This study deals with the related issues and problems of hotel reservations, cancellations, no shows, holdovers, early departures, overbooking, oversales, upgrades, walks, and the associated non-performance penalties or compensation. Specifically, we concentrate on non-performance penalties related to late cancellations and no shows, early departures, and walks. Because of the growing importance of the meetings, incentives, conventions, and exhibitions market, special attention is paid to group reservations, group sales contracts, and attrition clauses which penalize meeting planners for not picking up the agreed upon number of blocked room nights. Comparisons are then made with the cruise, airline, and car rental industries. Comparative statistics show that overall, hotels have outperformed the airlines and car rental agencies, but not the cruise lines. We conclude with recommendations for greater efficiencies in managing non-performance penalties or compensation for the hotel industry.
Cite this paper
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