No-shows in restaurants cost a pretty ‘penne’

No-shows in restaurants

David Wheatcroft, Head of Corporate European Hospitality at Elavon Europe shares three ways restaurants can reduce instances of no-shows.

Since restaurants and pubs reopened in April, one in seven people in Britain booked a table and failed to turn up for their reservation. Today, as the hospitality sector grapples with economic recovery, pent-up demand for eating out and staff shortages, the impact of no-shows in restaurants is greater than ever before, leading to restaurant job losses and permanent restaurant closures. Unused tables not only result in wasted food but impact the livelihoods of local producers, managers and owners and the service and kitchen staff. 

Research has found that the most common reason behind no-shows in restaurants is ‘spread booking’, that is, when diners make reservations at more than one restaurant at the same time to give themselves options but only intend to honour one of them. In a sector where profit margins can be slim and success often hinges on disposable income, empty tables can break an already shaky bottom-line. 

However, the industry’s resilience is steadfast, and the sector appears poised for recovery. Recent Elavon consumer research found that as many as 34% of consumers are planning to eat out more often at restaurants in the next six months. As restaurants battle no-shows, it’s time to exercise resilience once more and seize the opportunity to adopt an industry-wide stance that supports restaurateurs and offers an unforgettable customer experience.

Take a deposit for every table 

A small deposit on a booking can go a long way to safeguard a business and protect its future. Theatres, cinemas and aeroplanes take full payment upfront for their seats yet customers never query this. A deposit will not fully compensate for the cost of a no-show, but it will deter diners from spread booking. Advances in technology make this easier than ever before. A deposit can be integrated into the booking process and automatically be deducted from the final bill or be charged to anyone booking who commits a no-show. However, this must be clear in the policy and the customer must provide consent to avoid the risk of chargebacks.

No-shows in restaurants

Issue timely reminders and follow-ups 

Issuing timely reminders via email or text leading up to the booking can reduce the likelihood of no-shows in restaurants and provide an opportunity to collect contacts for future marketing messages. If a customer has not arrived for their booking on the day, each restaurant should have a policy, for example, calling or texting after 15 minutes. Regardless of whether they commit a no-show, a follow-up using the same method as the reminder can allow a business to learn from the lost booking or the dining experience. 

Take bookings and cancellations digitally 

A booking system online or via an app can be used as an opportunity to clarify policies and outline what customers can expect and how they can order and pay. Using a booking system also allows the restaurateur to regulate sitting times and traffic volume at the busiest times – all of which improves the diner experience.

In the current climate, a Covid-19 diagnosis or unforeseen self-isolation period is likely to result in last-minute booking cancellations. Historically, the notice period would have been 24-48 hours but venues in areas with a lot of footfall may be able to exercise more flexibility than those in more remote areas.

Ultimately, digitising the diner experience can do more than simplify the booking and cancellation process. Modern payment systems can facilitate adding staff tips, splitting bills for groups and sending receipts digitally. Meanwhile, table orders can marry up with the current stock inventory to keep staff and customers informed of what has run out on the menu. Not only can a modern system bring together efficiency and safety while fostering loyalty through great customer experiences, it can also give measurable tracking and insights that can be used to strengthen a business.

Prevent no-shows in restaurants and more

See more of Elavon’s hospitality insights in its latest whitepaper, Embracing Transformation in Hospitality