CPOR (Cost Per Occupied Room) meaning in hospitality

CPOR (Cost Per Occupied Room) is a financial metric used in the hospitality industry to measure the operational costs associated with occupied rooms. This includes direct costs like housekeeping, laundry, guest supplies and utilities but excludes fixed costs like rent or property taxes. CPOR helps managers understand the variable costs per room occupied so they can plan more precisely and price more effectively.

CPOR is useful for hospitality professionals because it gives a clear picture of the actual cost when a room is occupied. By tracking this metric, hotel managers can make informed decisions on pricing, staffing and resource allocation. It also helps to compare performance across different properties or time periods as it focuses on controllable costs directly related to occupancy. Understanding CPOR means more efficient operations and more profit.

Let’s say you’re the manager of a 50-room boutique hotel and your CPOR is £25 per room. During a busy weekend you have 45 rooms occupied. A local restaurant approaches you about a dinner package. They offer to provide the meals for £30 per person. You know that adding this package will add £5 per room to your CPOR due to extra cleaning and admin costs. With this information you can quickly calculate you need to price the dinner package at least £10 above the restaurant’s cost to maintain your margins. This example shows how understanding CPOR helps you make quick decisions on pricing and partnerships.'