OTA commissions (Booking.com, Expedia) usually sit somewhere around 15–20%, and they are not just a “cost of sale”: they raise your break-even and eat into your net margin. Gross revenue fools you — what counts is what is left after the commission.
Gross revenue fools you
You see an €86 booking, and in your head it becomes “€86 of revenue”. But if it came through an OTA at 18% commission, €15.48 leaves before it ever reaches the till. Your real revenue is €70.52 — and from that you still have to take off your CPOR, what it costs you to run the room. Two hotels with the same turnover can have very different profits, depending on how much of that turnover came through channels that charge commission.
How commission raises the break-even
Every room sold through an OTA leaves less behind — so you need more rooms to cover the same fixed costs. Look at the same booking, direct and through an OTA:
Through an OTA at 18%: net €70.52 − CPOR €14 = €56.52 contribution
Difference per room: €15.48 less → more rooms for the same break-even
(Direct is not free either: the discount, the booking engine and card fees take their share. That is a calculation of its own.)
Did you know? WisDom RM has no commission field and does not assume a percentage — that would be an invented number. The contribution it shows you is explicitly before commission. Only you know the net, because only you know where each booking came from.
Try it free for 14 days →When an OTA booking pays
The rule is simple: as long as the net rate (after commission) stays above your CPOR, the booking contributes — it is better than an empty room. Once it falls below CPOR, every such booking costs you more than it brings in.
- Net rate > CPOR: the booking helps — the channel brought revenue you might not have had.
- Net rate ≈ CPOR: marginal — worth it only if you have no other demand for that date.
- Net rate < CPOR: you lose — this is where you start thinking about direct bookings or a higher rate on that channel.
Net, not gross — inside your P&L
An honest clarification is needed here. WisDom RM calculates GOP and GOPPAR from the revenue of the nights you record and your cost categories — but it has no field for OTA commissions, and on purpose it does not assume a percentage. An “18%, estimated” would be an invented number dressed up as statistics, and numbers like that do not belong in decisions.
In practice this means the contribution you see — ADR minus CPOR — is before commission. Your channel mix is known to you, not to the app. Do the calculation on this page once with your own percentages, and you will know how much to take off every figure you see.
Conclusion
OTAs are a valuable channel — as long as you know what they cost. Always measure the net rate after commission, keep it above your CPOR, and read your profitability from GOP, not from turnover. That way commission becomes a conscious choice of channel — not a leak you discover at the end of the month.
Mathematician with studies in hospitality management and years of night shifts in hotels. WisDom RM — and this blog — were born on the night shift.
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