Hotel Revenue Management Glossary

Need to know what a hotel term means? Look it up in the Xotels Glossary. We explain definitions of terminology industry lingo from hotel revenue management, ecommerce, marketing and distribution.

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Term Definition
AAA Five Diamond Award

What is the meaning / definition of AAA Five Diamonds Award?

The AAA Five Diamond Award is an independent hotel appraisal system rewarded by the AAA (American Automobile Association) to hotels in the U.S., Canada, Mexico and the Caribbean. It can be compared to the 5 Star hotel classification system, known in Europe and other parts of the world.

Synonyms: AAA 5 Diamond award
ABR - Average Bed Rate

What is the meaning / definition of Average Bed Rate (ABR) in the hospitality industry?

ABR stands for: Average Bed Rate

The "Average Bed Rate" is the total amount charged for beds, divided by the total number of beds sold. This ratio allows revenue managers to measure more than just the "Average Room Rate" or ARR.

Synonyms: ABR, Average Bed Rate

What is the meaning / definition of Accommodation in the hospitality industry?

The term accommodation refers to a room, building or lodging which provides shelter for a person to stay, sleep and live. There are many different types of spaces that classify as accommodation, though in the hospitality industry the term is used to refer to a room at a hospitality company such as a hotel, resort, hostel, motel etc.

Administration Costs

What is the meaning / definition of Administration Costs?

Administration costs, also known as overhead costs or fixed costs are the costs which incur on a business or hotel solely from running. These overhead costs are not directly impacted by manufacturing, production or sales volume and can therefore be described as fixed costs. They can be seen as the basic costs that occur without a sale having to be made. Examples for administrative costs are taxes, rent, insurance, licensing fees, utilities, accounting and legal teams, administrative staff, facility upkeep, etc.

On the contrary to these fixed costs stand the variable costs, which vary per product/ service sold.

Synonyms: Administrative expenses, Overhead costs, Fixed costs
ADR - Average Daily Rate

What is the meaning / definition of ADR in the hospitality industry?

ADR stands for: Average Daily Rate

It is a KPI used to calculate the average price or rate for each hotel room sold for a specific day.

It is one of the most common financial indicators to measure how successful the performance of the hotel is against other hotels that have similar characteristics such as size, clientele and location and/or its own previous figures.

How do you calculate ADR?

ADR Formula for Hotels, by Xotels

Synonyms: ADR, Average Daily Rate
ADS - Alternative Distribution System

What is the meaning / definition of ADS in the hospitality industry ?

Alternative Distribution System, short ADS is a term used to describe the distribution via 3rd party websites.

This includes online travel agencies (OTA), travel portals, travel search engines / directories, online hotel consolidators, airline websites with online reservation options.

Synonyms: ADS, Alternative Distribution System
Adult Only Resort

What is the meaning / definition of Adult Only Resort?

Resort targeted towards couples and groups who wish to have a romantic or relaxing holiday. The hotels are only available for guests above the age of 18.

Agency Model

What is the meaning / definition of OTA Agency Model in the hospitality industry?

In hotel revenue management when talking about an Agency Model, we are referring to the commercial model of an OTA (online travel agency). The main characteristic of the Agency Model OTA is that the guest pays the Hotel directly when the stay occurs and the hotel pays the OTA commission after the stay has taken place.

AGM - Annual General Meeting

What is the meaning / definition of Annual General Meeting in the hospitality industry?

A Annual General Meeting (AGM) is a gathering that is held every year to discuss the issues and concerns, the proposed solutions and goals facing a business or hotel in the upcoming year. It is also in this meeting that improvements are made and budgets are formed.

This meeting is done with higher management, like a General Manager, a CEO, and/or the hotel's owner(s) of the hotel. The General Manager commonly goes over the goals of last year’s general meeting first, then explains the proposed goals for upcoming year. The meeting is usually held at the end of a hotel's fiscal year, rather than the end of a calendar year.

Synonyms: AGM
AGOP - Adjusted Gross Operating Profit

What is the meaning / definition of Adjusted Gross Operating Profit (AGOP) in the hospitality industry?

AGOP stands for: Adjusted Gross Operating Profit

AGOP is the figure that is found by subtracting "hotel base management fees" from the "gross operating profit".

Synonyms: AGOP, Adjusted Gross Operating Profit
All Inclusive Hotel

What is the meaning / definition of All Inclusive Hotel in the hospitality industry?

All inclusive hotels incorporate more than solely the price of a room into the price per night, but also three meals per day (Breakfast, Lunch and Dinner), services and activities. Although every hotel is different and may or may not include other service like alcohol, airport transfers, rooms service and specific activities and services, it is a safer way for travellers to budget their expected expenses when travelling.

All Inclusive Resort

What is the meaning / definition of All Inclusive Resort?

An all-inclusive resort is a holiday resort, which, as the name already states, has everything included in the price.


What is the meaning / definition of Allocation in the hospitality industry?

In the hotel industry, allocation describes the process of selecting a number of rooms and making them available for sale. A hotel manager may choose to allocate only a limited amount rooms towards sales in order to have them available for sale when expecting higher revenues at a later period.


What is the meaning / definition of Allotment in the hospitality industry?

The term Allotment is used in the Hotel industry to designate a certain block of pre-negotiated rooms which have been bought out and held by a third party (such as a travel organiser, wholesaler, tour operator, hotel consolidator, travel agent, OTA).

ALOS - Average Length of Stay

What is the meaning / definition of Average Length of Stay in the hospitality industry?

ALOS stands for Average Length of Stay. It is the average amount of days guests stay at the hotel during a particular period.

Synonyms: ALOS, Average Length of Stay

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