Occupancy Rate is a metric that represents the steering performance and it is one of the best ways to rely upon your decisions to get better overall revenue for your hotel.
It is a standard and a good benchmark to be used by property managers.
Property managers should measure the performance and the output that is presented to the customers.
The calculation for the occupancy rate requires the rooms sold and the rooms available at that moment. The rooms sold make up the numerator, and the available inventory makes up the denominator.
Below is the formula to calculate the OCC:
Basically, your occupancy percentage tells you how much of your room inventory you’ve sold on a day or over a given period. This means it indicates how successful you were at selling your rooms.
OCC can be increase or decrease regarding many factors.
There are external and internal factors which affect the OCC. For instance, external factors could be the inflation rate, or the problems caused by the pandemic or the change of the season. There are also some internal factors as for example the reputation of the hotel, the organization and the overall services that the hotel provides. If they are not satisfying the customers, the OCC will be low but if the efforts are good enough the OCC will be significantly high.
Some tips to increase the OCC is to manage to do some internal work, as external factors are not that easy to change.
Property managers need to apply their best efforts to showcase the hotel. They need to apply marketing tools, hire good employees, and take good care of the overall image of the hotel is just some of the thousand of things that the property managers should be taking care of.
Pay attention to detail and use anything that you know your competitor does not take advantage of.
Invest in good quality rather than quantity, as guest rely more and more on the experience these days. Take great care of everything and approach this challenge dynamically. Use a variety of metrics including OCC to see the outcome of your effort.
