Revenue Management Glossary

Historic Method Forecast

Definition

The Historic Method Forecast is a basic forecasting technique that uses historical room night (RN) data from previous years to estimate future demand. It provides a straightforward average of past performance, helping hoteliers establish a baseline forecast when other detailed data may not be available.

How to use it

Revenue managers apply the Historic Method Forecast when: A simple, reliable baseline forecast is needed, there is limited pickup or pace data for future dates, or establishing trends across comparable time periods (e.g., holidays, seasons).

Formula

FC (Historic) = (RN₍Y₋₁₎ + RN₍Y₋₂₎ + RN₍Y₋₃₎) / n. Example: If you had 100 Room Nights in 2022, 120 Room Nights in 2023, and 110 Room Nights in 2024: FC (2025) = (100 + 120 + 110) / 3 = 110 RN

Related Terms

Forecasting, Booking Curve Forecast, Combined Method Forecast, Year-over-Year (YoY), Baseline Forecast
“The Historic Method Forecast gives hoteliers a dependable starting point—grounded in past performance—for future demand planning.”

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