Hotel Revenue Management With Group Discount Room Rates

Zvi Schwartz, Eli Cohen

Research output: Contribution to journalArticlepeer-review

15 Scopus citations


The question of how large a discount a hotel can offer to a group while still maintaining its contribution margin cannot be addressed by the well-known discount grid model for hotel room rates. This article outlines a theoretical framework and suggests a set of equations for use by hotel executives to evaluate the discount rate the hotel offers to groups wishing to stay in the hotel. The model addresses numerous realistic factors such as sold-out situations, multiple market segments (room rates), reserved room blocks, type of group contract, group no-shows, overbooking, and income from other group (and group guest) activities.

Original languageEnglish
Pages (from-to)24-47
Number of pages24
JournalJournal of Hospitality and Tourism Research
Issue number1
StatePublished - 1 Jan 2003


  • discount grid
  • group discount
  • hotel management accounting
  • revenue management
  • room rates
  • yield management

ASJC Scopus subject areas

  • Education
  • Tourism, Leisure and Hospitality Management


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