KPI – Key Performance Indicator

What is the meaning / definition of KPI / Key Performance Indicators in the hotel industry?

KPI is an acronym for: Key Performance Indicator

KPI includes a set or ratios and formulas that help calculate and indicate the performance and progress of a hotel accordingly to their plans and actions.

Here are example of series of standard Key Performance Indicators to monitor and to benchmark performance of different departments in a hotel.

• Accommodation (Rooms)
  • Average Room Rate
  • Bedroom Occupancy Rate
  • Revenue per Available Room
  • Cost per Occupied Room
  • Labour Cost Ratio

• Food
  • Cost of Sales Ratio
  • Gross Profit Ratio
  • Average Spend per customer
  • Labour Cost Ratio.

• Beverage
  • Cost of Sales Ratio
  • Gross Profit Ratio
  • Average Spend per customer
  • Labour Cost Ratio.

• Profitability
  • Operating Profit Ratio
  • Net Profit Ratio

• Liquidity
  • Current Ratio
  • Average payment period
  • Average collection period.

See Also:

• NREVPAR
• GOPPAR
• PROFPAR