Hotel Revenue Glossary · Pricing

Rack Rate

The maximum published rate for a room type, historically displayed on a physical "rack" behind the front desk. In modern practice, rack rate serves as the ceiling rate and is rarely the actual selling price. It is the starting point from which discounts are applied.

Why it matters: While rack rate is rarely charged, it serves as the reference point for calculating discount percentages on corporate, promotional, and group rates. It also has legal and regulatory significance in some jurisdictions for advertising and rate transparency.

All glossary terms BAR (Best Available Rate) Corporate Rate ADR (Average Daily Rate)