Comments on: Do Cancellation Policies Hurt Bed and Breakfasts?

By: Diana

Diana — Wed, 10 Jun 2009 22:06:59 +0000

The longer I am in this business, the more important it is to have a firm cancellation policy! Our cancellation policy is stated in the Reservation Confirmation email upon booking:
$25 cancellation fee for any reason.
Two-week notice of cancellation – only $25
If less than two weeks notice – Full charge unless we can rebook – then only the cancellation fee. (My time entering all their info. and phone time.)
We are a military/university town and thrive on those bookings. Cancellations show up on Availability Calendar immediately.
BUT: Have had 2:00 a.m. call to cancel because they were “having too much fun at Wedding Reception”. Had already charged the person’s card who had given them the Gift Certificate. They then called a year later and wanted to redeem the expired Gift Certificate. Told them I would honor it week-nights only if they paid $25 for re-entering all their info. Never called back to make reservation. (I did not tell the person who gave them the Gift Certificate that they had cancelled in the first place.)
I look at the cancellation fee as my insurance policy: They invest in my integrity to reserve the suite for them, I invest in them to honor their reservation and show up by agreed upon check in time.(Wedding night couples by midnight, all others – 4:30-8:00 p.m.)
With only 3 rooms, last minute cancellations means loss of income and expenses in preparing for our special guests.
I’m also a much nicer person the next morning so that our faithful guests can enjoy my sparkling personality during breakfast if I’ve had more than 4 hours of sleep!

By: Norma Daniel

Norma Daniel — Tue, 09 Jun 2009 21:30:21 +0000

HighFields is both a day and destination retreat. We advertise a 10 day cancellation policy for overnight guests and a 48 hour cancellation policy for day guests. We don’t take a deposit. We ask for credit card information when taking a booking, advising that we need this information in order to secure the booking. This way there is a commitment on the part of the client. However we don’t process credit cards until the guests arrive. I really feel there is no point in processing a deposit because if the guest doesn’t show or the guest cancels, the guest could dispute any charges with the credit card companies and if we don’t have a signed copy of a credit card charge, the credit card companies reverse the charges. There is also Credit Pre-Authorization which simply holds the funds for 30 days. We’ve really never experienced any problems that we couldn’t live with.

By: Howard Levitan

Howard Levitan — Tue, 09 Jun 2009 20:53:36 +0000

Thanks for all of the comments on Cancellation Policies. Clearly this is a hot topic, so let’s keep the discussion going. For those of you on Twitter or FB, how about making a reference to this Posting so that we can have a broader discussion of best practices in our Innkeeping Industry?

By: Frederique Procyk

Frederique Procyk — Tue, 09 Jun 2009 20:26:31 +0000

We have a well written cancellation policy on our website, reservation confirmation, any paperwork… and I always had a good feedback from guests who think this is a fair one.

We have the 14 day cancellation policy, and we take $25 cancellation fee on all cancellations (our time is paid!).

If the guest cancels less than 2 weeks, but more than 4 days before arrival, we give them a credit voucher valid for 4 months if the room remains unrented. They can come back and they do not loose their entire deposit. If they cancel within 4 days before arrival, we do not refund anything and do not give any credit voucher, unless the room is rented again.

Guests usually understand very well this cancellation policy. Of course, when they call to cancel, sometimes we might be even nicer and not charge them the cancellation fee, and if they are repeat customers, we usually refund entirely the deposit without any problem!

I also found that our cancellation policy is well accepted overseas, where Europeans usually like to have a complete written cancellation policy when they book a room.

Frederique Procyk
http://www.twitter.com/cranmoremtlodge

By: Monica Kissane

Monica Kissane — Tue, 09 Jun 2009 19:52:46 +0000

Hi!

Good question. And one which we really can’t know the answer to! A guest who doesn’t like the policy won’t book. They won’t call and say, ‘I would have booked but I don’t like your policy.’

My feelings on having a good cancellation policy on the website, in the email confirmation and on the phone is that a guest who is waffling won’t book. Good. If they don’t hold the room up until the last minute before they decide to cancel then a guest who really wants to stay has the opportunity to do so.

Quite frankly, if a guest went on a review site and said they didn’t like my cancellation policy, one they agreed to in writing, I’d thank them for pointing out to other possible guests that we are serious about this.

Our policy is not harsh. We ask for a one week notice of cancellation. Unlike some of the other comments here, cancellations are quite common, up to and including guests walking in the door saying they don’t need all 4 rooms they booked and they don’t expect to be charged. In season, the last minute cancellations are rebooked almost immediately so we’ve rarely had to charge anyone.

What I’ve found with being lenient on the cancellation policy is this: The guests either never rebook or they rebook and cancel multiple times.

Monica

By: Karen Thorne

Karen Thorne — Tue, 02 Jun 2009 14:49:36 +0000

Howard
Thanks for posting in your blog and Twitter about cancellation policies. My immediate reaction was that my cancellation policy was not putting anyone off – however I don’t know how many people read the website and decide never to book.
I’ve since reviewed our policies and now refund the deposit minus a £5 fee if people cancel more than 14 days out. I was charging a £25 fee. I need to charge something because with high bank charges I would be out of pocket.
I also now say I will refund the deposit for cancellations made within 14 days if I am able to re-let the room.
I’m sticking with my check in times – if it’s a day when I’m doing all the cleaning myself and it’s a 3 room changeover it does take me till 4.00 to finish!
Thanks for opening the discussion. It can become too easy to get stuck in your ways and forget to review what and why you are doing things.
Karen

By: Barrie Gould

Barrie Gould — Sat, 23 May 2009 05:29:47 +0000

Hi Howard,
Came across your discussion the following morning after we had a family decide not to stay the full three nights that they had agreed on. As mentioned by some of the other comments, this is very rare. We are also very small in as much we only have two rooms, in fact one double as both rooms are inter connecting.
Our property is 400 years old and we cannot have en suite as the building is listed.
This time though the comment we were given was that the road was too narrow and dangerous , we live about one thousand feet up in the hills of Wales.
We do not have a full diary this year and we spend on food when we get a booking and with this particular case we have lost three nights for three people £225. We did keep the 10% deposit though.
Would like to know about other bed and breakfast owners experience on this matter.
Cheers Barrie.

By: Jack Trowell

Jack Trowell — Thu, 07 May 2009 18:26:49 +0000

I also have a 14 day cancellation policy, but am somewhat flexible in the execution of the policy. If I can rebook the room, there is no charge. If I am not full and therefore am only losing that one room, I usually will not charge and will write a nice email telling them that fact. Often times, the person will rebook for another time. I also offer what I call “peace of mind”. The guest can purchase “peace of mind” for 8% at the time of the booking and with that program, they are able to cancel up until noon of the day of check-in. So far, I am ahead of the game. Jack

By: Colleen Rinaldi

Colleen Rinaldi — Wed, 06 May 2009 18:53:38 +0000

Hi Howard,

Thank you for including our comments from the Sabal PALM House Bed and Breakfast .

Below is the cancellation policy we have on our web site:

“We are a small inn and consequently cancellations affect us significantly. Cancellations made in the two weeks prior to your arrival will result in a charge of one night’s cost or 50% of your stay, whichever is greater. Should it be necessary for you to depart earlier than your confirmed date, you will be responsible for the full amount of the intended stay, unless we are able to book all nights.”

As noted above, we are small–only 7 rooms. We hate it when we have to turn people away from our Inn because we are fully booked and then have someone cancel last minute and all those potential guests have now booked somewhere else. We explain our policy to our guests when they are reserving a room and do mentinion verbally that we will not charge a cancellation fee if we can book all of the nights they are coming. We have been more vigilent in explaining our policy during high season and holiday weekends when a last minute cancellation can really hurt.

Thanks again, Colleen
http://www.twitter.com/sabalpalmbnb

By: April

April — Wed, 06 May 2009 17:42:49 +0000

Hi Howard –

Thanks for inviting TripAdvisor into the conversation. We don’t have hard data around cancellation policies resulting in adverse reviews, but we’ve gotten feedback on this from the bed and breakfast and inn communities.

A traveler might write a negative review for a property even without completing a stay because of a cancellation policy problem. Travelers often expect policies to be similar to those of major hotel chains, and are unpleasantly surprised when they’re more restrictive. Our advice to owners is simple – be painfully clear about your policy, whatever it is. The reservations process is a significant part of the guest experience and a bad experience, even without a stay at your property, may result in a review.

All reviews impact a property’s popularity ranking on TripAdvisor, but they are also an opportunity for future guests to learn about your policy and avoid surprises. And if you feel the traveler didn’t accurately describe the situation, we encourage you to write a management response and set the record straight. How you respond is often times more important to potential guests than the negative review itself. For details on the management response tools, please see http://www.tripadvisor.com/help/instructions_for_writing_your_management_response.

Thanks. Feel free to follow up with me on Twitter if you’ve got questions.

April
http://www.twitter.com/TripAdvisor