Hotel Attrition Rate Calculator
Results Summary
Understanding Hotel Attrition Calculation
In the hospitality industry, "attrition" refers to the difference between the number of hotel rooms blocked for an event and the number of rooms actually occupied by attendees. Most hotel contracts include an attrition clause that protects the hotel from lost revenue when a group fails to fill its committed block.
How Attrition is Calculated
The standard formula for attrition is straightforward, but the financial implications depend on the "Allowable Attrition" or "Slippage" percentage agreed upon in your contract.
- Total Attrition: Contracted Rooms – Actual Rooms Used.
- Attrition Percentage: (Unused Rooms / Total Contracted Rooms) x 100.
- Billable Rooms: Total Attrition – (Contracted Rooms x Allowable %).
Practical Example
Imagine you contract 100 rooms for a conference with a 20% allowable attrition clause. This means the hotel expects you to fill at least 80 rooms. If your group only uses 70 rooms:
- Your total attrition is 30 rooms (100 – 70).
- Your allowable attrition is 20 rooms (20% of 100).
- You are responsible for paying for 10 rooms (30 total unused – 20 allowed) at the agreed room rate.
Why This Matters for Event Planners
Monitoring your pickup (the number of rooms reserved) regularly is crucial for budget management. If you notice your pickup is low months before the event, you may be able to renegotiate the block or increase marketing efforts to avoid heavy financial penalties. Always ensure you understand whether your attrition is calculated on a "cumulative" basis (over the whole event) or "night-by-night," as this significantly changes the final cost.