Room Prices - How much should you charge? 

You need to let rooms and make a profit.

When you let rooms you do it to make a profit. By now you know how much it costs to provide accommodation for the night - for a refresher see our What is your Break Even Point page.

Once you have set a reasonable room rate you can quickly average your earnings for the year based on known or predicted occupancy rates.

Remember though that at the moment we have just an average rate for the whole year. It doesn't mean you have to charge that rate.

Firstly, what do your nearest competitors charge. If they are all charging £50 and you need to charge £75 then something is likely to be wrong in your calculation.

Then have a look at your trade during the year. Are there periods where you are always full or periods when there are local events that attract visitors. Anything which means all beds will be sold can attract a premium rate.

You also need to consider weekly fluctuations. If you are always at low occupancy on Tuesdays, Wednesdays and Thursdays consider a mid week price reduction. Next time those visitors may be back at high season.

In today's climate many people will try to negotiate lower prices. Make sure you have a minimum price per room set and make sure you don't go below that figure. You should also consider refusing to negotiate deals over your peak periods.

Remember never to go below your break even point. If you do you may as well give the rooms away for free. Being the cheapest is fine but you need to make a profit every time you let a room.