Designing a Cancellation Policy Where You & the Guest Win
Last-minute cancellations are a painful subject for both the guests and hosts. How you respond to these requests is what sets the hospitality newbies apart from the hospitality veterans.
We’ve all been there; something comes up last minute and you realize that you are going to have to cancel your appointment- and most likely last minute. As a guest you feel terrible, as a business owner or tasting room manager, it may wreck your day.
The next step you take as a guest or as a tasting room manager will ultimately determine how the guest feels about your brand, short term and long term. Allow them to cancel last minute without recourse may set a pattern for other guests to follow and take advantage of you bending the cancellation policy rules. Rule the cancellation with an iron fist and you’ll never see the guest again and you’ll see this blow up into something much bigger on social media.
It is why we always recommend that whenever you have a customer interaction, trying to always empathize their situation. There are so many excuses that can be provided when cancellations are requested, you could fill a database if that, then what cases and still end up with some new scenarios. Take a moment to first thank the guest for contacting you to cancel. The alternative could have been simply no showing their reservation altogether.
Before we go further recommendations on responding to last-minute cancellations, you might also want to look at how you are handling your reservations. Many guest management systems like CellarPass offer confirmations to make sure the guest knows they are confirmed, but many do not offer automated reminders. CellarPass is set by default to send a reminder 24 hours before any guest to arrive, whether they booked a reservation or purchased a ticket.
The next level is the sudden increase in SMS aka text messaging. With the CellarPass Guest Link Pro or TablePro apps, you can actually send SMS messages, say an hour before the guest is expected to arrive. This will provide a same-day reminder, but also give them a chance to respond in a more informal manner in case they are lost, running late or totally forgot. This may not be a task you do daily, but on busy days, this would be a good way to prod people to cancel their reservations ahead of your cancellation policy, making room for those on the wait list to be converted or others to book because inventory is freed up.
Now that we’ve covered some proactive ways to avoid last-minute cancellations or no-shows, we’ll share some help ways to respond to requests for last-minute cancellations.
If they simply want to cancel, simply state your cancellation policy and offering the following:
- Look up their reservation and review their booking history or the reservation details.
- Is the guest a first-time visitor, club member or frequent visitor?
- Never ask them why they need to cancel.
- Offer to reschedule their reservation to a later date or a different experience.
The next step is based on how booked up your calendar is for that day and what your deposit policy is configured for your reservations. Are you pre-charging? If so, has their card already been charged?
- If this is a frequent customer or important club member, state your policy and offer a one-time courtesy to cancel their reservation without any penalty.
- If this is a frequent customer or important club member that starts to take advantage of this or reschedules last minute too many times for your comfort level, you might want to develop a more-standard response.
We would recommend for any case where you've already pre-charged their reservation and you do plan on holding their pre-paid funds is to convert the amount into an electronic gift card to be used on your online store.
You can save yourself a lot of time later by creating an email template that can be easily personalized with the guest's information, the amount of their credit, how to redeem and always offer to schedule some time to take their order over the phone.
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