Please note : This article does not describe how to use occupancy features in any of our products. It is a general explanation of how occupancy can work in a variety of systems, comprising our products and systems that our product can connect to, but not exclusively.

Occupancy is the amount of guests staying in a room, sometimes directly referred to as "occupants".

Channels, PMSs and other softwares will require hoteliers to indicate what the Maximum Occupancy of their room is.
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Maximum Occupancy is the maximum amount of guests that can stay in a room.
For example, if a room has a single bed and a double bed, then the maximum amount of people that can stay in the room is 3, and so 3 is the Maximum Occupancy of the room.

Most softwares divide the occupancy between Adults and Children, so a hotelier might be asked to also indicate the Maximum Adults and Maximum Children that can be in a room. Occasionally there will even be an option for Infants (usually based on whether the room can have a cot)

Hoteliers can operate with one of the two pricing models described below:

Per Room Pricing
If a room is sold at the same price regardless of how many people are accommodated in it (within its maximum occupancy), then the hotelier is operating using a simple Per Room Pricing. This is the most straightforward and simple way to set up the pricing. There might be one person or many people in a hotel's room, but the price remains the same.

Occupancy Based Pricing
If a room is sold at a different price depending on how many people are accommodated in it, then the hotelier is using a model of Occupancy Based Pricing. Because this is a more complex setup, there are many ways to do it and different channels, PMSs, softwares and connections might handle it in different ways.

This is a less optimal way to change the pricing based on occupancy that might be necessary if the channel, PMS or other software being used doesn't have any feature to facilitate selling the room at a different rate depending how many occupants are in it.

Most softwares allow to sell the same room with different rate plans, offers or "room rates" (the names for this concept are varied), so that the same room can be sold at a different price depending on different conditions. Classic examples are breakfast and/or dinner being included/excluded in the price, or whether the booking is refundable or non-refundable.
When setting up occupancy based pricing using separate rate plans, a hotelier creates a different offer or plan for each configuration of occupants that can book a room. This has the potential to get very complicated.

For example, if a room can handle a maximum of 3 occupants, a hotelier that wants to cover all ways to sell the room creates a separate offer or plan with a different price for each of these conditions:

This causes the creation of 6 different offers for each of the ways the room is sold, which will allow the hotelier to control the price per occupant, but also make it more difficult to properly control the price.

Many channels, PMSs or other softwares will have options to increase the price depending on the occupants using the same fixed price increase regardless of what day is being booked.

Usually in this case the hotelier will be asked to tell the system what is the I ncluded Occupancy of a room, which is the amount of guests that are included with the base price, then the hotelier will also need to indicate how much more a rate costs if one more adult or child is added to the room. This is often called Extra Adult Rate or Extra Child Rate.
Included Occupancy is often called "Minimum Occupancy" although this term is less precise, because it is usually possible to book for an amount of guests that is smaller than the Included Occupancy, so it's not really a "minimum" at which a room is booked.

If the room has space for more than one person, the Included Occupancy is usually set to 2. Because of this common way to set up the rates, some systems and connections add the option to give a discount if a room is booked by only one guest, often called Single Guest Discount.
Sometimes, softwares provide options to have these extra prices and discounts set as percentages, rather than fixed amounts of money, but it is more rare.

For example if a room can handle a maximum of 4 occupants, a hotelier that wants to sell the room with different prices depending on the occupants could set it up this way:

Or a more common way to set it up, although slightly less flexible would be:

In some cases channels, PMSs or other softwares will provide hoteliers with the option to directly set the price differently on every day of the inventory calendar depending on the amount of occupants booking a room.

When this is the case, after the hotelier provides Included Occupancy and Maximum Occupancy for a room, the system will simply allow to set a different price every day for each of the possible amounts of occupants, without the need to create separate offers.
Basically this type of system does away with the concept of a "base price" and every price is set individually.

For example, if a room can handle a maximum of 4 occupants, and the hotelier has set Included Occupancy to 2 and Maximum Occupancy to 4, the hotelier can set the price for 2 occupants, 3 occupants and 4 occupants at varying prices every day.