ADR Calculator

1. What is the ADR Calculator?

Definition: This calculator computes the Average Daily Rate (A) for a lodging business, such as a hotel or resort, by dividing total revenue by rooms sold. It also estimates ADR (E) using average monthly revenue and total rooms.

Purpose: Helps hoteliers and property managers measure revenue performance per room, optimize pricing strategies, and assess business health in the hospitality industry.

2. How Does the Calculator Work?

The calculator uses these formulas:

Formulas:

$ A = \frac{R}{S} $
$ E = \frac{M \div 30}{N} $

Where:

$ A $: Average Daily Rate (USD/room)
$ R $: Total revenue (USD)
$ S $: Number of rooms sold
$ E $: Estimated ADR (USD/room)
$ M $: Average monthly revenue (USD)
$ N $: Number of rooms in property

Steps:

Step 1: Enter values. Input total revenue ($ R $) and rooms sold ($ S $), or average monthly revenue ($ M $) and total rooms ($ N $).
Step 2: Compute ADR. Calculate $ A = \frac{R}{S} $.
Step 3: Compute estimated ADR. Calculate $ E = \frac{M \div 30}{N} $.

3. Importance of ADR Calculation

Calculating ADR is key for:

Pricing Strategy: Guides room rate adjustments to maximize revenue while maintaining occupancy.
Performance Tracking: Measures revenue per room, complementing metrics like occupancy rate and RevPAR.
Business Health: Indicates financial performance, helping identify trends and inform marketing or operational decisions.

4. Using the Calculator

Example: For a hotel with $ R = \$2,558,000 $, $ S = 18,047 $, or $ M = \$426,333.33 $, $ N = 100 $:

Step 1: Input values.
Step 2: Compute ADR: $ A = \frac{2,558,000}{18,047} = \$141.74 $.
Step 3: Compute estimated ADR: $ E = \frac{426,333.33 \div 30}{100} = \$142.00 $.
Result: $ A = \$141.74 $, $ E = \$142.00 $.

This shows the hotel’s ADR is $141.74 per room, or approximately $142 using monthly estimates.

5. Frequently Asked Questions (FAQ)

Q: How is ADR calculated?
A: ADR is calculated using: (1) $ A = \frac{R}{S} $, dividing total revenue ($ R $) by rooms sold ($ S $), excluding complimentary or vacant rooms; or (2) $ E = \frac{M \div 30}{N} $, dividing average monthly revenue ($ M $) by 30 days and total rooms ($ N $).[](https://www.omnicalculator.com/finance/adr)

Q: Why is ADR important?
A: ADR measures average revenue per room, helping assess pricing effectiveness and financial performance. Combined with occupancy rate, it informs RevPAR for a fuller revenue picture.[](https://www.omnicalculator.com/finance/adr)

Q: How can I increase ADR?
A: Offer unique experiences (e.g., themed rooms), charge more for premium amenities, provide discounts for longer stays, or bundle local events into packages to justify higher rates and boost direct bookings.[](https://www.omnicalculator.com/finance/adr)