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.
With this insight, the focus can be put on maximising the revenue per bed rather than only by room. Especially with hostels, where beds are sold individually and rooms are often shared, this ratio allows more accurate and suitable insights. By knowing a hotels ABR, revenue managers can identify the different factors that influence the ABR and thereafter find ways to increase the average rate.
How to calculate the ABR?
Formula: Average Bed Rate = total amount charged for beds / number of beds sold