So, you’ve made that booking for a large party in your restaurant. Great! Now it’s time to make the preparations that will ensure they have a night to remember at your establishment. You set the table, polish the glasses and get ready to welcome your customers. The reservation time arrives, the minutes tick by and eventually, you realise you’ve just become the victim of the restaurant no-show.
How No-Shows Impact Business
According to research, an average of 20% of diners fail to turn up for restaurant bookings in major cities like London and New York. This can have a huge impact on a business. Studies have also shown that these no-shows cost UK businesses £16bn in lost revenue each year.
When guests don’t show up for their reservation, it can negatively affect a business on a number of levels. Almost all of these levels involve revenue in some way. Firstly, there is the fact that a large table has gone to waste when you could have given it to another large group or split the tables to accommodate smaller parties. Next, there are the costs of preparing food that will not be eaten and scheduling too many staff to work the evening. All in all, restaurant no-shows can be as expensive as they are frustrating. The good news is that there are ways to avoid them altogether or at the very least reduce the impact they have on your business.
Why Does It Happen?
The number of no-shows can depend on a range of different factors. If there is a high concentration of restaurants in a particular area, customers may change their mind on a whim and visit a competitor’s establishment. A casual attitude can also play a large factor; consumers have never had it so easy when it comes to booking online or simply walking into a restaurant to get a table. As if that wasn’t bad enough, many consumers routinely book multiple venues so that they can make a last-minute decision on the night depending on their mood or plans.
What Can You Do To Reduce No-Shows?
There are a number of ways you can reduce no-shows at your restaurant. Some owners take a very dim view of diners who don’t arrive to claim their table and have implemented some heavy-handed tactics to deter diners from bailing out at the last moment with not so much as a phone call.
From charging a fee for no-shows to sending friendly reminders, here are just some of the ways you can ensure customers honour their bookings:
Everything in Writing
A reservation in writing may not be legally binding, but an email with clear reservation information included can make all the difference. You may also want to consider an online reservation system to handle your bookings. These can be integrated easily onto your website and will automatically send a confirmation email when a booking is made.
Send a Reminder
Sending an SMS message 24 hours and a few hours before the customer’s booking is due serves not only as a reminder of their booking, but will also prompt them to cancel or reschedule if their plans have changed. Many bookings are made well in advance, and a brief reminder can work wonders for your no-show rate.
Make it Easier to Cancel
In this digital age, we all want to do things at a touch of a button. Being put on hold or listening to a ringing phone can be very frustrating, and especially if we are calling out of courtesy to cancel a booking. Make it easier for your patrons by allowing them to cancel online, send a cancellation text or set up a dedicated cancellation hotline or answering machine.
Consider Reservation Windows
Many establishments have a reservation window of around 15 minutes. If customers do not arrive within this time they can be declared a no-show. If they call to say they will be late this window can be extended further.
Charge Their Credit Card
Some restaurants, especially high-end establishments request credit card numbers of deposits before they will take a booking. If they experience a no-show but are able to seat another party they may decide the waive this fee, but this will be entirely at the discretion of the restaurant. Some owners also sell advance tickets for occasions such as New Year’s Eve and special prix-fixe menus that will be in high demand. You might be wondering if restaurant’s are
Turn Those Charges into a Gift Card
If you decide to charge the diner for a no-show, you might want to consider putting these charges on a gift card that the customer can use with you at a later date. This can be a shrewd move as they can only use the gift card with you and they will be likely to spend much more than the gift card holds. Also, by setting an expiry on the gift card you can reclaim the charges to your business bank account if the customer fails to use the card.
Move to a Ticket Based Reservation Model
In a now industry famous blog post, Nick Kokonas of Chigaco based Alinea restaurant, outlined with data their hugely successful move to a ticket-based reservation model. Taking a significant or full payment upfront for a dinner reservation certainly reduces your no-show loss to effectively zero, but unless you’ve already handling a month long waiting list, it will probably impact bookings negatively.
A Clear Reservation Policy
However you decide to deal with no-shows at your restaurant, a clear restaurant policy will ensure your customers know exactly what to expect if they don’t turn up or miss their reservation window. Whether you have chosen to charge a no-show fee or simply send out reminders prior to their booking, a customer in the know is more likely to behave and either show up as expected or call ahead to cancel.