Essential terms every hotel professional should know. Click any term to learn more.
Average Daily Rate (ADR) is the average revenue earned per occupied room in a given time period.
A cancellation policy defines the rules and penalties for guests who cancel or modify a confirmed reservation.
A channel manager is software that synchronizes room availability and rates across multiple online booking channels (OTAs, direct website, GDS) from a single interface.
A comp or complimentary is a service, room, meal, or amenity provided to a guest at no charge, typically as a goodwill gesture, loyalty reward, or service recovery.
FIFO is an inventory valuation method where the oldest stock (first in) is used or sold first (first out), ensuring perishable items are consumed before they expire.
Gross Operating Profit Per Available Room (GOPPAR) measures the operating profitability of a hotel per available room.
A Goods Receipt Note (GRN) is a document that records the receipt of goods from a supplier, verifying what was delivered against what was ordered.
A guest folio is the itemized record of all charges and payments associated with a guest's stay at a hotel.
A late checkout is when a guest is allowed to remain in their room past the hotel's standard checkout time, sometimes for an additional fee.
A no-show occurs when a guest with a confirmed reservation fails to arrive at the hotel and does not cancel the booking.
Occupancy rate is the percentage of available rooms that are sold during a specific time period.
An Online Travel Agency (OTA) is a third-party platform that sells hotel rooms and travel services to consumers, earning a commission on each booking.
Overbooking is the practice of accepting more reservations than available rooms to compensate for expected cancellations and no-shows.
A Property Management System (PMS) is the core software that hotels use to manage daily operations including reservations, check-ins, check-outs, room assignments, billing, and housekeeping.
A Point of Sale (POS) system is the hardware and software used to process transactions where a sale occurs, such as a hotel restaurant, bar, or gift shop.
The rack rate is the standard published price for a hotel room before any discounts, promotions, or negotiated rates are applied.
Revenue management is the practice of using data and analytics to predict demand, optimize pricing, and maximize revenue from a hotel's perishable inventory.
Revenue Per Available Room (RevPAR) is a hotel performance metric that measures the average revenue generated per available room, regardless of whether the room is occupied.
A room night is one room occupied (or available) for one night. It is the basic unit of measurement in the hotel industry.
Room turnover time is the duration between a guest checking out and the room being ready for the next guest to check in.
Total Revenue Per Available Room (TRevPAR) measures all revenue generated per available room, including non-room revenue like food and beverage, spa, and other services.
A walk-in is a guest who arrives at a hotel without a prior reservation and requests a room.