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No-shows wreaking havoc on restaurant business

25 Comments

For most, the bonenkai (year-end party) season is now no more than an alcohol-befogged memory. But some -- restaurant operators in particular -- are still feeling the pain. According to figures cited in Shukan Jitsuwa (Dec 27), last-minute cancellations of reservations, mostly by groups, are estimated to cost the food and beverage industry some 200 billion yen is losses per year.

"Over the past several years, the number of customers who make reservations via the web, but who don't show up, have been increasing," a restaurant operator told the magazine. As a result of the no shows, the food ingredients, particularly if they are to be served as part of a set course, often must be discarded and written off.

And even if the reservations are only for a single table, the reserved table must be kept open for the customers, which means other arrivals can't be seated there without some risk.

"We've had reservations for 40 people cancel at the last minute," sighed the manager at a major restaurant chain. "There are also other cases when the number of people who did show were half or even fewer than the number reserved."

"About seven or eight parties a month cancel at the last minute or simply don't show up," one owner-chef told Shukan Jitsuwa. "Since reservations can be easily made via the web, more foreigners have been making reservations, and this also factors into the cancellation problem."

So what are the restaurants doing about it?

"A group of feed and beverage companies at a conference held on Nov 1 agreed on guidelines to the effect that they had the right to demand compensation from customers who cancel without reasonable cause," said the operator of a website that makes restaurant reservations. "The letter of the law may treat such cancellations as a breach of promise or violation of the law. Our thinking is that even if a restaurant wins just one case in court, it will have the effect of reducing the number of abuses."

A follow-up article in Shukan Jitsuwa's Jan 3 issue sees the problem of last-minute cancellations as one of manners.

Take reservations at high-class sushi restaurants.

 "Our shop procures fish from the market after reservations are made," said the operator of a sushi shop in Ginza. "And we beg off on any other requests for reservations. So no-shows definitely hurt the bottom line. Chinese customers have turned out to be problematic, so we've stopped accepting reservations from them."

It seems that three years ago, a famous sushi restaurant in Ginza that had received a three-star rating from the Michelin guidebook flatly refused reservations from a Chinese journalist.

"At that time we began hearing accusations of being biased," the Ginza source said. "But we're in business to make money. I don't think it should be necessary to accept reservations from customers who pose that kind of risk."

One way some restaurants have found for reducing the risks is to refuse reservations from foreigners unless they are requested by the concierge at their hotel, or made from a credit card company.

"Even then, no-shows by Chinese customers are rampant," said the operator of one well known establishment. "One day, trying to please everybody, he set the reservation time for a large group of Chinese so as not to interfere with other customers, but as luck would have it nobody showed up that evening and sales for the day wound up as zero."

To protect themselves, more shops have been requesting the credit card number of the customer who makes the reservation and charging the full amount in the case of a no-show.

"This is a problem even inside China, and campaigns have been conducted by the government in the mass media appealing to Chinese people not to embarrass their country when traveling abroad," a Japan-based Chinese journalist told Shukan Jitsuwa. "But I think it's going to take Chinese another couple of decades before they catch up with people in economically advanced countries."

© Japan Today

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25 Comments
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I saw that American Express purchased Pocket Concierge in Japan yesterday, so the concept of holding diners to account for short-notice cancellations must be proving relatively successful!

5 ( +5 / -0 )

Wow. Discriminating much??

I wish to all those ‘selective’ restaurants happy bankroupcy and loose of business. Discriminating based on nationality should be punisable by law in any civilised country.

0 ( +0 / -0 )

"Since reservations can be easily made via the web, more foreigners have been making reservations, and this also factors into the cancellation problem.

 "Our shop procures fish from the market after reservations are made," said the operator of a sushi shop in Ginza. "And we beg off on any other requests for reservations. So no-shows definitely hurt the bottom line. Chinese customers have turned out to be problematic, so we've stopped accepting reservations from them."

It seems that three years ago, a famous sushi restaurant in Ginza that had received a three-star rating from the Michelin guidebook flatly refused reservations from a Chinese journalist.

"At that time we began hearing accusations of being biased," the Ginza source said. "But we're in business to make money. I don't think it should be necessary to accept reservations from customers who pose that kind of risk."

Yeah, we all know what this means: The problem lies with foreigners, especially the Chinese. Japanese do it and it's a minor inconvenience. Foreigners do it and it becomes a major problem. How about some stats to back up their claims? This article is rife with instances that show how bias and racism work in Japan on a daily basis. No real change is coming soon, either. Pathetic. I hope they all go out of business.

-3 ( +4 / -7 )

Euro Dude,  I disagree.  If a restaurant keeps getting screwed mainly by Chinese (or any other particular nationality) odds are the restaurant will return the favor by screwing them out of reservations since they are likely to flake again compared to a known client.  Don't get butt hurt, its Japan.  People have the option to take their business somewhere else and everyone is happy.

6 ( +12 / -6 )

Deja vu?

I wonder if this was written by the same person: https://japantoday.com/category/features/kuchikomi/last-minute-cancellation-by-chinese-tour-groups-driving-businesses-crazy

3 ( +3 / -0 )

Excuse me, there are many types of people in the world, Why just pick on the Chinese ???. Chinese is also of many levels just like Japanese. Japanese goes to China or the rest of the world , thinking they have status and money and they can do what they want. Are all Japanese like that ???. On one hand , japan wants profit but Japan wants to look for problems by single out Chinese customers without checking , what kind of level these kind of Chinese are ???. Japanese makes reservations and do not turn up too. The world is not like Japan. one Size fits all. O.k. from now on , I will recommend to all my Good level Chinese friends from all over the world , not to go to any Japanese restaurants or famous eating places in Japan. Good luck to small minded operators in the food business.

-5 ( +4 / -9 )

So stop allowing them to make reservations online without putting down a deposit based on the number of guests on a credit card. If no deposit is paid by a certain deadline, the reservation is forfeit. Within x amount of time before the event, the cost of cancellation goes up. No-shows get charged full price. Not rocket science.

17 ( +17 / -0 )

Common sense @expat

I agree with you,same ordering pizza or taxi, but much bigger money with Restaurant

4 ( +4 / -0 )

"Since reservations can be easily made via the web, more foreigners have been making reservations,

As soon as I read that line, I knew how this article would end up.

What started off as an article about something committed by people from all countries including Japan ends up as another rant against foreigners. Moan moan moan. Good lord. Either do something like get their credit numbers in advance, or just shut up. I wonder whether these restaurants discriminate against Japanese customers just because some Japanese groups cancel. I thought not.

May I add that the mainland Chinese can also spend A LOT! Someone I know back home works in a Chinese restaurant and they get loads of customers from mainland China. And they are willing to pay A LOT. Dare I say it, but they are getting ripped off too!

-2 ( +4 / -6 )

Stupid article, I hope that doesn't mean refusing foreigners' reservations will catch on and become a thing in the future....

Also I wonder who makes the majority of reservations for larger bonenkai? Wouldn't it be companies rather than individuals?

2 ( +4 / -2 )

Charge for cancellations. Don't take bookings online. Many restaurants in the UK take credit card details for large bookings and automatically charge you if you don't cancel with reasonable notice. It's all to easy to book online then decide to go elsewhere.

9 ( +9 / -0 )

A non-problem, easily solved with a jot of commonsense .....

5 ( +5 / -0 )

The airline industry has mastered this craft - and their cancellation policy is based on numbers - not ethnicity. Data Analytics can show the rate of cancellations on a given number of bookings on any given day - if they are sly, (they can even use IP address) to see where the booking came from. Point is, the technology is there to fix this issue without being racist. At 200billion yen losses a year they could have created an IT team to provide solutions.

-2 ( +0 / -2 )

"IT team to provide solutions." But could a small restaurant afford an IT team?

1 ( +2 / -1 )

"At that time we began hearing accusations of being biased," the Ginza source said. "But we're in business to make money. I don't think it should be necessary to accept reservations from customers who pose that kind of risk."

Well said.

-1 ( +3 / -4 )

Going after people who made the reservation after the fact seems like such a stupid way to go about things. Just require a credit card for booking and that'll solve all your problems, I guess the only issue would be that people would just book somewhere else, but if this group of restaurants all agree to do so then eventually it'll be accepted as the new normal.

3 ( +3 / -0 )

Japan, still behind on this already solved problem?

Japan also needs more clear online sites with English.

0 ( +0 / -0 )

It's the sign of the times.

Money is tight.

0 ( +0 / -0 )

I have been denied a reservation at a popular izakaya based on where I was from. I asked our concierge to make the reservation and he called back saying that they don't take reservations from foreigners. Didn't matter that I have a Japanese last name...but since I was American I was refused. BUT, I do understand their dilemma.

0 ( +0 / -0 )

Online reservations should easily be taken with a credit card added. Otherwise the establishments are opening themselves up to pranks and careless no-shows, regardless of their IQ, race or nationality.

0 ( +0 / -0 )

To protect themselves, more shops have been requesting the credit card number of the customer who makes the reservation and charging the full amount in the case of a no-show.

They ARE taking reasonable steps. Too many people here haven’t read the article properly.

0 ( +1 / -1 )

Foreigners, at least tourists, may be seen as one-time customers. I suspect there are also frequent cancellations from groups at nearby offices. People in offices are often forced to work late and can cancel a party because work is more important. Charging locals for no-shows leads to a loss of future business.

Foreigners are a soft target.

1 ( +2 / -1 )

Some restaurants also just have a no reservations policy. That should work. First come first serve. In the case of a set course for a very large group the restaurants my company uses definitely have a cancellation penalty.

0 ( +0 / -0 )

I hope this blanket discrimination gets into travel magazines and discourages people from spending money in Japan. How much has Japan been raking in, again, lately?

0 ( +0 / -0 )

I wish to all those ‘selective’ restaurants happy bankroupcy and loose of business. Discriminating based on nationality should be punisable by law in any civilised country.

Agreed and giving this an upvote by post as there be glitches... it's not so far removed from the bad old days of "no blacks, no dogs, no Irish".

1 ( +1 / -0 )

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