Revenue & Profit Estimator
Turn ADR and occupancy into P&L
Hotel Break Even Calculator: Room Rate, Profit & Occupancy
For Indian independent hotels. Find exactly how many rooms you need to sell, at what rate, to stop losing money, and start making it.
Most Indian hotel owners set their room rate by copying competitors or guessing. This free hotel profit calculator shows you the exact number: your break-even occupancy, the minimum room rate you must charge at your current fill rate, and your monthly profit or loss, including the real cost of OTA commissions on your bottom line. Takes 2 minutes. No sign-up.
Hotel Basics
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Fixed Monthly Costs Stay the same regardless of occupancy
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Variable Costs Per Room Night Only incurred when a room is sold
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OTA Commission Settings
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Select OTA:
Break-Even Occupancy
--
-- rooms/night needed
Break-Even Room Rate
--
at your current occupancy
Total Fixed Costs/Month
--
must cover every month
Variable Cost/Room Night
--
blended (direct + OTA mix)
Contribution Margin/Room
--
ADR minus variable cost
Current Monthly Revenue
--
at current occupancy & ADR
Monthly Net Position
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before taxes
Revenue to Break Even
--
minimum monthly revenue
| Cost Component | Monthly Amount |
|---|---|
| Total Monthly Costs | -- |
Profitability Zone
Loss Zone: 0% – --% occupancy
Profit Zone: above --%
Your current occupancy: --%
OTA Commission Impact
Break-Even (100% Direct)
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occupancy needed
Break-Even (with OTA Mix)
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occupancy needed
Actionable Insights
How the Break Even Occupancy Formula Works
Break-Even Occupancy Formula
The break-even occupancy formula tells you the minimum percentage of rooms you must sell each night to cover all your costs.
Break-Even Occupancy (%) =
Total Fixed Monthly Costs
÷ Contribution Margin per Room
÷ Total Rooms
÷ 30 days × 100
Total Fixed Monthly Costs
÷ Contribution Margin per Room
÷ Total Rooms
÷ 30 days × 100
Example: Your hotel has 20 rooms. Fixed costs are ₹3,00,000/month. ADR is ₹3,500. Variable cost per room is ₹500.
- Contribution margin = ₹3,500 − ₹500 = ₹3,000 per room
- Rooms needed per month = ₹3,00,000 ÷ ₹3,000 = 100 rooms
- Rooms per night = 100 ÷ 30 = 3.3 rooms/night
- Break-even occupancy = 3.3 ÷ 20 rooms × 100 = 16.7%
Every room you sell above break-even contributes ₹3,000 directly to your profit. The higher your contribution margin (ADR minus variable costs), the fewer rooms you need to sell to break even.
Minimum Room Rate Formula
The break-even room rate tells you the lowest ADR you can charge at your current occupancy without losing money.
Minimum Room Rate =
(Total Fixed Costs ÷ Rooms Sold per Month)
+ Variable Cost per Room
(Total Fixed Costs ÷ Rooms Sold per Month)
+ Variable Cost per Room
Example: 20 rooms at 60% occupancy = 360 rooms sold per month. Fixed costs ₹2,70,000. Variable cost ₹480/room.
- Fixed cost per room sold = ₹2,70,000 ÷ 360 = ₹750
- Minimum room rate = ₹750 + ₹480 = ₹1,230/night
If your ADR is below this number at your current occupancy. You are losing money on every booking. Raise occupancy, raise ADR, or cut variable costs.
How OTA Commission Is Added to the Calculation
OTA commission is a variable cost. It only applies to bookings that come through an OTA. The calculator blends your direct and OTA bookings based on the OTA share % you enter.
OTA Cost per Room =
ADR × Commission %
+ (ADR × Commission % × 18% GST)
+ TDS (0.1%) + TCS (0.5%)
ADR × Commission %
+ (ADR × Commission % × 18% GST)
+ TDS (0.1%) + TCS (0.5%)
On a ₹3,500 room at 18% commission: ₹630 commission + ₹113 GST on commission + ₹3.5 TDS + ₹17.5 TCS = ₹764 total OTA deduction. You receive ₹2,736 net.
The blended variable cost used in the break-even formula = base variable cost + (OTA share % × OTA cost per room). This gives an accurate picture across your full booking mix.
Related Tools & Guides
Frequently Asked Questions
What is the hotel break-even point?
The hotel break-even point is the minimum level of occupancy and revenue at which your total income exactly equals total costs, no profit, no loss. Below this point, you're losing money. Above it, you're profitable. It accounts for both fixed costs (rent, salaries) and variable costs per room sold (housekeeping, laundry, OTA commission).
How is break-even occupancy calculated?
Break-even occupancy = Total Fixed Monthly Costs ÷ (ADR − Variable Cost per Room) ÷ Total Rooms × 100. For example: fixed costs ₹3,00,000 ÷ (₹3,500 ADR − ₹500 variable cost) ÷ 20 rooms × 100 = 50% break-even occupancy. Each room sold above break-even contributes directly to profit.
How does OTA commission affect break-even?
OTA commission increases your variable cost per room sold. If 70% of your bookings come through OTAs at 18% commission, your blended variable cost per room is higher than for direct bookings. This raises your break-even occupancy. You need to sell more rooms to cover the same fixed costs. This calculator shows you the difference between 100% direct vs your current OTA mix.
What is contribution margin per room?
Contribution margin = ADR − Variable Cost per Room. This is how much each room sold contributes toward your fixed costs. Once the total of all contributions equals your fixed costs, you've broken even. Every additional room sold after that is pure profit (contribution margin = profit per room beyond break-even).
What is the break-even room rate?
The break-even room rate is the minimum ADR you must charge at your current occupancy level to cover all costs. Formula: Break-even rate = (Fixed Costs ÷ Rooms Sold per Month) + Variable Cost per Room. If you're at 60% occupancy with 20 rooms, that's 360 rooms sold/month. If fixed costs are ₹2,70,000 and variable cost is ₹480/room: Break-even rate = (2,70,000 ÷ 360) + 480 = ₹750 + ₹480 = ₹1,230/night minimum.
What are typical hotel fixed costs in India?
For a 20-room property in India: Rent/EMI ₹60,000–₹2,00,000; Staff salaries ₹80,000–₹2,50,000; Electricity & water ₹20,000–₹80,000; Internet & phone ₹3,000–₹10,000; Property tax/insurance ₹3,000–₹15,000; Maintenance/AMC ₹8,000–₹25,000; Marketing/PMS ₹5,000–₹20,000. Total typically ₹1,79,000–₹6,00,000/month depending on location and property type.