Restaurant Deposits on Reservations: Should You?

It’s a Saturday night, you’ve spent the last few days preparing for a busy night at the restaurant. Table arrangements are set, extra staff has been called in to attend to a large table and a surplus of produce has been bought to cater for the demand.

It’s already 20 minutes past the reserved time, the table for the large party is still sitting empty and panic starts to kick in. Your staff is anxiously waiting for direction, and you can feel their frustration as they watch the clock tick by. You call but there’s no answer. You start to wonder if the reservation was even genuine or if it was just a prank call.

The pitfalls are great! Not only is your staff now idle, but you also have a surplus of food that may go to waste. You’ll have to throw it out if no one turns up, which is a significant loss for your restaurant.

Sadly this scenario will resonate with many restaurateurs all over the world. Inconsiderate guests who cancel at the last minute or don’t show up at all, are a common occurrence.

Solving the no-show dilemma

It is currently estimated that as much as 10% of bookings end up in no-shows. This number is on the increase with the rise in online reservations. Many customers end up reserving tables at a number of restaurants online for the same time and date… they choose to go to one, but “forget” to cancel all the rest.

Cinemas, theaters, concerts… all take pre-payment. So why shouldn’t restaurants take deposits? After all, we also pay in advance when ordering deliveries and take away!

The mentality needs to change to safeguard restaurants from loss of revenue due to no-shows and last-minute cancellations. The pandemic caused enough damage as it is. It should be commonplace for restaurants to charge a deposit on bookings. So let’s break the taboo!

4 advantages of taking deposits

1. By taking a deposit at the time of booking, restaurants can ensure that diners are committed to their reservation and are more likely to show up, as they have invested in the experience.

2. Taking deposits helps to compensate restaurants for the cost of no-shows. When a customer doesn’t show up, the restaurant not only loses out on potential revenue, but they also incur costs such as food wastage, staff wages, and utility bills.

3. Better restaurant management. By knowing in advance the number of guests showing up, restaurants can better manage their staff, inventory, and table availability. This allows them to maximize their resources and provide a better experience for customers who do show up.

4. Lastly, taking advance payment can help to build trust between the restaurant and its customers. When a customer pays a deposit, they are making a commitment to the restaurant, and the restaurant is making a commitment to provide them with a high-quality experience. This can help to establish a positive relationship between the two parties and encourage repeat business.

Start taking deposits with Tableo

While there may be some resistance to the idea of taking deposits, the benefits far outweigh the costs, and it is a small price to pay for a more efficient and profitable restaurant industry.

With Tableo we’ve made it easy for restaurants to:

Set their own booking and deposit policies for customers to see when booking online. (For example, it should be made possible for customers to receive a refund if they cancel 48 hours before).
Accept deposits or pre-payments through Tableo’s Stripe integration.
Take credit card authorisations at the time of booking to secure booking.
Send automatic email reminders ahead of time to allow time for cancellations.