One of the strictest policies that I find on most B&B websites is the length of time for the cancellation policy. We had so few cancellations here with only 5 rooms and had a 72 hour policy. I think that there are probably folks who aren't booking at B&Bs because of these 7-14 day cancellation policies for just regular bookings. I'm sure the flak will fly over me posting that..
I still think that absence of proof is not proof of absence in this case. You have no idea how many people are leaving your site because of a lengthy cancellation time. I know that I'm definitely one of them and I've never had to cancel a B&B rez yet. jmvvho.
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But if they have an occupancy rate where they want it to be - it doesn't matter how many move on. IF they have all the business they are comfortable with.....
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That's very true. But increased demand means higher room rates. With higher room rates, you can be even slower if you want to be. The key to getting both the occupancy and the room rate to where you want them to be is always always always always increase demand.
Innkeepers can turn folks away if they want to keep occupancy down. Close rooms off. But restrictive booking policies decrease demand and thus decrease room rates. Never a good plan. IMHO.
Make them want to book so the rates can make whatever occupancy you want to run sustainable. All the profit is in the daily rate so it just, to me, makes no sense at all to do anything that lowers it longterm.
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But revenue reaches a point in an area where it will not fly - no matter what you do. I was referring to the absence of proof. If i had a lot of cancels but that number went down after I instituted a more restrictive cancel policy BUT my rez numbers stayed up there, I would look at it as a winner. In my area, I believe higher rates would hurt me more than help. I have raised them over the years to what I believe is my price point now. I am higher than the local chains but then, I have always been very flexible for my guests and their comfort so I get it. I rarely get a cancel either. Right now the rez I took this morning is hoping the saturday rez I took yesterday cancels because he wants ALL rooms for 2 nights. He and I are both going to lose that one. (2 nights revenue instead of 1 - sigh!)
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Most biz guests won't accept a long cancellation period. If a place offers flexible cancellation for them, then that would fly.
Here's the thing: If you're so busy that you're turning away guests, than why would you have a cancellation time frame that is lengthy? You should be able to fill your rooms on a moment's notice. I think innkeepers that hold out on this will lose a segment of the traveling public that they want to convert - the higher end hotel crowd. Just my 2 cents after listening to rants from plenty of friends that travel a lot and will never stay at B&Bs because of their cancellation policies for leisure travelers. I guess if it's working for folks and their occupancy is consistently
way up there, that's great. More flak will come my way, I'm sure. haha!
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Again, it really depends on your location. If you're not in a city or metro area, cancellations can kill you. Our reservations are not usually last minute. People plan for their trips here. If someone cancels even within a few days, I will not typically be able to fill that room again even though we have have a high occupancy rate. People who come to my area in peak season plan their trips in advance. If they didn't, they very often wouldn't be able to get any room last minute. When you're off the beaten track, you depend on your website for reservations, not drive bys or referrals.
We don't have biz travelers, but if I were in a city, I would have a biz rate with a biz cancellation.
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Breakfast Diva said:
Again, it really depends on your location. If you're not in a city or metro area, cancellations can kill you. Our reservations are not usually last minute. People plan for their trips here. If someone cancels even within a few days, I will not typically be able to fill that room again even though we have have a high occupancy rate.
Breakfast Diva, you're totally right that much depends on the location. For a remote inn, last minute bookings may not be convenient in and of themselves if the innkeeper can't get out to buy food/supplies. There are lots of reasons that remote inns may have different requirements.
But even though there may be good reasons for a longer cancellation policy and even though it would mean that you would occasionally get a cancellation you couldn't rebook, I still think most inns would benefit from a 3-day cancellation policy. Shorter if possible.
Some guests just won't book if the cancellation policy is restrictive. By not getting all the guests you could, you're restricting demand. While there are some limits as to how far rates can be raised in a given area, even a small increase can help the bottom line significantly.
I'm not saying all inns should do this. Again, some remote inns have good reasons for their policies.
But most inns would, over time, make more money with a shorter cancellation policy than with a lengthy one.
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