GOPPAR (Gross Operating Profit per Available Room) is a hotel industry metric that measures a hotel's overall financial performance. It is calculated by dividing the total gross operating profit by the total number of available rooms in the hotel. GOPPAR is used to evaluate the revenue-generating potential of a hotel and is an important indicator of a hotel's financial health.
GOPPAR can vary significantly across different hotel types depending on a variety of factors. Luxury hotels tend to have higher GOPPARs than economy and mid-range hotels due to their higher average daily rates and higher occupancy levels. Hotels in large cities, such as New York or London, can also have higher GOPPARs than hotels in more rural areas due to higher demand and higher average daily rates.
Elements that can impact a hotel's GOPPAR include:
The hotel's pricing strategy, marketing efforts, cost structure, and service offerings also play a role in determining a hotel's GOPPAR.
GOPPAR is calculated by dividing the hotel's total gross operating profit (GOP) by the total number of available rooms.
The GOPPAR formula is: GOPPAR = (Revenue from Rooms – Operating Expenses) / (Number of Available Rooms in a Period)
For example, if a hotel had a total of 100 rooms available, and the total revenue from those rooms was $10,000, and the total operating expenses were $2,000, then the GOPPAR would be ($10,000 - $2,000) / 100 = $80.
There are many ways that hotel owners and operators can increase GOPPAR at their properties, including:
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