Occupancy = Rooms Sold ÷ Rooms Available × 100
Occupancy is the percentage of available rooms that were sold. Occupancy = Rooms Sold ÷ Rooms Available × 100.
It signals demand at the prices you charged. 95% occupancy usually means you priced too low; 40% occupancy means demand was weak or your rate was uncompetitive.
The classic mistake is treating occupancy as a goal. 100% occupancy is rarely optimal — it usually means you under-priced peak demand. The right target depends on segment, season, and compset.