Enter the total number of rooms sold and the total revenue generated from those rooms to determine the average daily rate (ADR).
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The following formula is used to calculate the average daily rate of a hotel or other daily room offering service.
ADR = R / #RS
- Where ADR is the average daily rate ($/room)
- R is the total revenue generated for the day ($)
- #RS is the number of rooms sold.
What is ADR?
ADR is an acronym that is short for an average daily rate. The average daily rate is a term used to describe the cost of a room at a hotel per day, on average.
How to calculate ADR?
- First, determine the total revenue generated for the day.
This should only include revenue generated directly from the sale of rooms for the night. This should not include extra revenue generated from any restaurants in the hotel. For this example problem, the total revenue generated was $10,000.00.
- Next, determine the total number of rooms sold for the same day.
In this example, the hotel had 100 available rooms and sold 40% of them. This means they only sold out 40 rooms.
- Finally, calculate the average daily rate (ADR).
Using the formula above, the average daily rate is calculated as:
ADR = R/#RS
ADR = $10,000.00 / 40
ADR = $250.00 per room ADR