I85PREP
⌘ K
CRME study materials
CRME study resources

CRME: Performance Measurement and Reporting (KPIs, RevPAR, TRevPAR)

CRME · Work through your exam, one topic at a time.

All guide sections

Performance Measurement and Reporting (KPIs, RevPAR, TRevPAR)

Performance Measurement and Reporting (KPIs, RevPAR, TRevPAR) tests whether you can calculate and interpret the standard hotel metrics, index them against a competitive set, and move from revenue to profit. Expect formulas, fair share, penetration, flow-through, and the limits of each metric.

Core formulas

  • Occupancy = rooms sold ÷ rooms available.
  • ADR = room revenue ÷ rooms sold.
  • RevPAR = room revenue ÷ rooms available = ADR × occupancy.
  • TRevPAR = total revenue ÷ rooms available.
  • ARPAR = (total revenue − variable costs) ÷ rooms available, or (ADR − variable cost per occupied room) × occupancy.
  • GOPPAR = gross operating profit ÷ rooms available.

Indexing and fair share

Index = property metric ÷ comp-set metric × 100. RGI is the RevPAR index; MPI is the occupancy index; ARI is the ADR index. Fair share is the property's share of available rooms in the comp set. An index above 100 means penetration above fair share. A high ADR index with a low occupancy index can still produce a healthy RevPAR index-or not; the arithmetic matters.

Profit and flow

GOPPAR connects revenue to cost. Flow-through = change in GOP ÷ change in revenue; a 40% flow-through means 40 cents of each new revenue dollar reaches GOP. Flex = percentage change in GOP ÷ percentage change in revenue. Both expose cost discipline that RevPAR cannot.

Worked example

250 rooms × 30 days = 7,500 room nights available. Rooms sold 5,250. Room revenue 840,000; F&B 300,000; other 60,000. Variable cost 45 per occupied room. GOP 360,000. Comp-set RevPAR 100.

Occupancy = 5,250 ÷ 7,500 = 70%. ADR = 840,000 ÷ 5,250 = 160. RevPAR = 160 × 0.70 = 112. TRevPAR = (840,000 + 300,000 + 60,000) ÷ 7,500 = 160. ARPAR = (1,200,000 − 236,250) ÷ 7,500 = 128.50. GOPPAR = 360,000 ÷ 7,500 = 48. RGI = 112 ÷ 100 × 100 = 112. The property is winning RevPAR but must check whether the F&B and other revenue carry proportionate costs-TRevPAR alone does not tell you that.

Traps

  • Comparing RevPAR across markets with different rate structures and demand.
  • Using RevPAR as a profit measure.
  • Reporting TRevPAR without the associated costs.
  • Indexing against a comp set with a different room count or segment mix.
  • Reversing flow-through: cost growth can produce positive flow-through on a revenue decline.
  • Mixing available rooms, occupied rooms, and room nights in the same calculation.