Occupancy, ADR and RevPAR: the 3 numbers every B&B should know

Ask a B&B operator how business is going, and the answer is almost always about one thing: occupancy. "It was a full month" or "it was quiet." Occupancy is easy to feel — you watch your calendar fill up. But it's a dangerous number to steer by on its own, because a full calendar at rates that are too low can earn less than a half-full one at the right price.

To really know whether you're doing well, you need three numbers that every hotelier knows but many small operators never explicitly calculate: occupancy rate, ADR and RevPAR. They sound technical, but they're just three simple divisions. Let's build them up one by one with concrete examples.

1. Occupancy rate — how full are you?

Occupancy is the percentage of your available room-nights that were actually sold.

Formula: room-nights sold ÷ room-nights available × 100

Say you have 5 rooms and you're looking at a 30-day month. That's 5 × 30 = 150 available room-nights. If you sell 90 of them, your occupancy is 90 ÷ 150 = 60%.

One caveat: count only the days you're genuinely open. If you close a few rooms in the low season or take time off, don't count those nights — otherwise your occupancy looks artificially low. Occupancy is useful for measuring how busy you are, but it says nothing about how much you earn per night sold. For that you need the second number.

2. ADR — what does a sold room earn on average?

ADR stands for Average Daily Rate — the average room price per night sold.

Formula: room revenue ÷ room-nights sold

Note: room revenue, not your total revenue. Breakfast, tourist tax, a bottle of cava in the room or other extras strictly don't belong here — they distort your ADR. See More revenue per booking with smart upsells for how to keep those extras separate while still growing them.

Example: those 90 sold nights brought in € 9,900 in pure lodging. Then your ADR is 9,900 ÷ 90 = € 110 per night.

ADR tells you how strong your pricing is. A low ADR at high occupancy is a classic sign you're too cheap: you sell out, but you leave money on the table. A high ADR at low occupancy can mean you're too expensive — or that you're deliberately targeting a premium segment.

3. RevPAR — the number that ties it all together

Here's where it gets interesting. Occupancy and ADR often pull in opposite directions: price sharper and occupancy rises but ADR falls. Raise your prices and the reverse happens. Which choice actually earns more? That's what RevPAR is for — Revenue Per Available Room, the revenue per available room-night.

Formula 1: room revenue ÷ available room-nights Formula 2 (quicker): occupancy rate × ADR

In our example: € 9,900 ÷ 150 = € 66. Or via the second formula: 60% × € 110 = € 66. The same figure.

Why is this so powerful? Because RevPAR judges you on your full capacity, not just the rooms you sold. An empty room drags your RevPAR down, however lovely your ADR was that evening. That makes RevPAR the fairest single number for comparing two months — or two pricing strategies — against each other.

Why RevPAR settles the occupancy-versus-price debate

A concrete example with the same 5 rooms over 30 days (150 available nights):

• Scenario A — fill on price: you drop to € 85 a night and sell 120 nights. Occupancy 80%, ADR € 85. RevPAR = € 85 × 80% = € 68. Revenue: € 10,200.
• Scenario B — quieter but dearer: you hold € 120 and sell 95 nights. Occupancy 63%, ADR € 120. RevPAR = € 120 × 63% = € 76. Revenue: € 11,400.

Scenario A feels better — your calendar is fuller, you're nearly sold out. But scenario B earns € 1,200 more with fewer guests, so less cleaning, fewer breakfasts, less wear and tear. Someone who looks only at occupancy instinctively picks the worse scenario. RevPAR makes it clear at a glance which strategy wins.

That doesn't mean "more expensive" is always better. In a dead low season, filling on price may well be the right call — see More bookings in the low season. The point is that you make that trade-off on numbers, not on gut feeling.

How do you get these numbers out of your bookings?

The arithmetic isn't hard; the gathering is. You have to bring bookings from all channels together — Booking.com, Airbnb, Expedia and your direct bookings — isolate the pure room revenue from extras and taxes, and assign it correctly per period. Do that by hand in a spreadsheet and it's error-prone and eats time every month.

A PMS with a central calendar already holds that raw data. Because every booking — via the channels or via your own commission-free widget — lands in the same calendar in BedFlow PMS, with amounts and length of stay, you can read off occupancy, ADR and RevPAR per week or per month without counting by hand. That way you immediately see whether a price change had an effect, and whether you're leaving money on the table in high season. If you also want prices to move automatically, read Dynamic pricing for your B&B.

In summary

• Occupancy = how full you are (sold ÷ available room-nights). Useful, but incomplete on its own.
• ADR = average room price per night sold (room revenue ÷ nights sold). Measures the strength of your pricing.
• RevPAR = revenue per available room (occupancy × ADR). The number that ties the two together and compares strategies fairly.
• Steer by RevPAR, not occupancy alone — a half-full B&B at the right price often beats a full one at the wrong price.

Want to get these numbers out of your own bookings without the arithmetic? Check the pricing or try BedFlow PMS free for 30 days — no credit card required.