Certified Hospitality Manager (CHM) 2025 – 400 Free Practice Questions to Pass the Exam

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What does 'ADR' stand for in hotel management?

Available Daily Rooms

Average Daily Rate

The term 'ADR' in hotel management stands for Average Daily Rate. This key performance metric is used to evaluate the financial performance of a hotel by measuring the average rental income earned for an occupied room over a specific period, typically calculated on a daily basis. It helps hotel managers understand pricing strategies, assess market demand, and gauge the overall revenue-generating ability of their accommodation.

Calculating the ADR involves taking the total room revenue for a specific period and dividing it by the number of rooms sold during that same period. A higher ADR indicates better revenue performance, while a lower rate may suggest a need to reassess pricing strategies or marketing efforts. Overall, ADR is crucial for financial forecasting and budgeting in the hospitality industry.

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Annual Direct Revenue

Average Daily Reservations

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