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No-shows costing hospitality industry £17.6bn a year

No-shows are costing the hospitality industry £17.6bn a year and rising, according to a new report.

The data from hospitality technology expert Zonal and industry insight firm CGA also reveals that since sector reopened, one in seven (14%) people have not turned up to their reservation, with one in eight (12%) people saying they are more likely to no-show than they were before the pandemic.

The report identifies a strong correlation between no-shows and age, with 18–34-year-olds the worst offenders. Over a quarter (28%) of 18-34-year-olds have not honoured their bookings, compared to just 1% of those aged 55 or over. This is partly explained by the fact that younger adults are more frequent bookers in comparison to other age demographics, the statistics reveal. Nearly three quarters (73%) of 18- to 34-year-olds say they have made a reservation since April — well above the national average of 60% and older age groups like 65+ (52%).

There are ways operators can help mitigate no shows. According to the report, over half of consumers (55%) are willing to pay a no-show fee if they didn’t turn up whilst nearly as many (51%) would be happy to pay a deposit to secure a booking. Some 36% said they would be more likely to show up if the venue simply reminded them by phone, SMS, email or app.

Olivia FitzGerald, chief sales and marketing officer, Zonal said: “The knock-on effects caused by no shows are considerable. Staffing and stock levels are left seriously compromised in addition to the lost revenue for a table that could’ve been taken up by other willing guests, and all this comes with a significant cost to hospitality businesses.

“Pubs, bars and restaurants play a vital role in our communities and it’s important we continue to support them after this challenging time. While the pandemic has prompted a new-found appreciation and understanding of hospitality among many consumers, there is still more to be done in encouraging them to always honour their booking or tell the venue in advance.”

Karl Chessell, CGA business unit director - hospitality operators and food, EMEA, added: “Consumers are embracing reservations like never before, because they want certainty about their eating and drinking out experiences - and bookings can be positive for operators too if they help them to plan better. But the flip side of no-shows has come into sharp focus since the pandemic: they’ve been a bugbear for years, and the sales and cost implications are especially painful now.

“It’s much easier to identify the problem than find solutions, but reducing no-shows will be a big priority in the months ahead, especially as Christmas nears. Deposits can help, but there’s clearly still a barrier to acceptance among consumers, and they don’t suit all businesses. As spontaneity returns to hospitality, striking the right balance between reservations and walk-ins is going to be crucial.”

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