Turning cancellations from a headache into revenue

Cancellations are a big headache in the spa and salon business.

They cost you revenue and mess up your schedule, and you can’t avoid them — but you can minimize the damage.

There are several steps you can take to do this, including taking a credit card deposit at time of booking and sending out reminders. But there is no one-size fits all solution. The solution differs from business to business, and even from situation to situation.

Let’s have a look at the steps you can take.

Set parameters

First things first, you must have a policy in place. This doesn’t mean you will always stick to that policy. There are many situations in which you might waver from it, but it’s best to start with something rather than nothing, and to set parameters.

Your policy can get quite granular. Consider different rules for different types of bookings and booking times. You want to maintain your cancellation policy, but still, have some flexibility to show empathy and say “I totally understand that your car broke down.” And communicate that policy to guests. You can’t enforce it if they’re unaware of it.

Use your available resources and tools

Use your own data to track revenue lost through cancellations. With Turn Away Tracking, you can track times with high cancellation rates, equate that to a dollar value, and look at trends.

Then, if you know people are more likely to cancel a Sunday morning 9 a.m. appointment, you might charge a 50% deposit for those specific reservations.

Empower your staff to make decisions

Your front desk staff should be empowered to make decisions such as who is charged for a no-show and who isn’t, without passing it on to a manager or director, and they should be supported in their decisions.

Exercise good judgment, and remember you’re in the guest experience business

Judgement is key. How hard are you going to enforce your cancellation policy if you’re losing $50 revenue on one 45-minute manicure, vs losing $320 on a couples’ massage? Is it worth it? Or, if you’re a hotel spa, you would probably not charge a hotel guest who is already paying $500 a night for a missed $150 massage.

We are in the industry of providing customer satisfaction, so we have to be aware of the line where charging guests for no-shows negatively impact building your customer base.

Find out how Book4Time’s turn-away tracking can support your cancelations, book a demo with us today.

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