Can there be a strategy behind keeping flexible policy? Well, vacation rentals are striving these days and confirming a lot of bookings. However, still, cancellation remains a headache for them and indirectly affects the revenue. Managers' sense of fear regarding flexible policy is critical as they don't want to end up losing the customers.
Cancellation policy relies on many aspects and varies with different industries. Vacation rentals need to have customer-friendly policies so that the customers won't hesitate to visit your property. Small businesses can be possible for small businesses to keep a moderate cancellation policy as more cancellations will lead them to huge losses.
What is the cancellation policy?
Policies contain a set of rules decided with respect if any customer cancels out the bookings. Managers, with their convenience, set the cancellation policies, and customers are bound to pay the penalty if they change their mind after confirming their bookings.
What does non-refundable and non-cancellation mean?
Non-refundable means that there won't be any cancellation once confirmed. In other words, here, the money is not returned no matter whether customers use it or not.
Refundable means the money will be returned after the cancellation of bookings. Here the refundable booking can be made partially or fully depending on the owners' will.
It's crucial to set Cancellation policies according to the situation. And there can be 3 ways:
Flexible cancellation policies
When the guest money is fully returned then, that can be called a flexible cancellation policy. In this pandemic, there is a vast need to imply flexible cancellation policies to affordable vacation rentals. As people might fall into some serious troubles that they haven't assumed.
For instance: Airbnb updates flexible policies temporarily. They provide a fully refundable amount to their guests before 24 hours. Vacation rentals can be known for their cancellation policies if implemented efficiently.
When does a flexible policy work?
When a flexible policy doesn't hinder your revenue: Do you think you will easily adapt to cancellations? When your vacation rental has gained much fame, and you can easily predict a handful of bookings in the future.
Pandemic situations can cause inevitable cancellations that may increase your burden to list and assess cancellations. Besides that, it comfy guests to visit your site and plan accordingly.
Flexible policies during low season: Liberate your policies during low season, so now your business is open to travelers who prefer to visit in the low season.
When you have more loyal customers: Loyal customers are your real customers who will visit frequently. Hence, it can be affordable if you lose some % of customers in one month. Your margin will be balanced, and you won't face any loss.
Forecast the situation and choose the policies that encompass both the guest and owner's mutual benefit
Strict cancellation policy
It's a win-lose situation where the owner is benefited, and the guests suffer loss. Here, the owner charges for cancelling the bookings with a higher amount. The strict policies leave a bad impression on people's minds as people won't lose their money without utilizing the property. The owner needs to scan the environment and apply when needed.
When does strict policy work?
When cancellation causes disruption: Small businesses charge high amounts as they can't afford cancellation, and they need to earn more to expand their business. For them taking a low risk can be affordable
Strict policy during high season: When there is a huge rush at homes for vacation rentals, and at this time, if the guests cancel immediately, you may lose other guests also. The things bungle up if you don't pose strict policies.
Moderate cancelation policy
Moderate cancellation policy may be as safe as the edge of sidewalks on the roadside. It's a win-win situation for both the guests as well as owners. Here, the owners get the charge, and guests have to pay a minimum refund.
Use a trustable payment method like credit cards so that you maintain transparency.
The final takeaway
Cancellation policy is never fun for managers of vacation rentals—however, a hectic task to finish and update with the situation. Keep the above points in mind and cautiously put the strict, moderate, and flexible policy. Port Aransas vacation rentals bestow moderate cancelling policies and a fantastic experience for the guests. Visit the website and book your vacation rental now.
Comments