No-shoes remain a blight for the industry, with our latest research in partnership with CGA by NiQ, showing that 12.3% of guests who make a booking don’t let venues know their plans have changed and proceed to no-show rather than cancel. These unfulfilled bookings are currently costing the industry an estimated £17.59bn in lost sales, however in reality, the impact is much more significant than that.
This figure doesn’t take into account food waste or overstaffing, for example, nor does it take into consideration the financial impact of lost business from keeping a reserved table for guests that will not arrive. And, unfortunately, there’s not much sign of improvement.
Our latest research has shown that the no-shows rate has doubled since August 2022, rising from 6% to the 12.3% figure mentioned before. This indicates a worrying trend as our industry faces continuing external challenges that will likely continue into 2024. Taking a deep-dive into the data, we can see that the worst affected sector, restaurants, account for over a quarter (27%) of businesses impacted, followed by food-led pubs at just under a quarter (24%).
Who are the no-shows?
Young people continue to be at the forefront of the no-shows problem, with 40% of guests aged between 18 and 34-years-old having admitted to being a no-show. This figure drops significantly the older the guest is – just 13% of 35- to 44-year-olds no-show, dropping further to 6% of 45 to 54 and 55 to 66-year-olds. For the entire 65s and over, the no-shows rate sits at only 3%.
This disparity is partially down to the fact that younger adults tend to make bookings more frequently than their older counterparts. In our previous research into consumer booking behaviours, 73% of 18- to 34-year-olds said that they’d made a reservation within the previous month — well above the national average of 60%, and of the older 65+ demographic at 52%. It may also be down to younger consumers remaining more spontaneous, with last minute changes to plans being more commonplace.
Interestingly those who more frequently visit restaurants, pubs and bars are more likely to be no-shows, with our most recent data showing 21% of those who go out weekly no-show, dropping to 10% for those who visit monthly and rising again slightly to 13% for those who visit less than once a month. Geographically, Londoners are the most likely to no-show.
What can be done about the problem?
Of those that have failed to show up for a booking, 16% simply forget about their booking. Sending out reminders appears to be one of the simplest and most obvious solutions to tackling no-show rates, with all the evidence suggesting that venues that send reminders ahead of time have far lower no-show rates than venues that don’t.
The timing of these reminders can be a key factor in their success. According to our research, the most popular timeframe for guests to receive a reminder is a few days in advance at 38%, followed by the day of the booking (28%) and a week in advance (11%). Systems can be set up to do this automatically, easing the pressure on staff and providing a better experience for guests.
Ensuring that it’s easy for customers to cancel their booking is another effective way of combatting no-shows. More than half (51%) of people prefer to cancel a booking digitally, so clearly signposting how and where guests can cancel should they need to can have a significant impact. This process should be simple, easy to navigate, and require just a few clicks to be truly effective.
Deposits can be another solution to the no-shows problem – albeit a more controversial one. When we last asked the public about this in our consumer research, we found that over half (51%) said they would be willing to pay a deposit to secure a booking, however with this remaining close to 50%, it remains a divisive issue. This changes, however, when it comes to booking for a large group or special occasion, with 65% willing to pay a deposit to secure a booking in these instances – however this drops down to 45% for casual occasions. 45% is still a significant number of customers, however, and so whilst deposits may not be the way to go for every venue, it’s worth keeping an eye on general consumer sentiment. This means that, whilst not a catch-all solution that would work in every type of venue, situational applications could be effective – such as large group bookings or special occasions – to put a safety net around these bookings and reduce the likelihood and potential of a no-show. However, it’s important not to be too heavy-handed with this approach, as guests likely won’t want to pay a deposit for a casual lunch if it’s not necessary.
Lessons learned from other industries could also provide options worth considering too – such as the practice of over-booking. Whilst there may be some hesitancy towards this, the data collected from reservation systems could be used to identify when, where and by how much you might be able to over-book whilst not impacting the guest experience. Whilst this may be a drastic change at first, customer acceptance would likely increase if adoption spread throughout the industry.
Join the conversation and help us make no-shows a thing of the past
No-shows cost the hospitality industry an estimated £17.59 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.
How can hospitality businesses combat no-shows in 2023?
In this webinar, industry experts from Zonal, Mitchells & Butlers, and Bums on Seats, explore the current bookings landscape, the impact of consumer loyalty on no-shows, the importance of real-time booking availability, and share their advice on processes and procedures operators can start implementing today to start tackling no-shows in their business.