What does RevPAR measure in the hospitality industry?

RevPAR, or Revenue Per Available Room, is an essential metric in the hospitality industry. It measures the overall revenue generated from available hotel rooms, providing a clear picture of how well a hotel is performing financially. By taking total room revenue and dividing it by the number of rooms available, RevPAR gives stakeholders insight into both room occupancy and the average revenue earned per room.

This metric is particularly valuable because it encapsulates the effectiveness of a hotel’s pricing and occupancy strategies. Essentially, it reflects how much income a hotel earns from its available room inventory in a given time period, making it a critical tool for assessing the financial health of a hotel.

The other options do not accurately define RevPAR. For instance, while the cost of maintaining a hotel room is an important operational concern, it doesn't relate to the revenue generation aspect that RevPAR focuses on. Similarly, the rate at which rooms are sold relative to inventory pertains to occupancy rate rather than RevPAR itself. Lastly, the total number of guests checked into a hotel is an operational statistic that does not represent revenue or efficiency in terms of room revenue generation. Hence, the measure of total room revenue compared to the number of rooms available captures the essence of RevPAR effectively.