Key Performance Indicator

What is the definition of KPI / Key Performance Indicators in the hotel industry?

KPI is a short form for: Key Performance Indicator

KPI includes a set or ratios and formulas that help compute and point to the routine and development of a hotel accordingly to their plans and actions.

Here are example of series of normal Key Performance Indicators to check and to benchmark performance of diverse departments in a hotel.

Accommodation (Rooms)

  • Regular Room Rate
  • Bedroom Occupancy Rate
  • Revenue per Available Room
  • Cost per Occupied Room
  • Labour Cost Ratio

Food

  • Cost of Sales Ratio
  • Gross Profit Ratio
  • Average Spend per customer
  • Labour Cost Ratio.

Beverage

  • Cost of Sales Ratio
  • Gross Profit Ratio
  • Average Spend per customer
  • Labour Cost Ratio.

Profitability

  • Operating Profit Ratio
  • Net Profit Ratio

Liquidity

  • Current Ratio
  • Average payment period
  • Average collection period.