FO Formula – Room Rate Spread Formula And Calculator

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Calculating the Room Rate Spread

Rate Spread is another important matrix used by the revenue management team in large hotels or by the front office manager in smaller hotel operations.

The value for rate spread is derived from various room types in the hotel to make essential yield decisions by the hotel management. The rate Spread is calculated by taking the difference between the Potential Average Double Rate and the Potential Average Single Rate

The Formula for Calculating Rate Spread

 Rate Spread = Potential Average Double Rate - Potential Average Single Rate

Room Rate Spread (RRS) Calculator

Calculate Room Rate Spread (RRS)

Potential Avg. Double Rate:

Potential Avg. Single Rate:

Rate Spread of Hotel:


Example 1:

Potential Average Single Rate = 150.00

Potential Average Double Rate = 225.00

Rate Spread of the hotel = 225.00 – 150.00

                        = 75.00

Example 2:

Potential Average Double Rate = 109.00

Potential Average Single Rate = 99.00

Rate Spread of the hotel = 109.00 – 99.00

                        = 10.00

Example 3 (Monthly Rate Spread):

Potential Average Double Rate For the Month = 158.88

Potential Average Single Rate For the Month = 129.69

Rate Spread of the hotel = 158.88 – 129.69

                        = 29.19 

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