Has your restaurant experienced many no-shows? Many restaurants have and it happens to everyone in the industry at some point.
No-shows are people who reserve a table at your restaurant but fail to honor it. Perhaps an emergency came up that prevented them from coming, or maybe they changed their dining plans at the last minute and went somewhere else. These no-shows cost your business revenue!
Luckily, there are 6 ways you can reduce the number of no-shows at your restaurant. And we’re sharing tips on how to do just that in today’s guide.
Why No-Shows are Horrible for Your Business
If you’re like most restaurant owners, you’re likely always looking for ways to increase seating capacity and reduce no-shows. After all, an empty table means less money in your cash register. And, no-shows can be frustrating—not only do they impact the day’s sales, but they also leave staff stranded with empty tables, creating chaos in your dining room.
Bottomline, they cost you a ton of revenue.
For example, let’s say you have 100 seats in your restaurant and about 50% of your average nightly volume comes from people who make a reservation. Now, each diner spends an average of PHP1,000. This means that even if only 10% of your reservations are no-shows, you could still lose out on PHP5,000 per night. That’s more than PHP35,000 a week.
To make things worse, the restaurant industry generally accepts a no-show reservation rate of about 20%. If we apply this to the example above, your business is losing out on PHP10,000 per night or PHP300,000 a month.
6 Strategies to Reduce No-Shows at Your Restaurant
It’s not just small restaurants who have to deal with no-shows. Even Michelin Star Rated restaurants experience it, and that’s the kind of fine dining you think people wouldn’t want to miss. So, if you’re looking to reduce the number of no-shows at your restaurant, there are a few expert-recommended strategies you can try.
1. Invest in Reservation Software
When was the last time you upgraded your restaurant operations? If it’s been a while, you’re probably still using an old-fashioned method—taking reservations over the phone or text and jotting them down in a notebook. This may have worked before, but there are now more efficient systems.
Plenty of dedicated software options can automate your restaurant reservation system, giving you access to real-time booking numbers and eliminating the risks of human error. It also reduces your staff’s workload, allowing them to focus on serving guests and ensuring they have a great dining experience.
When investing in restaurant reservation software, consider the following:
- Does it allow people to book from multiple platforms?
- Does it enable customers to add notes to their booking?
- Does it have a real-time two-way SMS feature?
2. Charge a Reservation Fee
If you want an easy way to reduce no-shows, charge guests a booking deposit whenever they make a reservation. You can also hold their credit card details in case they cannot make it to their reservation.
Many high-end, fine-dining restaurants use this strategy—for example, Restaurant Gordon Ramsay in London charges $225 per person if a reservation is canceled or unfulfilled. Meanwhile, Eleven Madison Park in New York City charges $75 for the same.
Note that this strategy won’t work for every restaurant. If you own a small and homey establishment, then forcing customers to pay a hefty no-show fee would only turn them off. A better option would be to charge them a small booking deposit, which will then be credited to their final bill.
3. Follow Up
Reach out to guests a day or two prior to re-confirm their booking. Not only does this help them stay on top of their reservation, but it also enables them to cancel it easily. You can do this by sending a text or dropping them a quick phone call.
Alternatively, some restaurant reservation software automatically sends email and/or SMS reminders to guests. All this works well to reduce no shows at your restaurants because you’re holding your guests more accountable.
Plus, if they cancel a few days in advance, you have time to rebook the table.
4. Make it Easy for Diners to Cancel
This might seem counterintuitive, but in reality, some people fail to cancel their reservations because of how hard it is to do so. However, if you provide them with an easy and convenient way to make changes to their booking, then they’ll be more likely to do so ahead of time, resulting in a reduced no-show rate at your restaurant.
Some restaurant reservation software offers this feature. But if you prefer to do this manually, then make sure that you’re reachable on several different platforms including popular messaging apps, like WhatsApp and Facebook Messenger.
The easier the cancelation process, the more likely guests will do it, freeing your tables for walk-ins or customers making last-minute reservations.
5. Establish a Strict Booking Policy
For better results, combine the above mentioned strategies with an official booking policy. This establishes your restaurant’s terms and conditions, such as how long staff will hold a reserved table before giving it away to another customer. It should also outline the fees that guests must pay if they cancel their booking last minute or fail to show up.
Some restaurant booking policies include information on what guests should expect before making their reservations. For example, the Kings Arms Otterton in Devon states customers must pre-order their food if their booking is for a party of over ten.
6. Use Social Media to Raise Awareness
The problem of restaurant no-shows can be attributed to a lack of understanding among customers of how failing to fulfill their reservation affects your business and staff. Many owners are now trying to change this.
If this is too much for you, consider using your restaurant’s social media channels to explain how no-shows hurt your business. Simply using the math example we mentioned above could be very helpful in making them understand the problem.
Boost Your Restaurant Reservations
Life is unpredictable, which is why you can’t fully eliminate no-shows in your restaurant. But with these six strategies, you’ll show customers why they should fulfill the reservations they make.
As a restaurant owner, you know that making the right decisions can be the difference between success and failure. But with so much to keep track of, it can be difficult to know where to start. That’s where we come in. Mosaic Solutions restaurant management software is designed to help give you the insights you need to make smart, data-driven decisions that will help your business thrive.
Reach out today to see how you can improve your restaurant operations!