For hotels, which normalization approach better facilitates comparison of water consumption across properties with different occupancy levels?

• A. Normalize by occupancy rate (multiply)
• B. Normalize by inventory of rooms (divide)
• C. Normalize by geographic region
• D. Normalize by revenue

Answer: (A)

The main idea is to tie water use to the actual activity driving it: occupancy. Hotels vary in how many guests they serve, and water demand grows with occupancy. By normalizing water consumption with occupancy, you convert total use into a rate that reflects water used per guest or per occupied room, allowing apples-to-apples comparisons across properties with different busy levels. This approach isolates water intensity from sheer size or revenue, showing which properties are more or less efficient at using water for the same level of service.

Normalizing by inventory of rooms (dividing by capacity) can mislead when occupancy varies, because a larger hotel with low occupancy may appear more efficient than a smaller, busier one. Normalizing by geographic region doesn’t account for how much water is actually used to serve guests. Normalizing by revenue mixes financial performance with water use, which can distort efficiency when pricing or occupancy drive revenue independently of water intensity.

So, adjusting for occupancy provides a true basis for comparing water performance across hotels operating at different occupancy levels.