Which is a valid rule regarding the creation of a competitive set?

The correct answer is based on a core principle of creating a competitive set for analyzing hotel performance. In the context of competitive sets, the goal is to compare a hotel to a relevant group of similar properties to gauge performance accurately. Excluding the subject hotel’s own room count from percentage calculations allows for a more focused analysis on how the hotel performs relative to its competitors. This approach ensures that the performance metrics reflect the competitive landscape without any bias introduced by the subject property itself.

By excluding the subject hotel from the total room supply, it creates a clearer picture of how its metrics compare against those of the selected competitive hotels. This practice ensures that the analysis and benchmarking against the competitive set are fair and relevant. It is important for this process that the analysis only reflects the performance of competing hotels, thereby emphasizing the performance gaps or advantages of the subject hotel in the market.

In the context of competitive sets, while it might not be explicitly stated in other options, the fundamentals of competition dictate that fairness in comparison is necessary for insightful benchmarking.