For most companies, revenues are a fundamental driver of economic performance. A well designed and logical revenue model reflecting accurately the type and amounts of revenue flows is extremely important. There are as many ways to design a revenue schedule as there are businesses.

Some common types INCLUDE:

• SALES Growth
• Inflationary and Volume/ Mix effects
• Unit Volume, Change in Volume, Average Price and Change in Price
• Dollar Market Size and Growth
• Unit Market Size and Growth
• Volume Capacity, Capacity Utilization and Average Price
• Product Availability and Pricing
• Revenue driven by investment in capital, marketing or R&D
• Revenue based on installed base (CONTINUING sales of parts, disposables, service and add-ons etc).
• Employee based
• Store, facility or Square footage based
• Occupancy-factor base

Revenue for Hotels should be calculated as follows –

• Get the total number of rooms each year along with forecasts
• Hotel Industry tracks occupancy RATES (eg. 80% etc). This means that 80% of the rooms are occupied, others are vacant and don’t result in revenues. Make an estimate of occupancy rate for this hotel.
• Also, make an estimate on Average Rent per ROOM per day on the basis of historicals.
• Total Revenues = Total Number of Rooms x Occupancy Rates x Average Rent per room Per day x 365

For most companies, revenues are a fundamental driver of economic performance. A well designed and logical revenue model reflecting accurately the type and amounts of revenue flows is extremely important. There are as many ways to design a revenue schedule as there are businesses.

Some common types include:

Revenue for Hotels should be calculated as follows –