The Vacation Rental Key with T and T

Episode 18 - From Occupancy To RevPAR: Metrics That Drive Profits

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Want a cleaner, stronger playbook for running a profitable vacation rental portfolio? We dig into the KPIs that actually move the needle—what to track, how often to review it, and how to turn numbers into decisive action. From occupancy and ADR to total RevPAR, we break down the revenue signals that reveal pricing power, guest mix, and true yield, then show how a simple weekly cadence keeps you ahead of soft weeks and mispriced dates.

We go beyond topline performance to the expense side most managers underestimate. You’ll hear how to measure maintenance productivity with closed work orders and labor billed, keep payroll honest with pre-process audits, and treat overtime as a management KPI that protects margins and people. For housekeeping, we outline a practical defect rate using inspections and guest complaints, plus the piece-rate checks that tie pay to time and outcomes. We also share an operations win: cutting laundry misses to near zero by closing the loop between cleaners, laundry, and accurate unit data.

Marketing has to earn its spend, so we unpack a weekly dashboard that tracks click-through rate, conversion rate, cost per click, and actual bookings. We highlight feeder markets—by geography and by channel—so budget follows proven demand instead of habit. Then we zoom out to growth: measure net units, be willing to part ways with misaligned owners, and run an annual off-site where every department sets one owner-facing, one guest-facing, and one internal KPI. Scoreboards, clear targets, and steady iteration turn data into a culture of accountability and wins you can show to owners.

If you want a step-by-step framework to steady revenue, sharpen operations, and scale with confidence, this conversation hands you the metrics and the rhythm to do it. Subscribe, share with a fellow manager, and leave a review to help more operators find the show. What KPI will you add to your dashboard this week?

SPEAKER_01:

You're listening to the Vacation Rental team with T and T, the podcast for Vacation Rental Managers and by Vacation Rental Managers. I'm Tim Caffery, and I manage two companies. One in Virginia and one in North Carolina. And I'm one of the two teams.

SPEAKER_00:

And on the other team, Tiffany Edwards, born and raised in the vacation rental business. I help manage our family businesses from T West all the way to Hawaii.

SPEAKER_01:

In the next 30 minutes, we're going to give you our keys to success in the vacation rental business. We're back, and we promised the last episode to cover in this episode some key performance indicators. That's what we have for you today. I know you're excited about this, Tiffany.

SPEAKER_00:

Listening back to the last episode, knowing that we were going to do KPIs, it was like all that I heard KPI, KPI, KPI. And you know, when we started talking about this, there are so many KPIs that everyone should be monitoring, looking at, having their team look at. But you and I have some of our favorite KPIs, little fan favorites that we love. And I'd love to share those today as well.

SPEAKER_01:

Yeah. So we like to be organized in spite of appearances. So we've divided this up amongst three headers, if you will. Number one, we're going to start with these KPIs that we think you should be doing. And if you're not, maybe it's time for some self-reflection. And then we want to kind of dive into some KPIs maybe you didn't think about that help you on a day-to-day running your business. And then finally we'll cover our favorites. So let's get right into it. Let's talk about the headliners, if you will. What are some of those that everybody should be doing? Take it away, Tiff.

SPEAKER_00:

So, number one, and we don't have to take too much time on this one, but occupancy. You need to be looking at overall what your occupancy is for all of your portfolio. And this is something that you need to be looking at on a weekly basis. This is something that you need to be looking ahead and something that you also be looking at retroactively for the year.

SPEAKER_01:

Amen. No reason to be in business if you don't know what you're doing in terms of filling the properties. Because after all, I think most of our owners are very focused on that particular KPI, right? I think right below that would be ADR, your average daily rate. It really tells you about your area, because as we've documented, the areas I'm very involved with are very different than what Tiffany involves herself with. And our ADRs are not going to be the same. And it also tells you about what kind of people you're drawing, if you will. Don't mean to be prejudiced here, but a lower ADR may be telling you that your affluence of your visitors aren't what everybody aspires to. And that's good to know, right, wrong, or indifferent. And maybe it tells you in your own marketplace, hey, my ADR is lower than this company and that company, and this company and that company have generally a better perception than mine. Maybe I need to improve my inventory. What do you think about that?

SPEAKER_00:

Absolutely agree. And I think you need to be looking at your average daily rate this year as compared to last year. Are your ADRs staying sticky? Are you intentionally trying to keep them sticky? You know, there are some other outliers that go into effect. You may have owners that have a non-negotiable ADR. And so that has to play into a factor. But ADR is one of those cornerstones of KPIs. You have to be monitoring. And I would say, I don't know if it's necessarily daily, but we look at these all the time. And especially really knowing your marketplace of when your higher occupancy is, knowing what your ADR should and could be.

SPEAKER_01:

And we do that weekly. And it has helped us in a few occasions where we look at particular weeks and go, wow, our occupancy is way up there, but our ADR is not there. Maybe we missed something here, folks. Let's go back and look at this now. And it has helped us quite a bit over the years.

SPEAKER_00:

And that's a perfect lead-in into the third one that everyone should be looking at, which is the total rev par. So total revenue per available room, and how much can the property perform by combining the price and occupancy into a single metric? Um, so it increases means that strategy is working. Um, and the numbers are based on inventory and location. So for us in our marketplaces, we have, say in Hawaii, we have a lot of condos. So we're gonna have a higher occupancy, a higher turnover, but a lower ADR than maybe our business in California, larger homes, longer stays. We want a higher ADR, a lower occupancy.

SPEAKER_01:

That makes perfect sense to me. I can't see this word ever again without thinking about Court Rousseau and our last podcast and the way he pronounced Revpa. Got a little bit of that Boston accent in there. The Revpa. We didn't even know what that was 10 years ago, and he was so right, but now it is a key for us to look at. Yeah.

SPEAKER_00:

And how often do you check that, Tim?

SPEAKER_01:

I have to say I don't check that quite as much, but I have people that do that. And that leads me to something that's not on the script, which of course I always am good for. And that's who's running these reports. Are you running these reports and just verifying yourself, or are you relying on someone else to tell you it's doing this, that, or the other? Just saying maybe something that on some of these you want to do it yourself and make sure what you're hearing from your staff is what you're seeing with the numbers.

SPEAKER_00:

Absolutely. We settle every week. I have a revenue weekly meeting, and someone who handles our revenue management leads that and goes through all of the reports so we can take really deep dives. I am not the smartest one when it comes to revenue management, but I am able to ask questions and for all of us to dive a little bit deeper. We have our marketing chair, our marketing director on those calls as well, so we can quickly pivot if we need to.

SPEAKER_01:

And the sources for those, your software that is the brandy output, that should have some ability to give that to you. And then I'm just a shill for key data. It gives you the market information, and I've found it to be right spot on most of the time. Do you have other tools you use?

SPEAKER_00:

Yeah, so we absolutely key data is number one, and because they actually pull real data because we give our data. And so, even from a regulatory perspective, it's easier for me to have these conversations because it is real data and we can make really smart decisions for our local area. We also use a lot of beyond metrics. That's our revenue management software that we use. So we're able to go in and it's very easy to display some of our ADR, what we're looking at occupancy-wise. So it'll pull some good reports, but that's along with key data.

SPEAKER_01:

Yeah, Beyond is very good. There's also several others out there that do an excellent job on this. So we're not saying what you have isn't right, but just make sure you use it to its fullest capability and make sure you're tracking that stuff. Which brings me to my third point, or our third point, if you will, of the ones that you absolutely should be doing. And that's dollars booked. You were telling me before we started, your mom did this years ago. I just did our report literally about an hour before we started this podcast of last month's metrics. And I was looking at the Excel spreadsheet that I have. I have the last 15 years of data on there. And so I can see, yes, the arrow is moving up. That's good. But you also want to look at how much growth have I had in the last year? Did you add 10% to your inventory? And if you're 8% up in revenue, well, you want, you're actually down a couple of percentage points year over year. So that's something to look at. But that's the kind of the sanity check, I would say. You can breathe a sigh of relief. Oh, yes, we are doing pretty well. I will be able to pay the electric bill next month.

SPEAKER_00:

Yeah, exactly. You get into the rush of these things, and so you tend to have one or two bad reservations and you think the sky is falling, or you think your staff thinks the sky is falling, or you know, this year we haven't seen, we've seen the booking window compress. And so this gross dollars booked, you know, previous month to previous year is really how you take your finger off the panic button. And I grew up seeing my mom run these reports over and over. So they're kind of our bread and butter.

SPEAKER_01:

The other thing I've added to that is the source of those bookings as well. Traditionally in my markets, we've been a very direct booking area, but third-party OTAs are starting to come on, and you can see the trend as you look back the past 10, 12, 14, whatever many months, that third parties are coming up. So are we positioned properly on the third party platform? So again, that's a report I'd urge you to do yourself. And everybody knows I run that report, and until I hand it out, it's not real. So there you go.

SPEAKER_00:

That's a that's a great one, Tim.

SPEAKER_01:

Okay. So those are the ones we have that if you're not doing all that, maybe step back, hit rewind on the podcast if you missed something, and make sure that you can check those boxes. Now, let's look at some things now that maybe some people ought to be thinking about as they look at the whole breadth of their business. What are some of the other reports that you like?

SPEAKER_00:

Yeah, so we just talked a little bit more about your what brings in your gross rental revenue, but your KPIs also need to look at your expenses. So one of the KPIs that I look at consistently, I or my team, look at consistently, uh, have to do with our maintenance and inspection. So we, and I believe Ben has mentioned this on a previous podcast, but we look at closed service orders per day or labor build in a day. If we're not hitting that labor, then we're consistently going in, meeting with the team to see if we need to adjust what our minimum labor expenses are, how much time we're spending. Do we need to outsource some and create an uh, you know, a percentage add-on for some of these businesses? We do weekly reviews. Usually I have someone who heads up the maintenance or inspection department to do a weekly review. Um, one of the companies that we used to work with, they do a daily review of this. Um, so there really is no wrong answer for what works for your team. And unfortunately, Tim, I mean, for us, there's no real report. We do a combination of Breezeway and our PMS system. And then whoever's running that report usually understands what work orders have been opened and they're the ones closing them. So they can easily put that report together as opposed to just running it through the system.

SPEAKER_01:

Can't believe I forgot payroll as a KPI. Good catch on that one. Yeah, that's one of those things I am never gonna let go of on payroll day. I want to see that pre-process register. I know it's an extra step for HR people, but I want that test. I want to see was our payroll X amount this month? What was it last month? What was it last year? And what I've found in looking at that is we have employees on the roll that are no longer with us. We need to keep up with the stove, folks. You know, a lot of seasonal employees out there, you need to get them off the rolls if they're not on your payroll, because it could cost you down the road in terms of uh payroll taxes, et cetera. Yeah, payroll's huge and it does require oversight all the time.

SPEAKER_00:

And I'll add on to that too. If you start to add a lot of people into your network and into your payroll, we just recently had someone leave our number two in the business, but we're able to promote someone else within, leave a little bit of extra money, and our team is so good that we can disperse some of her responsibilities instead of hiring more people to cover that position. And so making some of those necessary changes is important, but we wouldn't have known that had we not known the percentage of our overall payroll costs.

SPEAKER_01:

It's excellent. One of the things that we do that I don't think I've mentioned on our podcast before is an annual planning retreat where we do take the management team off site. I think you've alluded to this in the past as well, Tiffany. And you can set those goals about where we are going to be next year in every department, which we're gonna get into a little more here in a moment, but also the overall budgeting, making sure it's on track. So when I'm looking at that payroll, I want to make sure it is in line with our budget as well. And we've anticipated those things I just talked about. But I can't urge you enough. This is the time of year for those of us in a beach community to do those off-site planning retreats. Take a day, I know it's tough. Schedules are very difficult to congeal, but it is worth the time to get off-site, put the phones at the door, re-energize, and refocus. So that's part of your KPI, I think, too as well.

SPEAKER_00:

That's a huge one. And making sure that everyone has a little buy-in so they're just as invested in that goal. That's a great one. And off-site is a is a really good tip, Tim.

SPEAKER_01:

Yep. And many times you can find a site at little or no cost. Many of you have large bank accounts. Go to your bank. I'll bet they have a conference room somewhere that they aren't using on a particular day, and they may be willing to give it to you for a low or no price. So and then have a theme as well. This isn't a planning retreat podcast, but when you do it, make sure there's an overall theme that comes from the top down and make sure everybody gets into it. Ours this year is surrounding a book that is not new, but it's called the no complaining rule. I don't know if you ever read that one. It's a great read. It's a quick read too. It's only about 100 pages. So we're going to implement the no complaining rule. Shh, don't tell anybody. I don't know yet.

SPEAKER_00:

Well, I love that. So I'll add that to my Kindle list. And speaking of complaining, that brings us into our next KPI, which we get, it doesn't matter who you are, you'll randomly get someone who has some type of cleaning complaint, and you need to figure out how you have KPIs around housekeeping. And housekeeping is so important because it increases the quality and it also increases and better the performance. So no matter if you have contract cleaners or non-contract cleaners, I know Tim, you have in-house all employees, yes, ma'am. And I have contract cleaners for all of our locations. But feedback in general is very unconstructed. It's very difficult to measure. So it's really important for you to look at work orders and then inspections. So if there are any guest complaints, it's documented. And any inspection deficiencies, those are also notated. And so creating that equation of having those complaints and inspection deficiencies almost as your numerator and their overall cleans as your denominator in creating what that metric is.

SPEAKER_01:

I again am a shill for Reesway, another one of my favorites out there. And they have that whole task system. And we've really been able to up our game in this area where every clean is a task. Every task requires pictures, every task requires a start and end. So those of you that are using piecerate pay methods for your housekeeping staff, you can go back and do a sanity check and say, this cleaner cleaned this house 14 times this year. And on average, they took this amount of time, and we're paying this rate for a piece rate. Does it gel? Are you paying more or are you are you not paying enough for that product? So those are great KPIs to have. And those pictures, gosh, it's worth a thousand words.

SPEAKER_00:

Agreed. And looking into as well what your cleaning costs are. So if you do have contractors really understanding what those cleaning costs are year over year, so looking at that increase and making sure that that also makes sense with what you charge within your fees as well.

SPEAKER_01:

There are additional KPIs. I am of the mind that every department in your company should have some sort of a KPI. This past year, we have a scoreboard. Everyone has a scoreboard. If you walk around my office, there's scoreboards up everywhere. And even our HR department, which you'd say, how do they have a scoreboard? Well, we were able to track it down to three areas. One is an owner-facing KPI, one is a guest-facing KPI, and one is a fellow employee KPI. And so we're able to figure out something that fits in one of those three buckets for every single department. And we can track that on a monthly basis. And I have shown Tiffany uh my spreadsheet before, it's kind of complicated. And there are some green areas and there's some red areas that we're falling a little short on. But even the red areas don't necessarily mean that you're failing. If you are improving over where you were, well, that's a great thing to keep track of. And it's something to celebrate. Even if you don't hit the measurement which you in your planning retreat said you were going to do, and we're all fired up and we're going to do this next year. But some improvement over where you were last year, that's a great KPI.

SPEAKER_00:

When you showed me that spreadsheet, it reminded me of going to those conferences where you sit in a session and you think, am I doing this all wrong? I'm so behind. That spreadsheet is beautiful. And I feel like if anyone sees Tim out on the street, you need to ask for what this thing looks like. It is, yeah, I told Ben immediately we had to we had to get some type of spreadsheet together. But ours is not quite as elaborate. And we don't have them in every room. But I do think it's important, like you said, to have every department have buy-in. So when you do have those strategic planning meetings, make sure that they're bringing something to the table and something they know that they can measure themselves against or their team against. On a little fan favorite, my one of my absolute favorite KPIs that I feel like is underviewed is overtime management. We hit really high peak seasons. And if you're not actively managing your overtime, it can quickly become one of your heaviest and highest expenses, especially depending on how you structure your on calls. If people decide that they want to take some work home and they add it on and no one's watching, if someone comes out and they're buffering time, it's just something you're gonna have to continue to manage.

SPEAKER_01:

For me, overtime is a red flag in that this person either is not managing their time properly, or we are putting more on them than we should be, and we should hire someone else. And that's the question I always say to myself is this a management issue or is it a management issue that we're putting, you know, the person says, Give me more, give me more. And then all of a sudden you see they had eight hours of overtime in the last week. How did that happen? So overtime management, that's a that's a great one.

SPEAKER_00:

One of the other ones that I have in terms of marketing, if you do anything on Google in advertisement, which we do a lot of Google Analytics on the platform has a really great review. So you can see all the analytics and the KPIs as it relates to your click-through rate, your conversion rate, your cost per click. We look at that weekly, analyze it. But one of the other things that we have started looking at from a marketing perspective is our feeder markets. So we've seen an increase in other areas that we're not typically marketing to. And so now we're going in and we're targeting those areas and doing some geo-targeting there. The other thing that we're looking at is in terms of our repeat areas or where we're spending all of our money in our advertisement, are those continuing? So it either can be a feeder market by location, feeder market by where your guest is finding you from. But that's something we try to keep a really strong pulse on.

SPEAKER_01:

Yeah, the marketing one, it feels sometimes like you just you throw it against the wall. And if it sticks, great, you know. But you really need to have a more scientific approach. Uh, that return on investment in Google Analytics is it. That's really when you can tell I'm spending money here and it actually does have a return. I've accused my marketing guy sometimes of being like ah behind the curtain. There's nothing to see here. There's nothing to see here. Just trust me, it's gonna work. But it does give you a warm feeling when you see that hey, we did actually have 15 bookings from this effort here, and you you do need to test that. So make sure you know what's going on and you can test it, and that you can have a conversion rate that you can go back to and say, Yeah, let's do some more of that, or let's not do that ever again. I've got another one that's sort of an unusual KPI that has worked in our favor with the laundry aspect of our houses and the preparing of the pack outs. We actually have engaged our housekeeping staff to let us know when they get to a property and they're missing a hand towel, they're missing a king size sheet, they're missing whatever. And it goes back to our laundry to say, hey, we had this miss. And that's something we kept track of to the point that this past year, I'm looking at a statistic now where we did something like 4,800 laundry bags, and we had five misses out of that. But that only came about because we committed to the process and we got that feedback for the front line, and we found out that the software program that we've had in place for years didn't get updated. The owner changed the bed from a queen to a king, and nobody told the laundry department, and so they've been doing the bad pack out for a year, and the cleaner just accepts it, and they went and get a king-sized sheet from the shelf every week. And you're like, Why are you getting a king-sized sheet every week? Those kind of things really irk me because it can be solved. And that was a KPI that really made me proud. That we handled all those bags of laundry and only a few are so 99.9 something percent. That's pretty dang good.

SPEAKER_00:

That's very good. Very good. I've had to work in the laundry before, so I know how uh it it you can handle and mishandle getting all of those those bundles together.

SPEAKER_01:

Before I leave that one other one, I just thought of is related to the growth of your company. Did you meet the goals that you have in mind for this year when you were sitting back in January? Did you have a goal of adding this many properties? And then how did that work out? And then analyze why didn't they like me? You know, what was it? Are we not delivering the message properly? Are we looking in the wrong places? How did the not meet the goal we had as a key performance indicator? Is how many properties you manage? Everybody knows the number off the top of their head. A lot of times it changes day to day, but you know the number and you know what number you want to be at. Why aren't you there? Another one I have.

SPEAKER_00:

That is exactly the one that I was gonna say is really looking at the net. We just took off a couple properties in one location because we had to get rid of some of the owners and they weren't meeting the standards that we had. So unfortunately, it dropped our business development director's number down. But really, in terms of the net, we're happy with that number. And by the end of the year, I think we will be fine. But understanding what that net number is, did you meet it? And if you didn't specifically why, was it your choice or was it because of behaviors and actions of your team?

SPEAKER_01:

I love that. And that's a I can't believe I didn't remember that before. Each year, always interview staff. Who are the owners you hate to get the call from? No, and they're on a list. And so is it a failure on us for not going back to that owner and say, hey, we had this as a goal for you this year, and you reached this amount, but you didn't reach that amount. And so we need to talk that through because the owners have key performance indicators as well. Mostly it's number of bookings, but income is there as well. And maybe they're fat and happy and they've reached that income level and it doesn't match you anymore. Are you giving them that feedback that, you know, for you to stay in our program, we really need you to be at this level? And so that's a key indicator you need to give them feedback on to ensure that you're aligned and you have a great partnership.

SPEAKER_00:

I think those are all the best key. Well, I shouldn't say they're all the best key KPIs, but those are some of our absolute favorites. And again, the ones that you, if you're not looking at, you should be looking at and meeting together. But now's a perfect time of the year for you guys to get together with anyone else on your team and start really researching what do you want your KPIs to look like in 2026?

SPEAKER_01:

So we will get into that and we hope you've taken some things that you can use as a key to build your company even better than what it is.

SPEAKER_00:

We're here to help you make a lot more money.

SPEAKER_01:

So that'll do it for now. We'll look forward to talking to you next time.

SPEAKER_00:

And if you have any other KPIs that you don't think have made the list but need to, please reach out and let us know. We'd love to hear them and maybe bring back this episode and share some other great KPIs.

SPEAKER_01:

We appreciate a five-star review too on the app that you're listening to right now. Always helps us reach more people and do our job better. So until then. So long, everybody.

SPEAKER_00:

Bye, everyone.

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Tiffany Edwards

Host
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Tim Cafferty

Host