5 Tips To Help Manage Your Cancellations and No-Shows

Have a clear cancellation policy set out. Ensure the guest is aware at all stages of the booking process what the cancellation terms and conditions are.  Have a specific date by which they can cancel by so it is clear cut for your guest.  Ensure that during every correspondence with your guest that the cancellation policy is in writing, under the terms and conditions, as a reminder to them

Know where your bookings come from.  If you receive a booking 6 months out from a domestic booker, the chances of this booking being canceled are high.  Whereas, if you receive a booking 6 months out from an overseas booker, travelling a long distance, America, China, Australia etc, these bookers are a lot less likely to cancel because of the nature of their travel being long haul organisation is key.  Having a clear view of where your bookings are coming from and who your booker is will give you a better idea of your cancellation trends by channel.

Reminder emails are a great way to keep in contact with your guest before they arrive at the property. They can act as a reminder for the booking as a whole but can also be used as a way of up-selling features of the property i.e. dinner, spa, golf etc.  PMS Systems can automatically send these emails out which takes away the stress of following up from your Front Desk or Reservations team.  (See our blog post on How to Increase In House Spend and Improve Your Customers Experience for more information on this)

An Advanced Purchase option is always a good idea to not only keep cancellations down but also to help drive more bookings direct. Offering a discounted rate when people pay upfront is a proven way of reducing cancellations and no shows because people will not commit to paying in advance unless they are sure of their arrival.  It is a good way to control last-minute cancellations when there is an event on in your area, concerts, or business conferences.  This will help you cut out the “just in case” bookers.

Overbooking is something that can help you manage your occupancy. With cancellations and no shows being the norm in the hospitality industry, it can have a negative impact on your overall occupancy percentage if you are getting rooms back last minute and unable to sell them again.  Instead of filling to capacity and then closing all channels immediately, allow your system to overbook by a certain number (this will always be property specific) and therefore you will be able to maintain your high occupancy without dropping your rate last minute when the inevitable cancellations do come through.  This method will not work for all properties but if you can study your cancellation and find the trend for your property then this could be a big help your property in the long run.