If there's one thing the modern travel industry is good at, it's penalizing customers for its own dysfunctional systems.
Squeezing so many bodies on planes there's no longer enough space in the cabin? Charge passengers for bags! That decision causes a traffic jam for early boarding at the gate? Charge passengers to go first! And so on. Travel sellers no longer have much compunction about creating new inconveniences in their products because they've proved they can always burden customers with yet another fee, and some people will pay even more to avoid them.
This year, employers in the travel industry are dealing with an operational triple whammy of staffing shortages, supply chain woes, and inflation, and in a sensible attempt to balance demand with available resources, tourist services across the spectrum of travel, from museums to theme parks, have adopted the restaurant model of requiring advance reservations for entry.
Making reservations is simple enough to do. But increasingly, travel businesses are making those reservations binding—and extracting money from customers who, for whatever reason, are unable to stick to the plans they made in advance.
Take Kol Restaurant, a celebrated gourmet spot in London. Customers are required to supply a credit card to make a booking via the SevenRooms service, but if their plans change and they fail to cancel that booking within 48 hours of arrival, they're slapped with a fee of £90 (about $110) per person. That giant penalty is hidden in the cancellation policy, which is only displayed if the customer thinks to click the button that displays the optional pop-up window that discloses it.
It makes some sense. Some businesses take a real financial hit if people reserve tables but don't show up. Advance booking helps managers calculate both staffing and inventory demands. Kol, for example, is so tiny that it doesn't even have space to park baby strollers, so losing a table or two unexpectedly each night could be enough to put operating expenses in the red for the evening.
But on the other hand, there are also valid reasons customers might not always be able to know 48 hours ahead whether they'll be able to make their booking. One of the biggest: a positive Covid-19 test. We're still in a pandemic, after all. Facing fees of £90 per person, many people would be tempted to show up despite being infectious.
And it's not as if Kol currently runs the risk of operating with many empty tables, even if some customers do cancel. Its reputation is white-hot. In February, it became the first Mexican-cuisine kitchen in the United Kingdom to earn a Michelin star, and in May, its celebrated chef was the subject of a lavish, 7-minute feature that aired on the United States' CBS network. At Kol, reservations open two months ahead and are largely snapped up in hours—so any unexpectedly vacant table could be eagerly covered by a waiting list of people who are dying to dine there.
Kol's stratospheric penalty and problematic 48-hour deadline aren't unusual among some of northern Europe's most celebrated high-end restaurants now. Oslo's Restaurant Rest, for example, slaps no-shows with a penalty of NOK 1,950, or about US $200. Restaurants that are farther down the popularity food chain are finding similar tactics give them a bite at extra revenue.
Countless other restaurants are now converting their staffing difficulties into a burden of extra fees. Rules are by no means consistent: Most of the fees tend to be around $10–$20 per person, and sometimes the cancellation is permitted right up to the minute before the booking
Superb, a Danish platform that enables restaurants to levy no-show fees, claims in its sales materials that "no-shows wipe out around 20% of all restaurant bookings" in some cities. But Superb also acknowledges that its services also allow popular restaurants to double-dip and create "a financial safety net": "The silver lining is that when a party doesn’t show up (despite a no-show charge), you may be able to seat walk-in guests or those on your waiting list," Superb's materials tout. "When this happens, the no-show fee is more of a revenue boost than a consolation prize."
At restaurants in Disney's American resorts, the no-show fee is $10 per person, and the deadline to cancel a reservation is at midnight the night before. It doesn't matter if you've been delayed in line for a ride that broke down, and it doesn't matter if the restaurant has a line of willing customers waiting to erase any potential loss by taking your place (many Disney restaurants have busy walk-up queues)—if you don't show up within 15 minutes of your time, you're charged.
Disney's system has been in place for almost a decade, and when it was introduced, customers found it infuriating. Now it's becoming an industry norm.
A similar thing is happening with some travel agents. Travel Weekly reports that custom itinerary planner Authentic Vacations is dealing with staff loss by collecting $99 even before it starts suggesting vacations to shoppers. The charge is framed as a deposit; that $99 is applied to the cost of a future trip.
"Agencies and advisors have long been charging service fees to not waste their time on inquiries that are not serious," Travel Weekly noted, adding that a 2021 survey "found that the share of revenue from service fees increased from 18% to 27% from 2018 to 2020."
This year, as travelers face requirements for advance reservations for activities that never used to require them, we all have to think more defensively when it comes to our bookings.
Whenever you make your own reservations using an app or a web page, always click to open up the cancellation rules, even if they're hidden (and they probably will be).
Frustratingly, some of the online reservation services wash their hands of the truth of their own warnings. OpenTable, one of the United States' most popular restaurant reservation services, explains in its Help section that it "cannot be held responsible for the accuracy of cancellation policy information provided by restaurants for publication on OpenTable's online reservation form, confirmation emails, or reminder emails." It pushes responsibility for accuracy back on the business.
When a restaurant contacts you ahead of time to confirm your reservation, don't ignore it. It may be your last chance to cancel without a fee.
Most of all, it's now wise to keep a careful list of which of your vacation's reservations allow free cancellations, and when the deadline for each one falls.
And please—no matter how onerous the no-show fee, don't try to avoid the charge by showing up with a low-level Covid infection.