Revenue Management Glossary

Lead Time

Definition

Lead Time in hospitality refers to the number of days between when a reservation is made and the guest’s actual arrival date. It reflects how far in advance bookings are secured and plays a key role in forecasting, pricing, and revenue strategies.

How to use it

Revenue managers monitor Lead Time to: Forecast booking pace and set pricing strategies accordingly, understand consumer behavior (e.g. short-lead vs. long-lead bookers), identify booking windows for different segments (e.g. business vs. leisure) or to apply restrictions like minimum lead times for specific offers or rate types.

Formula

Lead Time = Date of Arrival – Date of Reservation

Related Terms

Booking Window, Forecasting, Pace Report, Pickup, Dynamic Pricing
“Lead time tells you when your guests commit—use it to forecast smarter, price better, and fill rooms at the right time.”

Sarah Kock

Sarah Kock
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