CPOR (Cost per Occupied Room)

CPOR (Cost per Occupied Room) is a key performance indicator (KPI) used in the hospitality industry to measure the efficiency and profitability of a hotel. It represents the average cost incurred by the hotel for each room that is occupied by a guest.

What is the CPOR (Cost per Occupied Room)?

CPOR (Cost per Occupied Room) is a hotel industry metric used to measure the average cost of operating a hotel room for one night. It is calculated by dividing the total operating expenses of a hotel by the number of occupied rooms.

CPOR is an important metric for hotel managers as it helps them to understand the profitability of their hotel. A high CPOR can indicate that a hotel is overspending on its operating costs, while a low CPOR can indicate that a hotel is operating efficiently.

What is CPOR (Cost per Occupied Room) For?

Hotel managers can use CPOR to make informed decisions about how to operate their hotels. For example, a hotel manager may decide to increase room rates or reduce operating costs in order to lower CPOR.

CPOR is just one of many metrics that hotel managers use to measure the performance of their hotels. Other important metrics include:

  • Average Daily Rate (ADR): The average price paid for a room per night.
  • Revenue per Available Room (RevPAR): The total revenue generated by a hotel per available room per night.
  • Gross Operating Profit (GOP): The total profit generated by a hotel after deducting operating expenses.

What Affects CPOR (Cost per Occupied Room)?

Several factors can affect CPOR, including:

  • Hotel Size: Larger hotels typically have lower CPORs than smaller hotels, as they can spread their operating costs over a larger number of rooms.
  • Hotel Location: Hotels located in popular tourist destinations typically have higher CPORs than hotels located in less popular areas.
  • Hotel Amenities: Hotels that offer more amenities, such as pools, fitness centers, and restaurants, typically have higher CPORs than hotels that offer fewer amenities.
  • Hotel Occupancy Rate: Hotels with higher occupancy rates typically have lower CPORs than hotels with lower occupancy rates.

How Do You Calculate CPOR (Cost per Occupied Room)?

To calculate CPOR, the total operating expenses of the hotel are divided by the total number of occupied room nights during a specific period. This includes all costs associated with running the hotel, such as employee salaries, utilities, maintenance, marketing, and administrative expenses.

The formula for calculating CPOR is:
CPOR = Total Operating Expenses / Total Occupied Rooms

To calculate CPOR, you need to consider all the operating expenses incurred by the hotel, including

  • Employee salaries and benefits
  • Utilities (electricity, water, gas)
  • Maintenance and repairs
  • Marketing and advertising
  • Administrative costs
  • Property taxes and insurance
  • Interest on loans

Once you have calculated the total operating expenses, you divide it by the total number of occupied rooms during the specified period to determine the CPOR.

FAQs About CPOR (Cost per Occupied Room)

Q: How Do You Calculate Hours per Occupied Room?

A: To calculate hours per occupied room, divide the total number of labor hours worked in a given period by the total number of occupied room nights during the same period. This metric helps in assessing staffing efficiency relative to hotel occupancy.

Q: What is CPOR Budget?

A: A CPOR budget refers to the planned or targeted CPOR a hotel aims to achieve within a specific period. It is set based on historical data, forecasted occupancy, and anticipated operating expenses, guiding financial and operational strategies.

Q: Do Hotels Charge the Room or Per Person?

A: Hotels typically charge by the room, with rates based on room types and amenities. However, additional charges may apply for extra guests beyond a standard occupancy, and some rates may vary based on the number of occupants.

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