Should pubs use deposits to tackle no-shows?

By Nikkie Sutton

- Last updated on GMT

Pay and display: There’s not a lot worse than no-shows at your premises – your site is empty, staff are doing very little and there’s no money to pay them
Pay and display: There’s not a lot worse than no-shows at your premises – your site is empty, staff are doing very little and there’s no money to pay them
Customers that fail to arrive after booking a table are a bugbear for operators across the hospitality trade but could charging a deposit be the answer to this problem?

Running a busy pub and getting the right amount of staff , food and everything else required for a smooth service is a balancing act itself. Throw in customers who book and then don’t show not only impacts the running of a business but a pub’s bottom line can take a significant hit too.

However, operators have called out for the trade to take a stand and charge a deposit payment for bookings in order to reduce the number of no-shows.

Booking system ResDiary stated the number of restaurants taking some form of payment in advance increased by 40% in 2018.

It also revealed online bookings through its system had soared by 130% in the past ­five years and almost 60% of all bookings are now made through mobile devices.

Brendan Pad­field, licensee of the Unruly Pig in Bromeswell, Suffolk, explained how he has tried to eliminate no-shows.

He said: “We were getting at least one or two tables of eight just not showing up on Saturday nights.

“You can imagine that if you had one of those it makes a big difference – two of them is pretty crippling. You have lost your profit.

“We introduced a deposit system and that got rid of that. It was £10 a head and that worked.

“As soon as we asked for the deposit, we didn’t get large party no-shows but originally we only asked for it for more than eight people.”

Pad­field revealed why he has implemented the deposit system to end no-shows at his premises.

He added: “Over the past year, we had been noticing an increasing number of parties of varying sizes not showing on a Saturday night and Sunday lunch, when we are always fully booked and often there is a waiting list.

“We also noticed when we tried to contact these people to ­find out what was happening –we leave it 15 minutes after the time they have booked and then we phone them. Sometimes they would take the call and say ‘I’m so sorry, I forgot but we’re not coming’ but sometimes they wouldn’t take our call.

“They say ‘well you’ll just resell the table’. What are the chances of reselling an 8.15pm table when you’ve waited 15 minutes to call them anyway? What are the chances of reselling at 8.30pm? Slim.

“At peak time on a Saturday night, we are a destination, drive to, country pub where the chances of getting people popping in after they have had a skinful on a Saturday night are zero, it just doesn’t happen.

“One weekend, we had 13 tables not show over Saturday and Sunday lunch. Of the 13, 11 blocked our calls after we waited the 15 minutes and called them.”

The pub now has a system in place to avoid losing money due to no-shows and Padfield explained how customers have reacted to it.

He said: “We introduced a system whereby we now just ask for the credit card details just to secure the booking. Just like most London restaurants, just like any hotel.

“We don’t charge the card [at that point]. We only charge the card if they don’t show up.

“We have the details and use payment processing platform Stripe, which is attached to our EPoS system. ­ Is system means no one at the Unruly Pig can ever access those card details and as soon as we click on the computer to confirm that the party has arrived, those details are automatically destroyed.

“We don’t charge, we just hold it [and as a result] our no-shows have virtually gone to zero.

“­There was some resistance to it but when I tell them what has happened in the past, most people are understanding and sympathetic.

“Of course, there are some that are disgruntled but most are understanding and what actually happens is if people phone up and say ‘look I’m really sorry, my granny is ill’ and they re-book, of course, we don’t charge.

“All we are trying to do is to get people to phone and exercise some basic courtesy.”

Matt Slocombe of the Crown Inn, Woolhope, Herefordshire, echoed the issues of no-shows and laid out how it impacts his business.

He said: “­The biggest issue I have financially is when you have laid on extra staff because of big bookings and you have prepared more food then – all of a sudden – they don’t turn up.

“I know some places start charging deposits and taking card details, but it is almost impossible to do that in a rural pub in Herefordshire.

“We started taking deposits for special bookings such as Mothering Sunday, we take a £5 per head non-refundable deposit to con‑ rm the booking.

“Even then, they say ‘well my mum and dad don’t even know if they are coming yet’ – but why are they booking the table?”

Reservation (1)

Society has lost its manners

Larger parties that book for special occasions are also guilty.

Slocombe added: “I have definitely noticed Christmas parties in recent years where people are booking for 20 or so and, when you call them up four days before because you haven’t heard anything from them, they tell you they are going somewhere else now.

“People are booking three or four venues and then deciding where they want to go and not letting the venues know that they are not going so it isn’t just one place that is being affected, it’s two or three from the same booking. I don’t think it hurts to take a small deposit.

“We had no-shows on Christmas Day. Some had even paid a deposit and still not turned up.”

He outlined how the wider society has lost its manners and how hospitality has borne the brunt of this.

Slocombe said: “It’s a bit of a reflection on general politeness, it’s so rude. If you didn’t turn up to your MOT, the garage would call you and say ‘you booked that spot so I am going to have to charge you for that’.

“If you don’t turn up for your dentist, you get charged. If you turn up to the dentist and you wait 40 minutes, they might say sorry but they don’t give you a discount. Whereas if someone turns up and waits 20 minutes because you’re busy they expect a free drink or something.

“­They are very wanting in our trade for us to bend over backwards and put things right instantly and yet people are surprised when they might lose their deposit because they don’t turn up.”

But, taking deposits is the answer, according to Stosie Madi – chef-patron of the Parkers Arms, Newton-in-Bowland, Lancashire.

She said: “We have stopped no shows. Up until two or three years ago we would have lost a good 20% of sales on busy days.

“We thought enough was enough and we implemented taking card details. Our booking conditions are very simple. We take credit card details, bookings are done automatically online, we don’t take telephone bookings any more so we don’t have to deal with it.

“The terms and conditions say ‘because of the rural nature of our business we require 24 hours’ minimum cancellation notice otherwise, failing to do that or not showing, we charge £10 per head on the table booked’.

“Since we implemented this three years ago, we have had three no-shows. We had a dip in bookings to begin with and we still get the odd person who rings up to book a table.

“We ask for credit card details and if we can’t take them, we say we cannot take their booking. All bookings can only be taken with card details.

“Some customers will ask why and we tell them that we are a rural business, sometimes people don’t show up and we are out of pocket. We rarely have a problem and 99% of our bookings are online.

“I have had two situations where people could not show up on the day and they called us, explained their problem and, of course, we say that it is not a problem and we will cancel the booking and any potential charge.

“On Mother’s Day, we take a 50% non-refundable deposit on every booking and customers are told it is non-refundable. We don’t negotiate.

“One week before the event, we will let them know this is their chance to take the booking away or pay the full amount. We don’t risk people not showing up on the day.”

Adam Thorpe, former GM of the Punch Bowl Inn, Crosthwaite, but now of bistro the Estuary, Grange-over- Sands, in the Lake District, is in agreement with other operators and stressed how much of an issue no-shows are for individual operators and the trade overall.

He said: “It’s a big cost for the industry and, unfortunately, with the best will in the world you can try and take credit card details off people and a lot of places do.

“Online bookings at the Punch Bowl do take credit card details off people but people are really against it.

“They say ‘we are definitely coming’ but unfortunately it is a few bad people spoil it for the rest. No-shows are a massive cost for the business and so, you should charge people.”

Staffing costs add up

He highlighted that a business can stand to lose a lot by not having a system in place to prevent them.

Thorpe added: “The worst-case scenario could be up to £1,000 a week. One Saturday, we had eight people not show up and that is three individual tables – a four and two tables of two.

“The staffing costs and revenue you have lost, can reach about £350 a week, which doesn’t sound a lot but it adds up.

“They book at more than one place and not cancel others. They just think it will be busy anyway but that’s not always the case.

“Even five minutes’ notice isn’t great but to just not phone at all is ignorant.

“If operators take card details and customers do not ring and cancel your booking, they should say they will charge the average spend per head, which may be £35 per head. The business has to try and recoup that booking.

“It doesn’t just affect the Lake District or a city, it affects the entire industry and millions of pounds of revenue.”

The Crown’s Slocombe also outlined how much the Crown loses on an average week, due to customers not turning up.

He said: “An average spend, if it’s lunch time, is going to be £15 per head but if it is evening it will be £20 to £25 per head.

“It’s probably a couple of hundred quid a week. It’s a member of staff, it’s one of your part-timers, it’s £1,000 a month, which is my rates bill.

“Taking deposits in the short term might ruffle a few feathers but actually when people get their heads around it, it isn’t the end of the world.”

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