RevPAR (Revenue Per Available Room) measures how much room revenue your hotel generates per available room. GOPPAR (Gross Operating Profit Per Available Room) measures how much actual profit remains after all operating costs are deducted across every revenue department. RevPAR tells you how well you are pricing and filling rooms. GOPPAR tells you whether that revenue actually makes money. A hotel can post record RevPAR and still be losing money — GOPPAR is the metric that reveals this truth.
📋 What you will learn in this guide
- What is RevPAR and how is it calculated?
- What is GOPPAR and how is it calculated?
- Why RevPAR alone misleads hotel operators
- The full hotel metric family: RevPAR, NRevPAR, TRevPAR, GOPPAR
- GOPPAR vs RevPAR: side-by-side comparison
- Worked example: same RevPAR, very different GOPPAR
- When to use GOPPAR vs RevPAR
- How to improve GOPPAR without sacrificing RevPAR
- GOPPAR benchmarks by property type
- Where Propeter fits in RevPAR and GOPPAR analysis
- Frequently asked questions
What is RevPAR and how is it calculated?
RevPAR — Revenue Per Available Room — is the most widely used performance metric in the hotel industry. It combines a hotel’s ability to fill rooms (occupancy) with its ability to charge for them (ADR), producing a single number that reflects room revenue efficiency across all available inventory.
RevPAR formula
| Method | Formula | Example (100-room hotel) |
|---|---|---|
| Revenue method | Room Revenue ÷ Total Available Rooms | $15,000 ÷ 100 = $150 RevPAR |
| Rate × Occupancy method | ADR × Occupancy Rate | $200 ADR × 75% = $150 RevPAR |
Both methods produce identical results. The rate × occupancy method is more useful for forward-looking analysis — forecasting future RevPAR by modelling rate and occupancy scenarios independently. The revenue method is faster for historical reporting.
What RevPAR tells you
RevPAR answers one question very well: how efficiently is your hotel converting available room inventory into room revenue? It is the primary benchmarking metric used in STR reports, ownership presentations, and revenue management dashboards because it allows clean property-to-property comparison regardless of hotel size.
RevPAR Index (RGI)
RevPAR is most useful as a relative metric — tracked against your competitive set via the RevPAR Index, also called RGI (Revenue Generation Index). Its occupancy counterpart is MPI (Market Penetration Index) and its rate counterpart is ARI (Average Rate Index). An RGI above 100 means you are capturing more than your fair share of available revenue. Below 100 means competitors are outperforming you. RevPAR alone, without a competitive benchmark, tells you very little about whether your pricing strategy is working.
What is GOPPAR and how is it calculated?
GOPPAR — Gross Operating Profit Per Available Room — is the profit equivalent of RevPAR. Rather than measuring room revenue, it measures the gross operating profit generated per available room after all operating costs across every department have been deducted.
GOPPAR formula
| Step | What it includes |
|---|---|
| Total Revenue | Rooms + Food & Beverage + Spa + Parking + Meeting space + All ancillary |
| minus Departmental Expenses | Rooms dept (housekeeping, front office, laundry) + F&B cost of sales + Spa costs + Other dept costs |
| = Gross Operating Profit | Revenue minus all variable and semi-fixed operating costs |
| ÷ Total Available Rooms | Same denominator as RevPAR |
| = GOPPAR | Profit generated per available room |
GOPPAR does not deduct fixed charges — rent, management fees, depreciation, interest expense, or income taxes. Those are subtracted further down the P&L to reach Net Operating Income (NOI). GOPPAR specifically measures operational management performance, independent of how the property is financed or structured.
Common GOPPAR mistake
Many operators confuse GOPPAR with NOI-PAR (Net Operating Income Per Available Room). GOPPAR stops at Gross Operating Profit — before fixed charges. NOI-PAR deducts rent, depreciation, taxes, and management fees. GOPPAR is the right metric for benchmarking management performance. NOI-PAR is the right metric for investment returns analysis.
Why RevPAR alone misleads hotel operators
RevPAR has one critical flaw: it is blind to costs. A hotel can grow RevPAR every month while simultaneously destroying profitability. Here are the four most common ways this happens in practice:
1. OTA commission growth outpaces rate growth
A hotel raises its ADR from $180 to $200, growing RevPAR by 11%. But if OTA bookings grow from 40% to 65% of the mix during the same period, the net room revenue received by the hotel — after paying 15–25% OTA commission — may actually be lower than before the rate increase. RevPAR goes up. Net revenue goes down. GOPPAR falls.
2. Labour costs rise faster than occupancy
Filling more rooms means more housekeeping hours, more front-of-house staffing, more laundry. At high occupancy levels — especially above 85% — labour costs can increase faster than the incremental revenue from those additional rooms, compressing GOPPAR even as RevPAR climbs.
3. Ancillary departments operate at a loss
A hotel’s F&B department might generate $800,000 in revenue annually — which boosts TRevPAR meaningfully — but run at a departmental operating loss of $120,000. RevPAR does not capture F&B revenue at all. GOPPAR captures both the revenue contribution and the cost, giving an honest view of the department’s true impact on the business.
4. Discounting fills rooms that cost more to service than they earn
Flash promotions and deep seasonal discounts can push occupancy to 95%+ and lift RevPAR. But at rates below the all-in cost of servicing a room (labour, energy, amenities, linen, breakfast if included), those rooms are being sold at an operating loss. GOPPAR makes this visible. RevPAR does not.
The occupancy trap
Many smaller independent hotels operate on the belief that 90%+ occupancy is always the goal. It is not. The occupancy level that maximises GOPPAR is often below maximum occupancy, because rate can be held high enough to cover costs comfortably. Find it in your own data by comparing GOPPAR across months with different occupancy levels, rather than chasing full rooms.
The full hotel metric family: RevPAR, NRevPAR, TRevPAR, GOPPAR
RevPAR and GOPPAR sit at opposite ends of a spectrum of hotel performance metrics, each measuring a progressively fuller picture of financial performance. Understanding where each sits in the chain is essential for using them correctly.
📊 RevPAR
- Room revenue only
- No cost deduction
- Industry-standard benchmark
- Best for: daily pricing, STR comparison
💳 NRevPAR
- Room revenue minus distribution costs
- Deducts OTA commissions + GDS fees
- Shows true net room revenue received
- Best for: channel mix analysis
🏨 TRevPAR
- All revenue streams included
- Rooms + F&B + Spa + Ancillary
- No cost deduction
- Best for: total commercial performance
💰 GOPPAR
- All revenue minus all operating costs
- Reflects actual profitability
- Includes every dept, every cost
- Best for: strategic decisions, ownership reporting
The progression from RevPAR → NRevPAR → TRevPAR → GOPPAR tells an increasingly complete story of hotel financial performance. Each step adds either a cost deduction or a revenue inclusion that the previous metric missed. Using only RevPAR is like reading only the top line of a P&L and concluding the business is healthy.
GOPPAR vs RevPAR: side-by-side comparison
| Attribute | RevPAR | GOPPAR |
|---|---|---|
| What it measures | Room revenue efficiency | Operating profitability |
| Revenue included | Rooms only | All departments (rooms, F&B, spa, ancillary) |
| Costs deducted | None | All departmental and undistributed operating costs |
| Formula | Room Revenue ÷ Available Rooms (or ADR × Occupancy) | Gross Operating Profit ÷ Available Rooms |
| Can it be negative? | No — revenue is always ≥ 0 | Yes — if operating costs exceed revenue |
| OTA commission impact | Not visible | Fully reflected in departmental costs |
| F&B/spa performance | Excluded entirely | Included — revenue and costs |
| Best for | Day-to-day pricing decisions, competitive benchmarking | Strategic planning, budget setting, ownership reporting |
| Industry benchmark source | STR Global, CoStar | USALI (Uniform System of Accounts for the Lodging Industry) |
| Reporting frequency | Daily | Monthly / quarterly |
Worked example: same RevPAR, very different GOPPAR
Consider two 80-room boutique hotels in the same city, both reporting identical RevPAR of $160 on the same night. On the surface, they look equally well-managed. GOPPAR tells a completely different story.
$160
RevPAR — identical for both Hotel A and Hotel B
$72
GOPPAR — Hotel A (direct bookings, lean ops)
$38
GOPPAR — Hotel B (OTA-heavy, high labour costs)
45%
GOPPAR-to-RevPAR ratio for Hotel A vs. 24% for Hotel B
| P&L Line | Hotel A | Hotel B |
|---|---|---|
| Room Revenue (night) | $12,800 | $12,800 |
| OTA Commission (Hotel A: 15% mix / Hotel B: 65% mix) | −$480 | −$2,080 |
| Net Room Revenue | $12,320 | $10,720 |
| F&B Revenue | $3,200 | $1,800 |
| Spa & Ancillary Revenue | $1,600 | $400 |
| Total Net Revenue | $17,120 | $12,920 |
| Rooms Dept Costs (housekeeping, front office) | −$3,200 | −$4,100 |
| F&B Dept Costs | −$1,600 | −$1,200 |
| Undistributed Expenses (S&M, utilities, admin) | −$6,560 | −$4,580 |
| Gross Operating Profit | $5,760 | $3,040 |
| GOPPAR | $72.00 | $38.00 |
Hotel A spends more on undistributed costs (including sales and marketing to drive direct bookings), yet its GOPPAR is still higher because of three structural advantages: a direct booking mix that cuts OTA commissions, higher-revenue ancillary departments, and leaner housekeeping costs (fewer OTA bookings means fewer turnover cleans on back-to-back one-nighters). RevPAR misses all three. GOPPAR captures every one.
When to use GOPPAR vs RevPAR
The right answer is almost always both — but they serve different purposes. Here is a practical guide to when each metric should drive the decision:
1
Use RevPAR for: daily rate decisions and competitive benchmarking
RevPAR is your operational compass. Track it daily, compare it against your STR comp set, and use it to trigger pricing moves — rate increases when RevPAR pace is ahead of last year, promotions when it is behind. It is fast to calculate and universally understood.2
Use GOPPAR for: monthly performance reviews and ownership reporting
GOPPAR is your financial health check. Review it monthly against budget, and use it to evaluate whether your revenue management strategy is actually producing profit — not just revenue growth. Any investor or owner presentation should lead with GOPPAR, not RevPAR.3
Use NRevPAR for: channel mix decisions
When evaluating whether to invest in a direct booking engine, run a loyalty programme, or renegotiate OTA agreements, NRevPAR is the decisive metric. It shows the true net revenue impact of your channel strategy after commissions — which RevPAR entirely ignores.4
Use TRevPAR for: total commercial strategy and ancillary revenue development
TRevPAR tells you whether your hotel is monetising guests across all touchpoints — not just rooms. If TRevPAR is growing faster than RevPAR, your ancillary strategy is working. If it is flat, F&B, spa, and upsell revenue is being left on the table.5
Use GOPPAR for: comparing properties in a portfolio
When managing multiple properties, RevPAR comparisons can be distorted by market differences, room mix, and star rating. GOPPAR-to-RevPAR ratio — the share of RevPAR that becomes gross profit — is a cleaner measure of relative operational efficiency across a portfolio.6
Use GOPPAR for: evaluating pricing strategy changes
If you shift from an OTA-heavy to a direct-booking model, RevPAR may temporarily dip as you reduce OTA distribution. GOPPAR will tell you whether that shift is actually improving profitability — which is the outcome that matters, not the revenue headline.
How to improve GOPPAR without sacrificing RevPAR
Improving GOPPAR is not about cutting revenue — it is about making every revenue dollar work harder. Here are the highest-impact levers, ranked by typical return-on-effort:
Lever 1: Shift bookings from OTA to direct
Every percentage point of booking mix shifted from OTA to direct eliminates commission on those bookings. A hotel with 60% OTA dependence paying 20% commission that moves to 40% OTA dependence saves roughly 4% of total room revenue in pure cost reduction — with no change to RevPAR. For a $3M/year hotel, that is $120,000 dropping directly to GOPPAR. Direct booking engines, loyalty programmes, and member-only rates are the primary tools.
Lever 2: Grow ancillary revenue per occupied room
F&B, spa, parking, early check-in fees, and in-room add-ons all flow directly into TRevPAR and GOPPAR without consuming additional room inventory. A hotel that grows ancillary revenue from $25 to $45 per occupied room at 70% occupancy on a 100-room property adds about $511,000 in annual total revenue ($20 × 70 occupied rooms × 365 nights) — roughly $14 of TRevPAR per available room night — with zero rate change or occupancy impact. GOPPAR grows; RevPAR does not even register the improvement.
Lever 3: Optimise housekeeping and labour scheduling
Labour is typically the largest single operating cost in a hotel. Demand-based scheduling — matching staffing levels to forecasted occupancy rather than fixed rosters — is one of the fastest GOPPAR improvement tools available. A 10% reduction in housekeeping hours against a static revenue base moves directly to gross operating profit.
Lever 4: Implement rate floors — and hold them
One of the most common GOPPAR destroyers is last-minute discount panic: dropping rates to fill empty rooms at prices below the all-in cost of servicing them. Properly configured rate guardrails — floor prices below which recommendations cannot go — protect GOPPAR in low-demand periods. In Propeter, recommendations without a floor and ceiling are blocked from publishing, and direct booking quotes are clamped to the floors you set.
Lever 5: Manage utility and maintenance costs proactively
Energy, water, and preventative maintenance costs are often under-managed in independent hotels relative to their GOPPAR impact. A 15% reduction in utility costs on a property spending $200,000 annually on energy is $30,000 directly to GOPPAR. For a 100-room hotel at 70% occupancy (25,550 room nights a year), that is the equivalent of lifting ADR by about $1.17.
The GOPPAR-RevPAR balancing act
The goal is not to maximise GOPPAR at the expense of RevPAR, or RevPAR at the expense of GOPPAR. The goal is to close the gap between them — to ensure that as much of each RevPAR dollar as possible reaches Gross Operating Profit. Track your GOPPAR-to-RevPAR ratio over time and against comparable properties: a falling ratio is an early signal that the cost structure needs attention.
GOPPAR benchmarks by property type
Because GOPPAR reflects every operational cost, the ratio varies significantly by property type. Published GOPPAR benchmarks come from sources such as hotel P&L benchmarking datasets; the table below shows the typical direction and the main drivers, not targets. Compare your own figures with properties of the same type in your market.
| Property type | GOPPAR-to-RevPAR ratio (relative) | Key cost driver | Primary GOPPAR lever |
|---|---|---|---|
| Luxury / Full-service | Lower | High labour, F&B losses common | Ancillary revenue growth, direct booking mix |
| Boutique / Lifestyle | Moderate | Labour, OTA commission | Direct bookings, loyalty programme, upsells |
| Apartment hotels | Moderate to higher | Housekeeping, utilities | LOS pricing, direct corporate bookings, accounting automation |
| Serviced apartments | Higher | Lower F&B drag, minimal F&O costs | Corporate rate codes, long-stay pricing optimisation |
| Budget / Limited-service | Higher | Lower labour per room | Flash deals, rate floor enforcement, channel costs |
| Hostels | Varies widely | High bed turnover, variable labour | Bed-level dynamic pricing, direct bookings |
If your property’s GOPPAR-to-RevPAR ratio is noticeably below comparable properties of the same type, it is worth auditing your three largest cost categories — labour, OTA commission, and energy — before making pricing-side changes.
Where Propeter fits in RevPAR and GOPPAR analysis
Revenue management tools naturally focus on RevPAR, because room revenue data lives in the PMS. GOPPAR needs cost data from your accounting system as well. Here is where each input comes from, and where Propeter — a revenue management and pricing system that works with your PMS — fits:
| What you need to track GOPPAR properly | Where it comes from |
|---|---|
| Room revenue by channel (OTA vs direct vs corporate) | Reservation data from your PMS, which Propeter reads from connected PMSs |
| OTA commission deduction per booking | Your OTA contracts and channel statements |
| F&B, spa, ancillary revenue capture | PMS and POS postings |
| Departmental cost data | Your accounting system; Propeter connects to Xero and maps your chart of accounts per property |
| Undistributed expense allocation | Your accounting system, using USALI categories |
| RevPAR, ADR and occupancy reporting | Propeter reporting (ADR, RevPAR, occupancy and pickup) |
| Rate floor enforcement to protect GOPPAR floors | Propeter guardrails: floors, ceilings and maximum discount caps per room type |
| Direct booking growth tracking (NRevPAR improvement) | Propeter’s direct booking engine (0% commission on direct bookings) and loyalty module |
See GOPPAR and RevPAR side by side on your property
Work through your own numbers with the RevPAR calculator, or book a demo to see how Propeter’s rate recommendations, guardrails and Xero connection would support a profit-first pricing strategy at your property.
Frequently asked questions about GOPPAR vs RevPAR
What is the difference between GOPPAR and RevPAR?
RevPAR (Revenue Per Available Room) measures total room revenue divided by available rooms — it tracks how well a hotel fills and prices its rooms but ignores all operating costs. GOPPAR (Gross Operating Profit Per Available Room) measures total operating profit across all revenue streams divided by available rooms, after subtracting all departmental and undistributed operating expenses. GOPPAR tells you how much profit each room generates; RevPAR tells you how much revenue it generates.
How do you calculate GOPPAR?
GOPPAR = Gross Operating Profit ÷ Total Available Rooms. Gross Operating Profit = Total Revenue (rooms + F&B + spa + ancillary) minus Total Operating Expenses (housekeeping, F&B cost of sales, front office) minus Undistributed Expenses (sales and marketing, property maintenance, utilities, admin and general). It does not include fixed charges like rent, management fees, depreciation, or income tax.
How do you calculate RevPAR?
RevPAR can be calculated two ways: (1) Room Revenue ÷ Total Available Rooms, or (2) ADR × Occupancy Rate. For example, a 100-room hotel earning $15,000 in room revenue on a given night has a RevPAR of $150. The same hotel with an ADR of $200 and 75% occupancy also produces a RevPAR of $150. Both methods give the same result.
Why can RevPAR increase while GOPPAR falls?
RevPAR can rise while GOPPAR falls when revenue growth is outpaced by cost growth. Common causes: heavy OTA commission spend eating into room revenue, increased housekeeping or labour costs at high occupancy, aggressive discounting that fills rooms at unprofitable rates, or ancillary departments running at a loss that offsets room revenue gains. A hotel can have record RevPAR and still be operating at a loss — GOPPAR is what reveals this.
What is a good GOPPAR for a hotel?
A ‘good’ GOPPAR varies by property type and market. Rather than chase a single number, compare your GOPPAR-to-RevPAR ratio (the share of each RevPAR dollar that becomes gross operating profit) with properties of the same type in your market. Limited-service and apartment hotels usually achieve higher ratios than full-service hotels because of lower departmental costs. Any positive GOPPAR means the hotel covers operating expenses. Negative GOPPAR means operating at a loss before fixed charges.
What is TRevPAR and how does it differ from RevPAR?
TRevPAR (Total Revenue Per Available Room) includes all revenue streams — rooms, F&B, spa, parking, meeting space, retail — divided by available rooms. RevPAR only counts room revenue. TRevPAR is a better measure of a hotel’s full commercial performance across all departments. GOPPAR then takes TRevPAR further by deducting operating costs to show actual profitability per available room.
What is NRevPAR and how is it used?
NRevPAR (Net Revenue Per Available Room) is room revenue minus distribution costs (OTA commissions, GDS fees, booking engine fees) divided by available rooms. It bridges the gap between RevPAR and GOPPAR by showing how much room revenue actually reaches the hotel after paying for distribution. A hotel with high RevPAR but heavy OTA usage may have NRevPAR well below its RevPAR — NRevPAR makes this visible.
Should hotels use GOPPAR or RevPAR for pricing decisions?
For day-to-day pricing decisions, RevPAR and ADR are the primary tools — they reflect real-time room revenue response to rate changes. For strategic decisions — annual budgeting, ownership reporting, or evaluating whether a high-occupancy strategy is actually profitable — GOPPAR is the superior metric. Best practice: use RevPAR to steer pricing, and GOPPAR to validate that pricing strategy produces actual profit.
How does OTA commission affect GOPPAR?
OTA commissions of 15–25% directly reduce the net room revenue that flows into gross operating profit. A hotel with 60% OTA mix at 20% commission loses $20 of every $100 in room revenue before any other cost is applied. Two hotels with identical RevPAR can have dramatically different GOPPAR — the one with more direct bookings retains more revenue, producing a higher gross operating profit per available room.
What costs are excluded from GOPPAR?
GOPPAR excludes fixed charges: rent and lease costs, management fees, insurance, property taxes, depreciation and amortisation, interest expense, and income taxes. These are subtracted from Gross Operating Profit to arrive at Net Operating Income (NOI). GOPPAR represents operational efficiency before ownership and financing costs — which is why it is the preferred metric for benchmarking management performance independently of ownership structure.
How can a hotel improve its GOPPAR?
The most effective GOPPAR improvement levers are: (1) Shift OTA bookings to direct — each 10% shift saves 15–25% in commission on those bookings. (2) Grow ancillary revenue from F&B, spa, and upsells without adding room inventory. (3) Control labour costs through demand-based staffing schedules. (4) Enforce rate floors to prevent discounting below the cost of servicing a room. (5) Reduce utility and maintenance costs through proactive management programmes.
About this guide
Written by the Propeter team. Worked examples use illustrative numbers. Last reviewed: October 2026.
Related Articles
How to choose hotel revenue management software for independent properties in Australia
The best hotel revenue management software for independent Australian properties is not determined…
Hotel Tech Stack for Revenue Optimization: Complete Guide (2026)
The best hotel tech stack for revenue optimization in 2026 has six core…
Propeter vs Competitors: Which Hotel Revenue Management Solution Wins?
Propeter is a revenue management and pricing system for hospitality that works with your PMS, with a direct booking engine, guest CRM, loyalty…
Calculate your RevPAR
Apply the formulas in this guide to your own occupancy and ADR.