What cost per stay measures, and what it is not
Cost per stay is the total cost of serving a property in a period, divided by the number of stays in that period. It answers one question: what does it cost us, all in, every time a booking happens? That is the question a minimum stay, a cleaning charge and a decision to keep or hand back a property all turn on.
It is not cost per night, which flatters short-stay properties by spreading a fixed turnover across the nights it happened to sell. It is not cost per turnover either, although a turnover is usually the largest single component. A turnover cost is a supplier question. A cost per stay is a business question, because it includes the parts of serving a booking that never reach an invoice. What a turnover really costs.
Compute both a marginal figure and a loaded one. The marginal figure holds only the costs that would not have been incurred had the booking not happened, and it is the one to use when deciding whether to accept a gap-filling night. The loaded figure adds the property’s standing monthly costs, spread across the stays the month produced, and it is the one to use when deciding whether the property belongs in the portfolio at all.
Building the number
Work down this list for one property, for one month, and divide by the number of stays rather than the number of nights.
- The turnover itself: the clean, any same-day premium, and the linen that went with it.
- Consumables replaced for that stay, split out of any bulk order at the point of capture.
- Coordination time: confirming the cleaner, guest messages, access, the call about the shower. Priced at what the person doing it costs.
- Per-booking charges: payment and channel fees that land per reservation rather than per night.
- The wear allowance: a standing monthly figure for the things guests slowly use up, rather than a spike in the month the sofa goes.
- For the loaded figure only: the property’s standing monthly costs, divided by the stays that month produced.
Two disciplines make the number trustworthy. Capture costs against the stay that caused them rather than only against the property, so a month with nine stays and a month with three can be told apart. And measure a busy month rather than a quiet one, because back-to-back changeovers and panic restocks are where the real cost lives. Costs against the property and the stay.
Why property shape and stay length change it
Two numbers drive almost all of the variation, and neither of them is the rate.
The shape of the property
Bedrooms set the clean time and the linen volume, roughly in step. Access sets the coordination: a lockbox and a local cleaner cost a fraction of a key handover and a cleaner forty minutes away. Stairs, parking, a garden, a hot tub and an on-site laundry each move the figure again, and none of them appear in the listing description as costs.
The turnover pattern
Average stay length is the multiplier. A studio selling eleven two-night stays runs eleven turnovers to fill twenty-four nights. A house selling four week-long stays runs four to fill twenty-five. The house costs far more per stay and far less per night, and the second figure is the one that reaches the bank.
A worked example
Three property shapes, one month each, costs measured on the loaded basis. Read the last column rather than the one before it.
| Property | Stays and nights | Cost for the month | Cost per stay | Revenue per stay | Cost as a share |
|---|---|---|---|---|---|
| Studio, city centre | 11 stays, 24 nights | £913.00 | £83.00 | £150.00 | 55% |
| Two-bed flat | 6 stays, 22 nights | £645.60 | £107.60 | £600.00 | 18% |
| Four-bed house | 4 stays, 25 nights | £1,024.00 | £256.00 | £1,375.00 | 19% |
The studio has the cheapest turnovers in the portfolio and the worst economics in it. At an average stay of 2.2 nights it runs nearly twice the changeovers of the flat to sell two more nights, and over half of what a booking earns is spent serving it. The house costs three times as much per stay and keeps four fifths of the revenue, because a 6.3 night average spreads one turnover a very long way.
Spotting the door that eats the margin
A property destroying margin rarely announces itself, because it is usually busy. High occupancy, a full calendar and a cleaner who never complains all read as success. Four signals together are the giveaway.
- Cost per stay is a large share of revenue per stay. Once it approaches half, most of what a booking earns is going out again before anything else is paid.
- Average stay length is falling while bookings rise. More stays for the same nights is more cost for the same revenue.
- The cleaning charge to the guest has not moved in two years while the cleaner’s price has.
- Coordination time is concentrated: one property generating a disproportionate share of the messages and the call-outs.
The response depends on which signal fired. A short average stay is a minimum-stay problem. A cleaning charge that no longer covers the work is a pricing problem you can fix in an afternoon. Concentrated coordination is usually a fixable access or supplier problem rather than a reason to hand the property back. Only when all four hold, and none of them move, is the honest answer that this door is not worth the desk space.
What to change, in order
- Set the cleaning charge from the measured turnover cost, not from what the cleaner invoices. Labour without linen, consumables and wear is a discount you did not mean to give.
- Set a minimum stay from the marginal figure, not the loaded one. A one-night booking has to clear the cost the booking itself causes, which is the clean, the linen, the consumables and the coordination behind them, before it has earned anything at all. The standing costs inside the loaded figure are being paid whether or not that night sells, so holding a gap night to the loaded number turns away work that was worth taking.
- Fix access and supply before touching the rate. A lockbox, a nearer cleaner or a linen service can move cost per stay further than a price rise will.
- Re-price the property only once the cost side has been dealt with, so you know what the rate has to cover.
- Renegotiate or exit last, with the figures in front of you rather than the feeling that this one is hard work.
Change one thing and give it a full month with a comparable pattern of stays before reading the number again. Three changes in three weeks leaves you unable to say which of them worked.
Measuring it properly
Cost per stay, one property, one month
- Costs captured against the stay that caused them, not only against the property.
- Bulk purchases split at capture, across the properties and months they cover.
- Coordination minutes recorded as they happen, priced at what the person costs.
- Per-booking payment and channel charges included, not only per-night ones.
- A standing wear allowance logged every month, not only when something breaks.
- A marginal figure and a loaded figure both produced, and labelled which is which.
- Divided by stays, never by nights or by turnovers, whichever is larger.
- A busy month chosen, and the same month type used for every comparison.
- Set against revenue per stay before any conclusion is drawn.
Common questions
- Should I divide by stays or by nights?
- By stays, because most of the cost is triggered by the changeover rather than by the night. Cost per night is a useful second figure once you have the first, since it is what a rate has to cover, but it hides the whole problem with a short-stay property.
- What is a good cost per stay?
- There is no figure worth quoting, because it depends on bedroom count, access, laundry, local labour rates and average stay length. The answerable version is the share: what proportion of revenue per stay is spent serving it, and whether that proportion is moving in the right direction for that property.
- Should the owner’s cleaning charge be netted off?
- Keep them on separate lines rather than netting. The cost of serving a stay and the charge you make for it are two decisions, and netting them hides the moment the charge stops covering the work. Compare them, deliberately, once a quarter.
- How often should this be re-measured?
- Once a year for every property, and immediately after any change to the cleaner, the linen arrangement or the access method. Those three move the figure more than anything else, and a cost measured before a supplier change is a cost you are guessing at.
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Figures in the worked examples are illustrative — they show the method, not a going rate. This guide is general information, not professional advice.