The GOPPAR Model
A Powerful Tool for Performance Management

Revenue management, also called yield management, is the main focus in hospitality. Room nights being a perishable good it is of vital importance selling them for the highest room rate possible before their sudden demise.

Being highly focused on this narrow task hotels will miss out on maximizing efficiency and secondary revenue sources, and are not aware enough of the dependency between those sources. The purpose of this article is to show the possibilities for improved daily performance management by introducing a GOPPAR. The model can easily be tailored and expanded depending on hotel specifics

An Example

In this example we take figures for a whole year for an imaginary hotel with continuous availability of 100 rooms and an occupancy of 70%, giving a total of 36.500 room nights available and 25.550 room nights rented out. To enrich the example variable costs are differentiated between sales & marketing and operations. With regard to rent the first contains transaction costs like commissions paid, and the second for example cleaning costs. In the example there are four revenue sources (rent, services, food & beverage and retail) and four cost types for undistributed fixed costs (wages, utilities, maintenance and general & administrative).

Goopar example 1

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