Should restaurants still charge a $100 per person cancellation fee?

It’s a dicey topic. Who should lose out when it comes to last-minute cancellations: the venue or the diner? How much notice is enough? Have your say.

OPINION

For a food writer, I don’t eat out as much as I should.

I blame my toddler. Sure, we visit cafes and local pizza places. But the sort of restaurants I write about for delicious. are few and far between, because spending $30 an hour on a babysitter, on top of the meal, puts a brake on things.

So when a friend generously offered to babysit said toddler for an afternoon, I booked my husband and I in for a fancy lunch. It was our first date in over a year. I was excited, but also anxious.

Restaurants charge cancellation fees and ask for upfront payments to avoid diner no-shows which end up costing them thousands. Co-owner Karla Munoz Labart at her restaurant Labart in Burleigh Heads. Picture: Nigel Hallett

Thinking of cancelling was bad enough, thinking of losing my booking deposit was worse. Covid highlighted why credit card holds and deposits were necessary, but what about diners who genuinely have to cancel at the last minute?

Deposits and prepayments vary wildly. It’s not uncommon for a restaurant to charge a $100 cancellation fee per person, which the restaurant is entitled to keep should you cancel without the requisite notice – even if they do end up filling the table later on.

How much notice is enough?

It’s a question Attila Yilmaz of Pazar Food Collective asked his hospitality peers over Instagram. A group of eight cancelled last minute and refused to reschedule. He has their credit card pre-authorisation, what would other restaurateurs do?

“We are told to accept Covid as the new normal. Are restaurants expected to wear the cost of cancellations?” he asked.

Owner and head chef Attila Yilmaz of Pazar Food Collective. Picture: AAP/Matthew Vasilescu

Pazar Food Collective, which serves a variety of food ranging from Turkish to Asian, is among the top restaurants in NSW. Picture: AAP

Speaking to delicious., he says he has been taking credit card pre-authorisation for six years. Occasionally, he removes it as an experiment and finds his no-shows can be up to 40 per cent.

“As long as we can fill that table, I won’t charge, but I want to know what everyone else is doing,” he says.

Tristan Rosier, executive chef of Arthur and Jane restaurants, agrees that charging late-cancelling diners is a last resort.

“You’re not going to be charged if you give the appropriate notice or contact us within a time frame where we can fill the seats,” he says.

Tristan Rosier at his Surry Hills restaurant Jane with head chef Victoria Scriven. He believes charging people for cancelling their reservation is a last resort. Picture: Jonathan Ng

Restaurateur Anna Pavoni of a’Mare, Ormeggio and Chiosco says diners “understand the ‘why’ but it’s the how that is a challenge”.

The Crown complex, home to a’Mare, recently decreased its cancellation period to 12 hours. Ormeggio is still 24 hours and takes credit card details as security.

“We have to order food in advance and we need to roster in advance. Taking details deters the ‘Let’s book three places and see how we feel on the night’ people,” Pavoni says.

She believes it’s a balancing act of being hospitable and businesslike.

The a'Mare restaurant at Crown Casino. Picture: Supplied by Crown

“The questions we have to ask are can we refill the table/reuse the stock/re-roster the team/afford to lose the cash flow?” she says.

“For example, Ormeggio is not a walk-in kind of place. We had a buyout function the other week, which was a big deal. On the morning of the event the birthday girl got sick. The guest was in tears, my events manager too. My fridges are full, my staff have arrived and it’s the lowest point of our year, being cold and wet.

“There is a contract signed specifically to deal with this kind of thing. Whose responsibility is it to wear the financial burden?

“We took it on the chin, as usual. We moved the date, forfeited 25 per cent of their food expenditure to cover our purchases and the rest rolls over to their new date. We had an empty restaurant on a Saturday and cash flow for the week suffered.

“Hopefully the guest appreciated it, perhaps understood it was a sacrifice on our side and maybe told people what a great venue we are. That’s basically why we do it in the end, word of mouth is still imperative to our success.”

The delicious. 100 is back for 2022! Look for the list online from Friday afternoon, or pick up a copy of The Daily Telegraph this Saturday, July 30 and check out the Sydney Weekend magazine to discover 50 of the best, most exciting, generous, innovative and delicious restaurants in your state. Next week, look the full list of the delicious. 100, and NSW’s best restaurant for 2022.