What is the meaning / definition of in the industry?

The term refers to demand being severely restricted in activity. It is used in the industry – in management – when referring to demand forecasts.

To understand you must first understand unconstrained demand. Unconstrained demand is your total demand for a particular date irrespective of your capacity. Hotels should identify when unconstrained demand is above the capacity of the hotel. This is an important part of your reverevenue management strategy.

Constrained demand, is the demand you get when adapting factors such as price. By increases in price, you are changing the demand, in a way constraining it, thereby allowing less customers to book your hotel.

The concept of “Unconstrained Demand” is sometimes applied when a limit of a resource ( size) reduces the potential from e.g. earning potential of the hotel restaurant.

See also:

  • Unconstrained demand


  • Restricted Demand


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