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Revenue Management Glossary

Perishable Inventory

Definition

Perishable Inventory refers to inventory that cannot be stored or saved for future use; it must be consumed or sold within a specific timeframe. In the hotel industry, this refers primarily to room nights. Once a night has passed, any unsold room is lost revenue—there’s no way to “stockpile” or “re-sell” that inventory for a future date.

How to use it

Because unsold rooms cannot be stored and sold later, revenue managers must use dynamic pricing and stay controls to sell as many rooms as possible before they expire each night.

Formula

There is no direct formula for perishable inventory, but it can be reflected in metrics like: Perishable Inventory Loss = Unsold Room Nights (for a given date) = Total Available Room Nights – Booked Room Nights

Related Terms

RevPAR (Revenue per Available Room), Dynamic Pricing, Occupancy ForecastRevenue Optimization, Room Night, Last-Minute Pricing
“Perishable inventory reminds us that each unbooked room is a missed opportunity—use time-sensitive pricing strategies to sell every room at its maximum value.”

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