What is cancellation rate? Definition and benchmarks for restaurants

The percentage of confirmed reservations that are cancelled before the dining date.

Cancellation rate is the percentage of confirmed reservations that guests cancel before the reservation time. For restaurants, this metric tracks lost bookings that you may or may not be able to recover. A restaurant taking 80 reservations per day with a 15% cancellation rate loses 12 bookings nightly, though early cancellations can often be backfilled.

Key facts

Definition: Percentage of reservations cancelled before the dining date or time
Formula: Cancellation Rate = (Cancelled Reservations / Total Reservations) x 100
Good benchmark: Under 10% (industry average is 10-20%)
Why it matters: High cancellation rates waste capacity and complicate planning, but unlike no-shows, they offer recovery time

The quick definition

Cancellation rate measures how many confirmed reservations are cancelled before the guest’s scheduled arrival. Unlike no-shows, where guests simply fail to appear, cancellations give the restaurant advance notice and time to fill the table. The distinction matters: a 20% cancellation rate is far less damaging than a 20% no-show rate because cancellations can be recovered.

Cancellation Rate = (Cancelled Reservations / Total Reservations) x 100

Example: If you took 500 reservations last week and 75 were cancelled, your cancellation rate is 15%.

Why cancellation rate matters

Capacity planning

Cancellations create uncertainty in your nightly covers. A restaurant expecting 100 reservations with a 15% cancellation rate needs to plan for somewhere between 85 and 100 guests, which affects:

Food prep quantities
Staffing levels
Ingredient ordering
Revenue projections

Recovery opportunity

The key difference between cancellations and no-shows is time. A cancellation at noon for a 7pm reservation gives you 7 hours to fill that table. Track your recovery rate alongside cancellation rate:

Cancellation Timing	Recovery Rate
48+ hours ahead	80-95%
24 hours ahead	60-80%
Same day	30-50%
Within 2 hours	5-15%

Revenue impact

Even with partial recovery, cancellations cost revenue:

Example for a 60-seat restaurant:

80 reservations per night, 15% cancellation rate = 12 cancellations
60% recovery rate = 7 tables refilled, 5 lost
At $50 average check per cover: $250-500 lost daily
Monthly impact: $7,500-15,000

How to calculate cancellation rate

Basic calculation

Cancellation Rate = (Cancelled Reservations / Total Reservations) x 100

Example:

Total reservations this week: 400
Cancelled reservations: 52

Cancellation rate = (52 / 400) x 100 = 13%

By timing

Break down cancellations by when they happen:

Window	Count	% of Cancellations
48+ hours	22	42%
24-48 hours	12	23%
Same day	13	25%
Within 2 hours	5	10%

Early cancellations are manageable. Late cancellations need attention.

Combined loss rate

For a complete picture, track cancellation rate alongside no-show rate:

Total Loss Rate = Cancellation Rate + No-Show Rate

If your cancellation rate is 13% and your no-show rate is 8%, your total loss rate is 21%. That means roughly one in five reservations does not result in a seated guest.

What’s a good cancellation rate?

Restaurant Type	Typical Range	Target
Fine dining (with deposits)	5-10%	Under 8%
Upscale casual	10-15%	Under 10%
Casual dining	12-20%	Under 12%
High-demand locations	8-15%	Under 10%
Large party bookings	15-25%	Under 15%

Restaurants that require deposits consistently see lower cancellation rates. The deposit creates commitment that casual bookings lack.

How to improve your cancellation rate

1. Make cancellation easy (yes, really)

This sounds backward, but it works. When cancellation is hard, guests default to no-showing. When it is easy, they cancel early enough for you to recover:

One-click cancel links in reminder messages
No phone calls required
24/7 online cancellation
Friendly confirmation when they cancel

Your goal is converting no-shows into early cancellations.

2. Send smart reminders

Automated reminders serve two purposes: they confirm committed guests and prompt uncertain guests to cancel:

48-hour reminder: “Looking forward to seeing you Friday at 7pm. Need to change plans?”
Day-of reminder: “Your table is ready tonight at 7pm. Confirm or cancel with one tap.”

Restaurants using automated reminders typically reduce combined cancellation and no-show rates by 30-40%.

3. Use deposits strategically

Deposits do not eliminate cancellations, but they dramatically reduce casual, speculative bookings:

Booking Type	Deposit Approach
Peak nights (Fri/Sat)	$25-50 per person
Large parties (6+)	$25-50 per person
Holidays and events	$50-100 per person
Regular weeknights	No deposit needed

Refund deposits in full when guests cancel within your policy window. Apply to the final bill for guests who show.

4. Maintain an active waitlist

A strong waitlist turns cancellations into a non-issue:

Text waitlisted guests immediately when spots open
Give a 15-30 minute response window
Keep the waitlist populated during booking
Track waitlist conversion rates

5. Analyze patterns and act

Look for trends in your cancellation data:

Which days see the most cancellations?
Which booking channels have higher rates?
Do large parties cancel more often?
Are certain time slots more volatile?

Use these patterns to apply deposits or overbooking selectively rather than blanket policies.

No-show - A guest who fails to arrive without cancelling, the worse outcome compared to a cancellation
Booking lead time - Time between booking and dining, longer lead times correlate with higher cancellation rates
Reservation deposit - Upfront payment that reduces both cancellation and no-show rates
Waitlist - The recovery mechanism that fills cancelled tables with waiting guests

Frequently Asked Questions

What is a normal cancellation rate for restaurants?

Most restaurants see cancellation rates of 10-20%. Fine dining with deposits tends toward 5-10%, while casual dining without deposits can run 15-25%. Under 10% is generally considered well-managed.

Is a cancellation better than a no-show?

Much better. A cancellation gives you time to fill the table through your waitlist or walk-ins. A no-show leaves you with an empty table during service. Make cancellation as easy as possible to convert potential no-shows into recoverable cancellations.

Do cancellation fees actually work?

Yes, but they work best as a deterrent rather than revenue. A clear cancellation policy with a reasonable fee (often waived if cancelled 24+ hours ahead) reduces casual bookings by 20-30%. The goal is fewer frivolous reservations, not collecting penalty fees.

How far in advance do most cancellations happen?

About 60% of cancellations happen more than 24 hours before the reservation. Another 25% happen same-day. The remaining 15% are last-minute, within 2 hours of the reservation time. Earlier cancellations are easier to backfill.

Should I overbook to account for cancellations?

Strategic overbooking works if done carefully. If your combined cancellation and no-show rate is 15%, booking 5-8% above capacity is reasonable. Start small, track results, and always have a backup plan like bar seating when everyone shows.

Track Your Restaurant Metrics

Understanding cancellation rate is just the start. Resos helps you track covers, manage tables, and grow your restaurant.

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