They’ll Be Here Soon
One of the most interesting decisions that a restaurant or even a pub needs to take when it comes to their food offer is whether or not they insist customers make reservations. For most fine dining restaurants that is an overwhelming yes. Conversely at the more casual end of the spectrum it is usually a no. Of course in reality most operator steer a middle course. They prefer bookings, who wouldn’t, but they also accept and sometimes encourage walk ups as a way to fill tables when things are quiet.
Of course taking bookings is one thing, whether or not your customers actually turn up is an entirely different matter.
Like many people I have on occasion turned up a bit late for a lunch or dinner reservation. When this has happened and I am probably talking about 10 or 15 minutes at most, I have expected and thankfully found that the table has been kept and not given away to someone else. In my view once a customer is over 30 minutes late, assuming they haven’t called ahead, then you are within your rights to give the table to someone else. Let’s be honest in this day and age most people have got a mobile phone. So there shouldn’t be any excuses.
Therefore based on my own experience it wasn’t until recently that I became aware of the scale of the problem that many operator face when it comes to customers not turning up at all. A survey in 2015 estimated that British restaurants were losing somewhere in the region of £16bn annually due to no-shows. On an outlet by outlet basis I have heard operator quote 10% as the norm, with this rising to 20% in larger cities.
With margins often quite tight, no-shows at this sort of level can wipe out any profits you might have hoped for from any given sitting.
Depending on the scale of the problem, there are a number of different ways in which you can manage things to eliminate or at least reduce the impact on your venue from guests who book but don’t turn up.
Whether you take bookings via an online system or by telephone it is really important that you take a contact phone number at the very least and if possible also an email address. Armed with this information you then have the opportunity to phone, text or email your customers to give them the chance to confirm, re-arrange or cancel any prospective booking. This usually works best when it is done on the day the reservation is made for.
This can obviously be time consuming or costly but you need to weigh that up versus the lost revenue from having empty tables. More positively, done correctly it can show guests that you value their custom and indeed it can be used as an opportunity to upsell.
Another approach is to be very clear on your website and when taking booking that tables will only be held for so long. Give diners a set period of time before giving away the table. About 15 minutes is a good standard. Some businesses choose to extend the window if diners call ahead and let the restaurant know they are running late. Of course this approach is most suited to outlets who know they have other customers who will take these tables.
A third option, albeit my least favourite, is do what the airlines do and overbook. The obvious downside of this is if all the diners turn up, you then have the problem of how long some of them have to wait which may result in negative feeling towards your outlet.
When it comes to making bookings on or around special occasions such as Valentine’s Day, Mother’s Day or Christmas then most restaurants will ask for a deposit. In some cases this will mean asking customers to hand over cash or at least provide credit card details. There is no reason why this can’t be extended to the rest of the year. If it seems too harsh then you can always decide only to ask for credit card details for bookings made for five or more people. You should then be clear in you terms & conditions that you will charge £X per head if cancellations are made less than 24 hours in advance.
I know that many operators who adopt this type of approach feel quite uncomfortable in applying it, and so often waive it. I can appreciate this point of view but worry if this becomes the norm then it doesn’t really stop people not showing up.
A really nice compromise to this is rather than charging customers money they won’t get back, refund the no show fee as a gift card. This gives customers a reason to choose your restaurant again, so you may be able to serve them at another time.
Of course if you are very popular you can take a very dim view of no-shows and deal with them quite severely. The following is taken directly from the Gordon Ramsay Restaurant website.
“Restaurant Gordon Ramsay requests a credit card number to hold this reservation. It is our booking procedure to secure the booking with credit card details. In the event that the booking is not honoured in whole or in part by you, or is cancelled by you with less than 48 hours’ notice it will be at the discretion of Restaurant Gordon Ramsay to charge £100.00 per person for lunch or £150.00 per person for dinner to your card and you agree to receive promotional material from Gordon Ramsay Group.”
Don’t take reservations
Of course you can eliminate the anxiety of no-shows by not taking reservations in the first place. This policy works best for busy outlets who either have lots of regular customers or who rely on passing trade.
Alternatively limit the way in which you use reservations. They could be restricted to certain times of the week or you may only have so many tables which can be reserved, with the rest available on a first come first serve basis. If you adopt this approach just make sure that it is clearly communicated via your website, in outlet and by your staff. Not doing this properly is likely to cause confusion and annoyance with would-be customers.