Unconstrained Demand

What is the meaning / definition of Unconstrained Demand in the hospitality industry?

Unconstrained demand refers to the quantity of rooms in a hotel that could be sold if there were no constraints, no limits.

When considering unconstrained demand, a hotel manager or revenue management team must ask themselves: โ€œIf there was no limitation whatsoever on our hotelโ€™s capacity, during, say, the Christmas and New Year holiday period, what would the total demand for rooms amount to in monetary terms?โ€

But what is the use of knowing this, you might ask yourself!

Well, when total demand for a particular date is identified irrespective of capacity, a hotel can then plan better for the future and perhaps even take steps to increase capacity, to accommodate the demand and therefore maximise revenue. It can also gauge better or even accurately calculate what price to charge for different types of rooms and suites around/on a certain date or period.

See Also:

Synonyms

  • Unconstrained demand

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About the Author:

As CEO and Founder of XOTELS, Patrick Landman has made it his mission to turn hotels and resorts into local market leaders. XOTELSยด diverse expertise and deep-knowledge across revenue management consulting, hotel management, and hotel consulting, enables us to drive results for independent boutique hotels, luxury resorts, and innovative lodging concepts. Below you will find opinion articles written by Patrick Landman.