While you might be more accustomed to tracking metrics like RevPAR, ADR, or TrevPAR at your hotel, RevPASH is also an incredibly important metric to measure if you have any kind of restaurant, theatre, or similar outlet in your property where guests gather and spend revenue.
So, let’s explore what RevPASH means for your business.
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What is RevPASH?
RevPASH stands for revenue per available seat hour and applies if your hotel has a restaurant or other food and beverage outlets. RevPASH also occurs outside of the hospitality industry, such as at hairdressers where appointments on weekends are more expensive because there are less slots available.
It was introduced in 1998 and can be calculated hourly, weekly, or monthly.
Tracking the RevPASH metric is important for understanding the usage and revenue of a ‘seat’ and allows you to better plan your food and beverage operations.
How to calculate RevPASH
To calculate RevPASH you need to divide total outlet (e.g restaurant) revenue by the available seats multiplied by opening hours.
For example: $15000/(50 seats x 8 hours) = RevPASH of $37.50.
Once you know how to calculate RevPASH you can start thinking through how you can enhance the revenue of your hotel restaurant. Is it a matter of staying open for longer, getting more customers in at the peak of the day, or running promotions?
Why should you use the RevPASH formula at your hotel?
RevPASH is a great metric to track daily if you have a hotel restaurant. It will let you see the impact of any adjustments you make to your revenue management strategy, and identify any challenges you need to address.
For example, if you notice that guests are coming to eat at your restaurant in small parties of two or three, you could consider changing your layout to include more small tables, allowing more total guests to dine on average.
Or you could attract more diners with meal discounts but raise the prices on your drinks. Keeping an eye on the menu of your closest competitors is also a good idea to see how you can outdo them with your own.
Whatever tactics you try, they have no value if you aren’t measuring their success with RevPASH.
