Do Spa Treatment Rooms Generate Greater Direct Revenue Than Hotel Rooms?

Very few hoteliers stop to compare hotel room versus treatment rooms for revenue - but when analysing the different components, we get a clearer (and surprising) picture of the true revenue-generation capacity of each of these perishable inventories of hotels.

So how can you calculate the revenue for comparison? Let’s take the example of Hotel Traditionalist with 150 rooms and a 6-treatment room spa:

Case study facts

ADR: 350€
Average Hotel Occupancy: 65%
ATR (Average Treatment Rate): 120€
Average Spa Occupancy: 30%

The hotel and spa are open 365 days per year, and the spa is open from 10am to 8pm

The Calculation

Direct revenue per hotel room:
(150 rooms x 65% x 350€ x 365 days)/ 150 rooms
= 83.037€

Direct revenue per treatment room:
(6 rooms x 30% x 10 hours x 120€ x 365 days)/ 6 rooms
= 131.400€

The Takeaway

Offering Spa treatments can potentially generate more income than a hotel room (if assuming fully booked). Not only that, but hotel guests aren’t the only members who can receive access to a spa room hence why it may be easier to bring in clients and introduce them into your offering hence increasing the average spa occupancy.

It is a known fact that having a spa at your hotel can also help your increase hotel occupancy by selling more rooms to guests who are looking for a weekend getaway complete with pampering. This means that a well-thought out wellness offering generates interesting direct revenues as well as potentially substantial indirect revenues through higher occupancy, average spend and ADR - not to mention all the intangible benefits that aren’t that easy to measure thanks to the offering of a Spa & Wellness space.