Hotel Revenue Glossary · Forecasting

Budget Variance

The difference between actual performance and budgeted performance, expressed as a dollar amount or percentage. Positive variance means actual exceeded budget; negative variance means actual fell short. Tracked for occupancy, ADR, RevPAR, and revenue.

Why it matters: Budget variance is the primary accountability metric in hotel management. Revenue managers are evaluated on their ability to meet or exceed budgeted RevPAR. Understanding variance drivers — whether occupancy or rate — guides corrective action.

All glossary terms Forecast Forecast Accuracy RevPAR (Revenue Per Available Room)