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Imagine you own a pub. Would you rather increase prices after 10pm or bundle beer and shot at a favorable price?

Your ultimate KPI in revenue management is revenue per available capacity. In a restaurant business your capacity is calculated as all seats per hour. You should understand the main drivers behind this KPI (revenue per seat hour); 

-average spend per customer

-average duration of a customer visit

-available capacity (opening hours, available tables/seats)

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In average, manpower costs in service businesses amount to 70% of total OPEX. Thus, it is the top priority in service pricing and cost control. To calculate the basic cost driver (USD / manday) in your company, you can easily start with distributing cost over the available capacity. However, to arrive at accurate cost or pricing point, you need to understand cost and capacity calculation. All calculations are based on annual basis.

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