Running a hotel in Italy costs, between fixed and variable expenses, 70-80% of revenue: a 30-room four-star hotel that takes €1 million a year spends roughly €750,000 to keep operating. The heaviest item is staff, at 30-40% of revenue, followed by utilities, OTA commissions, laundry and maintenance.
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The cost structure: the full picture
Before looking at individual items, it helps to see the whole picture. A hotel’s costs fall into three families: variable costs, which rise with the number of rooms sold (laundry, cleaning, breakfast, commissions); fixed operating costs, which run even with an empty hotel (permanent staff, base utilities, insurance, scheduled maintenance); and structural costs, meaning rent or the mortgage on the property, which alone can move the bottom line more than any other item.
The table below summarises the typical incidence on revenue for a 3-4 star Italian hotel under annual management, average 2026 industry figures:
| Cost item | Share of revenue | Example on €1,000,000 |
|---|---|---|
| Staff | 30-40% | €350,000 |
| Rent or property cost | 10-20% | €150,000 |
| Utilities and energy | 6-10% | €80,000 |
| OTA commissions and marketing | 8-12% | €100,000 |
| Outsourced laundry and cleaning | 4-6% | €50,000 |
| Food & beverage (raw materials) | 5-8% | €60,000 |
| Routine maintenance | 2-4% | €30,000 |
| Insurance, licences, software | 2-3% | €25,000 |
| Other costs (amenities, consumables) | 2-3% | €25,000 |
| Total costs | 70-80% | €770,000 |
What’s left, 20-30%, is the gross operating margin before tax and depreciation. How much of that margin becomes actual income is a separate question: how much a hotel owner earns depends on debt, depreciation and taxes, not just on the operating result.
Staff: the item that decides the bottom line
No item weighs as heavily as labour. A 30-room four-star hotel running year-round typically employs 12-18 people across reception, housekeeping, breakfast, maintenance and management; with the average total employment cost in the sector running €28,000-40,000 a year per employee, the bill quickly climbs past €300,000.
Efficiency is won through organisation more than through cuts. Housekeeping is the classic example: knowing how many rooms a housekeeper cleans per shift, on average 12-16 for a stay-over service and 8-10 for a departure clean, makes it possible to size teams to actual check-out flows instead of rigid shifts. The other structural levers: cross-training staff across compatible roles, selective outsourcing at peak times, and technology that takes repetitive work off reception (self check-in, digital keys), freeing up time for the guest.
Utilities and energy: the most volatile item
After the years of soaring energy prices, the share taken by electricity, gas and water has settled at 6-10% of revenue, but it remains the item most exposed to shocks. Per occupied room, energy averages €8-14 a day, with air conditioning as the main driver.
The interventions with the fastest payback: relays or key cards that cut power to an empty room, full LED lighting (cutting lighting consumption by 60-80% compared with halogen), sensors in common areas, and proper maintenance of chillers and boilers. Over longer horizons, solar panels and heat pumps are becoming the standard in renovations.
OTA commissions and sales costs
Online travel agencies keep on average 15-20% of the value of bookings made through them. With an OTA share of 50-60% of sales, typical of many independent Italian properties, the commission cost translates into 8-12% of total revenue: on €1 million, around €100,000 a year.
The way to reduce it isn’t leaving the portals, which remain an essential shop window, but shifting share to the direct channel: a fast website with a booking engine, slightly better rates for guests who book directly, and loyalty among repeat guests. Every 10 points of sales shifted to the direct channel are worth roughly €15,000-20,000 in recovered margin in the €1 million example.
Laundry, cleaning and consumables
Linen is a cost per room sold: industrial laundry rental costs on average €4-7 per room per day for the full bed and bath set, which adds up to €30,000-50,000 a year for a well-occupied 30-room hotel. Outsourced cleaning, where not covered by in-house staff, runs €5-8 per room for a stay-over clean and €12-18 for a departure clean. Amenities and consumables add €1-3 per room depending on the category.
Here, the smart savings come from standardisation: refillable dispensers instead of single-use bottles (where the category allows it), linen at the right weight that withstands more wash cycles, and towel-reuse protocols for longer stays.
Maintenance: where the right furnishings save money
Routine maintenance absorbs 2-4% of revenue, but it’s the item where choices made at the furnishing stage pay off for years. Contract furniture built for intensive use avoids the recurring call-outs that eat into this budget: doors that come unglued, runners that fail, surfaces that scratch at the first trolley pass.
Three design choices that cut running costs:
Scratch-resistant furniture finishes matter most on worktops, desks and luggage-rack panels, the three points where the trolley strikes every single day of the year: a finish that holds up reduces touch-ups and extends the furniture’s life between one refurbishment and the next. Then there’s contract hardware. Hinges and runners tested for tens of thousands of cycles, with soft-close dampers that prevent slamming, cost a few euros more per piece and halve the maintenance technician’s call-outs, which in a forty-room hotel means quite a few mornings of work saved every season. The third choice is made further upstream, when deciding who will produce the furniture: being able to reorder spare parts and finishes for the same furniture even eight or ten years later means replacing a scratched door instead of redoing the whole room.
Upstream of all this, an ongoing furniture maintenance programme with seasonal checks on hardware, upholstery and surfaces catches problems while they still cost tens of euros, not hundreds. That’s one of the reasons why, as a contract partner with a supply chain of selected Italian workshops and a single point of contact, we design projects with ten years of use in mind, not just the day of delivery: running costs are largely decided at the moment of purchase.
Cutting costs without cutting quality
The golden rule: cut what the guest doesn’t see, never what they touch. In summary, the actions with the best ratio between savings and risk:
- Shift a share of sales to the direct channel (up to 2-3 points of revenue recovered).
- Automate in-room energy use and switch to full LED lighting (1-2 points).
- Size housekeeping shifts to actual arrival and departure flows.
- Choose contract furniture and finishes that reduce maintenance and replacements.
- Renegotiate laundry, utilities and insurance contracts every year: the supplier market moves.
- Track the numbers with a monthly profit-and-loss statement by department, benchmarked against the category figures described in the guide on how much a four-star hotel earns.
The opposite warning sign is the cut that shows: a poorer breakfast, tired linen, rooms ageing with no renovation plan. Immediate savings get paid back in reviews, and reviews get paid back in rate: the spiral ends up costing far more than the costs it was meant to avoid.
Frequently asked questions
How much does staff account for in a hotel’s costs?
It’s the top cost item: between 30% and 40% of revenue in a full-service Italian hotel. A 30-room four-star hotel typically employs 12-18 people across reception, housekeeping, breakfast and management. The share drops below 30% only in properties with reduced services or well-managed strong seasonality.
How much do laundry and cleaning cost?
Rented linen with industrial washing costs on average €4-7 per room sold for the complete set; outsourced cleaning runs €5-8 per room for a stay-over clean and €12-18 for a departure clean. Together they account for 4-6% of revenue. Correctly weighted linen and towel-reuse protocols cut the bill with no impact on the guest.
How can costs be cut without cutting quality?
By acting on what the guest doesn’t see: more direct sales to reduce commissions, in-room energy automation, housekeeping shifts sized to real flows, and contract furniture with durable finishes and hardware that cut maintenance. Visible cuts to breakfast, linen and room condition should be avoided: they cost more in reviews than they save.
What’s a typical hotel’s margin after costs?
Once all running costs are deducted, the gross operating margin of a well-run Italian hotel sits between 20% and 30% of revenue, before depreciation and tax. Owner-occupied properties, with no rent to pay, can exceed these levels; those with heavy lease payments can fall below 15%.
