ADR Calculator
Calculate Average Daily Rate (ADR) for hotels and hospitality properties. ADR measures the average revenue earned per occupied room and is a key metric in hotel revenue management and real estate investment analysis.
ADR Results
Revenue Analysis
Optimization Insights
Understanding 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. ADR is calculated by dividing total room revenue by the number of rooms sold, providing insights into pricing effectiveness and revenue management strategies.
ADR Formula
ADR = Total Room Revenue ÷ Number of Rooms Sold
ADR vs Other Hotel Metrics
| Metric | Formula | Purpose | Typical Range |
|---|---|---|---|
| ADR | Revenue ÷ Rooms Sold | Average room rate | $50 - $500+ |
| Occupancy Rate | Rooms Sold ÷ Rooms Available | Utilization percentage | 60-90% |
| RevPAR | Revenue ÷ Rooms Available | Revenue efficiency | $30 - $300+ |
ADR by Hotel Category
| Hotel Category | Typical ADR Range | Target Markets |
|---|---|---|
| Luxury | $300 - $800+ | High-end business travelers |
| Upscale | $200 - $400 | Business/conference travelers |
| Midscale | $100 - $200 | Value-conscious travelers |
| Economy | $60 - $120 | Budget travelers |
| Budget | $40 - $80 | Price-sensitive travelers |
Factors Affecting ADR
- Location: Prime locations command higher rates
- Seasonality: Peak seasons increase ADR
- Competition: Local market competition impacts pricing
- Economic Conditions: Business travel affects corporate rates
- Brand Strength: Recognized brands can charge premium rates
- Amenities: Pools, spas, and services justify higher prices
Revenue Management Strategies
- Dynamic Pricing: Adjust rates based on demand and competition
- Length of Stay Discounts: Encourage longer stays with lower nightly rates
- Package Deals: Bundle rooms with other services
- Channel Management: Optimize distribution across booking platforms
- Competitive Analysis: Monitor competitor pricing regularly
ADR Index (ARI)
ADR Index compares your hotel's ADR performance against competitors:
ARI = (Your ADR ÷ Competitor ADR) × 100
ARI > 100 = Performing better than competition
Improving ADR
- Rate Shopping: Analyze competitor pricing strategies
- Segmentation: Different rates for different customer types
- Upselling: Promote higher-rated rooms and packages
- Minimum Stay Requirements: During peak periods
- Advance Booking Discounts: Encourage early reservations
ADR Limitations
- Doesn't Show Occupancy: High ADR with low occupancy may not be optimal
- Seasonal Variations: ADR fluctuates significantly by season
- Compset Dependent: Performance depends on competitor selection
- Channel Mix Impact: Different booking channels have different rates
Tip: ADR should always be analyzed alongside occupancy rate to understand true revenue performance. A balance between rate and occupancy (measured by RevPAR) is often more important than maximizing ADR alone. Use ADR trends to inform pricing strategies and monitor competitor performance regularly.