What is the definition of NREVPAR or Net REVPAR in the hospitality industry?
NREVPAR stances for: Net Revenue per Available Room
NREVPAR metric is similar to RevPAR, excluding that it factors in the net incomes (meaning that it accounts for circulation costs, transaction fees and travel agency instructions).
Related to REVPAR, NREVPAR eliminates the “apples to apples” evaluation, which is absolutely essential for real measurement of a property’s revenue administration tactics. Factoring the cost of spreading into its calculation is a more clearly routine indicator.
It is irrefutably a useful calculation for Revenue Managers and owners to make a strategic preparation for the hotel. The problem is that, it is problematic to calculate all of the many different types of commission, deal and circulation costs.
How do you calculate NREVPAR?
NREVPAR Formula: (Room Revenue – Distribution Costs) / Available Rooms