👉 RevPAR… after deducting the cost of selling the room.
📘 What is NetRevPAR?
NetRevPAR (Net Revenue per Available Room) measures the net revenue generated per available room after deducting the costs associated with distribution and sales.
Unlike traditional RevPAR, NetRevPAR focuses not only on how much revenue the hotel generates, but on how much revenue actually remains after costs such as:
- OTA commissions,
- distribution costs,
- marketing,
- intermediary fees,
- acquisition campaigns,
- commercial expenses.
For this reason, it is considered a much more profitability-oriented KPI.
📊 NetRevPAR Formula
NRevPAR = (Room Revenue – Distribution Costs) / Available Rooms
Where:
- Room Revenue = total room revenue generated
- Distribution Costs = costs associated with selling those rooms
- Available Rooms = available rooms during the analysed period
✅ Why is NetRevPAR important?
- Measures real profitability rather than gross revenue alone.
- Helps identify excessive dependency on expensive channels.
- Improves pricing and distribution decisions.
- Prevents misleading interpretations of high revenue performance.
- Allows comparison of revenue quality between channels.
💡 Practical example of NetRevPAR
Two hotels both achieve a RevPAR of €120.
However:
- Hotel A mainly sells through direct channels
- Hotel B heavily relies on OTAs with high commissions
Although both hotels generate the same RevPAR, Hotel A achieves a higher NetRevPAR because it retains more net revenue.
🔄 Disambiguation of NetRevPAR
- NetRevPAR vs RevPAR:
RevPAR measures gross revenue per available room.
NetRevPAR measures net revenue after distribution costs. - NetRevPAR vs GOPPAR:
GOPPAR includes overall hotel operating costs.
NetRevPAR focuses specifically on net room revenue profitability. - NetRevPAR vs ADR:
ADR measures average selling price.
NetRevPAR measures how much net revenue each available room actually generates.
In summary: NetRevPAR = the revenue that genuinely remains after paying the cost of selling it.
