Greetings Owners, and welcome to Rev Up!, a new informational blog hosted by Brett/Robinson’s Revenue Management Team!
First things first, you may be wondering what a Revenue Management team does: our fully staffed team is responsible for, quite simply, maximizing your rental revenue. We monitor your property (or properties) to ensure we are able to bring in as much revenue as possible through having the best balance of price and occupancy.
Who are we? There are three full time team members on our team:
Bryant Loy – Director of Revenue Management
Regan Palmer – Revenue Manager
Bryce Fuhrmann – Revenue Management Analyst
Rental Revenue – When the revenue management team talks about revenue, we refer to gross rental revenue. Rental Revenue for us is the gross rental revenue amount on a reservation. This number does not account for any fees, taxes, or commission.
Revenue Nights – Nights that a unit is booked, and revenue is collected.
Non-Revenue Nights – Nights that a unit is booked, but revenue is not collected. These can include owner stay nights, friend of owner nights, maintenance blocked nights, or any other night that a unit is not available to be sold.
Sellable Nights – Nights where a unit is available to book – does not include blocked or Non-Revenue nights.
Adjusted Occupancy – Occupancy adjusted for nights that are not available to rent. Defined as: Total Revenue Nights / Total Sellable Nights
Calendar Occupancy – A less commonly used measure, we do occasionally look at Calendar Occupancy when comparing ourselves to other units, as some of our market data does not have a great way to differentiate whether a unit was occupied with revenue, blocked, or occupied with a non-revenue stay. Calendar Occupancy is: Total Occupied Nights / Total Nights
Average Daily Rate (ADR) – If you have ever joined an annual rental meeting update with Bill Brett, you’ve probably heard him say “ADR is our average daily rate – now we don’t sell days, we sell nights, but that’s what we call it”. So, how do we measure it? ADR is: Total Revenue / Total Revenue Nights
Revenue Per Available Room Night (RevPAR) – If you were looking for one measure to compare rental performance across similar units, it would be RevPAR. While we don’t typically sell “rooms”, we sell condos/homes, this term still remains the gold standard. This measure helps standardize revenue across similar units depending on how well we were able to maximize revenue for the nights that were available to sell. There are times where you may see the terms Revenue Per Available Unit (RevPAU) or Revenue Per Available Night (RevPAN) somewhere. These are different names for RevPAR, but mean the same thing. The formula to measure RevPAR, RevPAU, and RevPAN is calculated as: Total Revenue / Total Sellable Nights
The Market – You will see us reference The Market in rental meeting decks, all owner updates, discussions with Revenue Management team members, or possibly even in future posts. What is The Market? It is a collection of other professional vacation rental companies in our area that we are able to evaluate our performance against. We use several third-party data providers that aggregate dozens of other rental companies (and thousands of properties) to compare our performance vs. The Market on a daily basis to ensure we are getting your unit more rental revenue than anyone else!
Lead Time – How many days prior to arrival a unit booked. If a unit books for tomorrow, the Lead Time is one day.
Average Length of Stay (ALOS) – Used to determine how long the average guest stays, calculated as: Total Nights / Total Stays
Minimum Length of Stay (MLOS) – The shortest amount of time we will allow a guest to stay. For most properties in our inventory, for most nights, this is three nights.
Short-Term – Stays, revenue, or ADR on reservations of 1 – 27 nights.
Long-Term – Stays, revenue, or ADR on reservations of 28 nights or more.
Our plan moving forward is to publish articles regularly to help break down key concepts, trends, articles, or other topics and keep you informed on what we’re seeing internally, as well as what we’re seeing happen around the vacation rental industry. If you have ideas, things you’d like us to break down, or questions you would like to see addressed, please feel free to shoot us a line at revenuemanagement@brettrobinson.com.
In the meantime, we’ll be working to Rev Up! your unit’s performance!