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
Dual-Brand Hotels

What is the meaning / definition of Dual-Brand Hotels in the hospitality industry?

Also referred to as two pack hotels, dual-brand hotel is a term used to describe a property that combines and houses two hotels which operate separately. Usually these types of hotels combine two brands from the same chain. The economic advantage of this set-up is that both hotels can cater to one demographic specific to their offerings, but are able to share resources like back of house operations. By sharing many resources and expenses, the Dual Brand hotels can reduce their operational costs drastically. The most popular pairings of brands are of select-service and extended-stay hotels under one roof. The dual-brand model offers developers and owners a chance to command a larger market share, maximising potential cash flows and producing a greater return to the land.

Synonyms: Two pack hotel
Dynamic Packaging

What is the meaning / definition of Dynamic Packaging in the hospitality industry?

Dynamic Packaging is a method of creating deals or packages based upon the components selected by the customer.

This method combines inventory (rates and availability) from multiple sources e.g., hotels, rental cars and flights in one online application. It allows the customers to create and book a customized itinerary resulting in a higher flexibility compared to pre-packaged holidays.

 

Synonyms: packaging, dynamic packaging
Dynamic Pricing

What is the meaning / definition of Dynamic Pricing in the hospitality industry?

Successful hotels around the world aim for optimum profitability at all times. There are lots of things a hotel can do towards achieving this. One is for the Revenue Management Team to make Dynamic Pricing part of their overall strategy. Consortia/negotiated rates are no longer fixed (in some cases).

E-commerce

What is the meaning / definition of E-commerce in the hospitality industry?

E-commerce is also known as Electronic Commerce (or EC). It refers to commercial transactions conducted electronically on Internet. It means basically any form of business transaction in which the parties interact electronically rather than by physical exchanges or direct physical contact.

Synonyms: e commerce, e-commerce, ecommerce
Early Bird Discount

What is the meaning/definition of Early Bird Discount in the hospitality industry?

Hotels can increase advanced bookings by offering something called an Early Bird Discount. This is a type of promotion that many hotels across the world use to increase revenue.

Synonyms: Early Bird Discount, early bird
EBITDA

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

EBITDA stands for : Earnings Before Interest, Taxes, Depreciation and Amortization.

This KPI is used to determine how profitable a company or business is with regard to its operations (the profit on the products it produces and sells).

EBITDAR

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

EBITDAR stands for: Earnings Before Interest, Taxes, Depreciation, Amortisation, and Rent

It is the same calculation as EBITDA, with the exception that rents and/or restructuring costs are excluded from the expenses.

It is useful KPI for hotels to evaluate its financial performance.

How do you calculate EBITDAR?

EBITDAR Formula for Hotels, by Xotels

Eco Hotel

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

The term Eco Hotel describes a type of hotel which heavily emphasises sustainability in all its services and products delivered. There are many areas where Eco Hotels show their ability to be sustainable, starting with areas such as green energy and ending at small details such as recyclable straws instead of plastic ones. Eco Hotels have become a preferred accommodation type for environmentally conscious travellers.

Eco Lodge

What is the meaning / definition of Eco Lodge in the hospitality industry?

The term eco lodge refers to a type of accommodation located in a remote destination in nature. Generally eco lodges are equipped with less than 30 rooms. They are designed to have minimal impact on the environment and to be as sustainable as possible in their usage of resources. Furthermore they aim to improve the welfare of the local population by supporting local suppliers and workers.

ED - Electronic Distribution

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

ED stands for: Electronic Distribution (also called online distribution). It is a type of distribution that uses purely electronic media. E-distribution is an important component of E-commerce.

Synonyms: ED, Electronic Distribution
Extranet

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

An Extranet is a website that allows controlled access to partners, vendors and suppliers or an authorised set of customers. In other words it is a channel which can be administered externally via a login into the system.

Fair Market Share

What is the meaning/definition of Fair Market Share in the hospitality industry?

Fair Market Share is an indication that a hotel’s overall performance stacks up against its immediate competitors.

A hotel within a competitive set can work out if it’s getting its Fair Market Share through a simple calculation:

  • Fair Market Share = Total number of rooms at the hotel / Total number of rooms in the comp set
Fam Trip

What is the meaning / definition of FAM Trip in the hospitality industry?

The term FAM stands for Familiarisation. The Tours - commonly known as FAM Trips - are trips organised by travel providers (can be a Tour Operator, an Airline, a Hotel Chain, a Tourism Board or other DMOs representing a Destination, etc.) with the purpose of educating about their products & services and promoting them.

Synonyms: Fam Tour, farm trip
FC - Fixed Costs

What is the meaning / definition of Fixed Costs in the hospitality industry?

Fixed Costs, abbreviated as FC, are costs which are invariable, meaning they stay relatively constant in value despite changes in production or sales rates. Fixed Costs, mixed costs and variable costs make up the total costs at any business. In the hospitality industry Fixed Costs make up a large percentage of total costs incurring, as hotels require many expensive assets such as buildings, technology, furniture and equipment. Successful Hotel Operators are able to reduce Fixed Costs, thereby increasing profitability for hospitality businesses

Synonyms: Invariable Costs, FC, Fixed Costs
Feeder City

What is the meaning / definition of Feeder City in the hospitality industry?

The term Feeder City refers to cities of origin which feed travelers to hubs or gateway cities. Basically it is to determine where does the tourism come from.

Amsterdam - Bangkok - Barcelona - Brussels - Dubai - Jakarta - London - Miami - New York - Paris

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