Ah, the old ‘No-show’ debate. No-shows have been an ongoing problem in hospitality ever since I can remember. I’ve conducted audits upon audits for businesses in our sector and in most cases, they all have one thing in common: an incredibly high no-show rate, with few processes to minimise its’ impact.
To put a more positive spin on it, minimising no-shows means more accurate financial forecasting and -more importantly- a far better guest experience which encourages loyalty and repeat business. But how can you reduce no-shows for your business?
Implement a deposit system
The first option for any operator is introducing deposits to secure bookings. I understand the apprehensions around introducing deposits – will it put customers off? Put it this way: do I really believe a customer will book elsewhere because we ask for a £5pp deposit to secure a booking when it’s redeemable? No, I don’t- not anymore. Customers want security when they book- by asking for a deposit you’re simply giving them the reassurance they want.
If the whole sector agreed to tackle no-shows in the same way and implement a deposit system, then this issue would resolve itself to everyone’s satisfaction: customers would commit to one venue (rather than booking 2 or 3 places and only turning up to 1), no-shows would drop dramatically and those who don’t want to put down a deposit can become your more casual ‘walk-in’ diners. The action of introducing deposits alone will go a long way to reassuring our staff, protect revenue, and give us the confidence to up-sell packages and experiences.
Build a relationship with your customers
Another contributing factor to no-shows is a lack of relationship between the business and the customer. Our sector prides itself on providing customers with truly wonderful memories and experiences with their friends and loved ones, but this doesn’t just start when the customers walk through the door – it’s the minute they first submit that online enquiry or pick up the phone to book.
Securing sales and improving guest loyalty requires the quality of your relationship to be scrutinised and put centre stage. Treat your customers as you would your close friends: by doing this, you create that all-important emotional connection. Customers will cancel in advance if they can’t come because they’ll feel bad: you’re not a building with a kitchen to them anymore. You’re family.
My job at Bums on Seats is increasingly to help established sales teams or individuals to acquire the skills to build and capitalise on these important relationships, without which hospitality cannot reduce no-shows substantially and go on to grow the bottom line through repeat business, new revenue streams, and ongoing customer loyalty. It is perfectly feasible with the right guidance, training and support to achieve a no-show rate of less than 10%, followed by accurate pre-bookings and more advance spending through up-selling packages and bolt-ons. This investment is needed – and justifiable – now more than ever.
Prepare for busy periods
As we’re about to enter our busiest period of the year, Christmas, now is the time to put these processes in place, effectively. Start by pulling together to invest in the right booking system for online payments, pre-orders and packages. Re-write your terms and conditions to reflect your own brand culture and language, and include a commitment to refund the deposit if a customer cancels within 24 hours of the event/table. Use SMS texts (where affordable) or personal calls which are proven to work by prompting customers and helping to avoid ‘no shows’, as well as building up a crucial relationship which encourages loyalty. By treating your customer as a friend and making it easier for them to cancel if they have to, you will have put your business back on the front foot and can look forward with increasing confidence.
Join the campaign to make no-shows a thing of the past
No-shows cost the hospitality industry an estimated £17.6 billion in lost sales every year. Join our group of passionate industry supporters to help spread the message far and wide and encourage customers to #ShowUpForHospitality.