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The table was booked, nobody came, and no-shows quietly take your currency off your month.
How much does a no-show cost me each month, and when is it worth asking for a deposit?
A no-show costs you the money that seat would have taken, minus the food you never cooked: bookings a month, times your no-show rate, times guests per booking, times spend per head, then take off your food cost share. Asking for a deposit is worth it once that lost amount is bigger than the few bookings you may scare away, and the deposit per head should be at least the lost money divided by the number of guests who fail to show.
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This is the money that walked out the door before anyone sat down.
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Continue with my numbers Free · no card · 20 messages a dayHow it is calculated
- Count how many bookings you take in advance in a normal month.
- Multiply that by your no-show share to get the bookings that never turn up.
- Multiply by the guests per booking to get the empty seats.
- Multiply the empty seats by what a guest normally spends: that is the lost sales.
- Take off your food cost share, because that food was never bought or cooked. What is left is the real loss.
- Multiply the empty seats by the deposit you would ask, to see how much you would hold on to.
- Divide the real loss by the number of empty seats to find the deposit per guest that covers it fully.
- Sales lost to no-shows each month = Bookings taken in advance per month × Share of those bookings that never turn up ÷ 100 × Average guests per booking × Average spend per guest
- Money left in your pocket that you lost = Sales lost to no-shows each month × (1 - Food cost as a share of the bill ÷ 100)
- Deposits you would keep each month = Bookings taken in advance per month × Share of those bookings that never turn up ÷ 100 × Average guests per booking × Deposit you would ask per guest
- Deposit per guest that covers the whole loss = Money left in your pocket that you lost ÷ (Bookings taken in advance per month × Share of those bookings that never turn up ÷ 100 × Average guests per booking)
An example
Bookings taken in advance per month: 500 bookings · Share of those bookings that never turn up: 8 % · Average guests per booking: 2 guests · Average spend per guest: 30 your currency · Food cost as a share of the bill: 32 % · Deposit you would ask per guest: 15 your currency.
Result: Sales lost to no-shows each month: 2,400.00 your currency · Money left in your pocket that you lost: 1,632.00 your currency · Deposits you would keep each month: 1,200.00 your currency · Deposit per guest that covers the whole loss: 20.40 your currency.
Worth keeping in mind
- Food cost varies a lot by kitchen. Check yours from last month's invoices instead of using an example figure.
- Recorded no-show rates are often low, around two or three in a hundred, but houses with no policy report far higher. Use your own booking book.
- A cancellation made a few hours before is almost as costly as a no-show. Count those in too if you can fill the table.
- Deposit rules differ by place. Say the amount, when it is refunded and when it is kept, before the guest pays, and get their agreement.
- Some guests book elsewhere rather than leave a card. Test a deposit on peak nights and large tables first.
Sources
Text drafted with the assistance of artificial intelligence, from the sources listed, and checked against the worked example. It is a tool for orientation: for tax or contractual decisions, your accountant has the last word.
How this page came about
Nobody wrote it by hand. Oravio built it on its own.
- It looked for the sources and opened them one by one: the ones that do not answer never get in.
- It wrote the formulas and tried them on a worked example: if the maths does not add up, the page never goes out.
- It laid the page out and put it online all by itself, with nobody touching a key.
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