19, 2019
By Laura Resco Financial performance in the hospitality industry is traditionally measured in absolute terms: actuals for the relevant KPIs are compared against their budgeted numbers and, from this assessment, action plans are developed to correct course when needed. Moreover, in the presence of changes in market conditions, budgets are revised to make goals reflect the new business environment. This absolute method measures a hotel’s performance against a backdrop of external factors. And although this knowledge is crucial, it by no means suffices to grasp the entirety of an operation’s financial health. The relative method, on th...
