The Effect of No-Shows on SME’s

Cameron Calder

Posted on

March 7, 2022

Cameron is QZee's CEO and Co-Founder. He & his team founded QZee with the goal of devising a smart, deposit free solution to the problem of no-shows and last-minute cancellations, which is costing UK businesses billions of pounds every year.

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https://www.walesonline.co.uk/whats-on/food-drink-news/north-star-maindy-cardiff-book-20664948

Another example of how no-shows can be devastating for businesses…

On the first Sunday, after the hospitality business was allowed to operate indoors, 34 guests failed to show up for their reservation at this Cardiff pub and restaurant. The company had to turn away an extra 50 consumers since the bookings may still have shown up for their slot, the business has no real way of knowing in advance with a traditional system. This presents a considerable loss of money for this business, which relies on reservations to turn up.

Reservations give a company a better chance to plan ahead by purchasing stock and hiring more employees. Businesses rely on these reservations being honoured. The vast majority do, which is fantastic. However, 1/4 do not; deposits can compensate for lost revenue, but these slots are still unfilled. Unfortunately, as demonstrated in the article, any business that does not have a countermeasure for no-shows is extremely vulnerable. On average, it is 1/4, but it could be 1/3 or 1/7 on any given day. Yes, unfortunately, it is unpredictable, difficult to manage, and severely impacts businesses. Busy days are often the worst for this. With thousands potentially being lost in customers turned away, over purchased stock & empty tables.

The North Star in Maindy, known for its Sunday roasts, expressed its displeasure on social media after having 34 no-shows in one day; because the business wasn’t warned, these tables were saved, and another 50 customers were turned away at the door. Let’s say each customer spends £30 on average. This totals a loss of £2.5k in one day. This is absolutely a massive problem for businesses, and unfortunately, it disproportionately affects smaller enterprises. The problem with no-shows amounts to an annual loss of £17,6 billion in the UK hospitality industry alone, a massive loss for a sector that has already struggled immensely in recent years.

These no-shows are turning businesses towards pre-payments & deposits which can solicit a mixed reaction. Don’t rely solely on these systems, give yourself options. We like to work with flexible deposits & our mapping algorithms. More can be found out about flexible deposits in our development blog.

David Rowlands’s  stated that no-shows were “devastating to our tiny business.” 

 

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