Restaurants, hotels and travel
ADR (average daily rate)
The average price paid per hotel room sold.
Facts checked against sources onWhat does ADR (average daily rate) mean?
Average daily rate is rooms revenue divided by the number of rooms sold in a period. Example: a hotel earns 120,000 from 800 rooms sold, so its ADR is 150. It counts only rooms that were sold, so empty rooms do not pull it down. Hotels raise ADR through pricing by demand (higher prices on busy nights), a better room mix, and direct bookings that avoid OTA commission. Pushing ADR too high can cut occupancy, which is why RevPAR is the fuller measure.
Where does it come up in case interview prep?
Related terms
- Occupancy rateThe share of available rooms (or beds) that are filled over a period.
- RevPAR (revenue per available room)Rooms revenue divided by all rooms available: occupancy times ADR.
- Online travel agency (OTA)A website or app that sells rooms and flights from many providers, such as Booking.com or Expedia.
- Price elasticity of demandHow strongly the quantity sold reacts to a change in price.
- Prime costFood and drink cost plus labour cost, the two biggest restaurant costs.
- Table turnsHow many times each table is used by a new group in a meal period or day.
- CoverOne guest served a meal: the unit restaurants count.
- Same-store sales (comparable sales)The US name for like-for-like sales: growth at restaurants or stores open in both periods.
Learn it in context
See ADR (average daily rate) at work in a lesson from Hotels and travel, with checks as you go.
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