For years, hotel benchmarking has defaulted to one metric: RevPAR. It was the universal KPI that every property, brand – and in every boardroom was used to shape strategy and direction.
NB: This is an article from HotStats
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But today, revenue on its own tells you half of the story. Margins are being squeezed by rising labour costs, inflation, and uneven demand recovery; exposing the blind spots of revenue-only benchmarking.
Take a global brand with 80 properties that celebrated strong RevPAR growth. But when profitability was benchmarked across a customised compset, a different story emerged: labour costs and F&B outlets had risen by 25%, wiping out most of the rate gains. By the time the board saw the numbers, the damage was already done.
When these factors are invisible, profit leaks remain hidden until they show up in the bottom line; often, too late to act. At the same time, owners and asset managers are demanding stronger returns while expecting stronger risk management.
The key question for corporate leaders has changed. It’s no longer “How much revenue did we generate?” but “How much profit did we keep?”
Building a Portfolio CompSet for Profit
Leading brands are moving beyond revenue-only sets to adopt profit-focused compsets. These provide a consistent lens across portfolios, aligning property execution with brand-level strategy.
Unlike traditional approaches, profit-focused compsets capture how efficiently hotels convert revenue into profit, covering GOPPAR, labour ratios, and departmental performance. Standardising these across assets ensures true apples-to-apples comparison, regardless of property size, market, or even segment.
Just as importantly, they equip executives with the insight investors demand, linking property-level execution directly to long-term brand growth.
This shift isn’t about ditching RevPAR, but to enrich revenue benchmarks with the profit insights sought by today’s corporate stakeholders and a changing market.
The Risks of Standing Still
CompSets that fail to account for profit create unnecessary risks:
● Chaos: Without standardised benchmarking, there’s no reliable portfolio view.
● Margin erosion: Revenue-only compsets overlook costs, labour, and departmental performance.
● Competitive edge: Brands that remain RevPAR-only are slower to identify risks and opportunities.
● Investor confidence: Boards demand transparency on profit drivers, not just topline growth.
The cost of inaction is clear: missed opportunities, weaker margins, and diminished trust at the investor level.
