The Era of ‘No-Show’ Fees Is Here—and It’s Going to Cost You

Don’t be a flake. Your salon, personal trainer or housecleaner might send a bill if you are. Harbor Barber owner Greg Krupa didn’t mind losing a few customers because of his no-show policy.

By Imani Moise of The WSJ. 

This article reminded me of opportunity cost (the value of the best foregone alternative). Trainers and barbers could be doing something else with their time and if you don't show up they lost an opportunity to schedule someone else.

Excerpts from the article:

"businesses . . . [are] charging for not showing up."

"Harbor Barber . . . owner Greg Krupa had to go digital to stop no-show customers from trimming his profits."

"These days, missing an appointment can cost customers up to $100—double the price of a normal haircut."

"fees for flaking on appointments are spreading to salons, personal trainers and beyond. More beauty professionals charge cancellation fees, reaching 16% on Square’s payment platform last year, up from 5% in 2021. Restaurants on reservation platform Resy that charged at least one cancellation fee more than quadrupled from 2019 to 2024. 

Technology that streamlines booking and payments has made it easier to track late arrivals and no-shows. Many of the platforms are normalizing fees that help small businesses turn the tables on flakes. 

Square, which advertises these features, allows businesses to charge up to $500 for cancellations. StyleSeat, a booking platform for cosmetologists, lets stylists and makeup artists choose flexible, moderate or strict cancellation policies, which can charge customers up to 100% of the service price for cancellations with less than 24 hours’ notice. Wyzant, a platform for tutors, asks users to set their cancellation policy as part of creating an account."

"Since January 2020, the share of barbershops on Squire that collect payment information in advance has increased 43%. As a result, shops see 45% fewer cancellations and 82% fewer no-shows, according to company data."

"Some customers say the practice unfairly punishes them when life gets in the way of plans. Adding to the pain: They have little recourse when providers cancel on them."

"Businesses tend to tighten up cancellation policies during economic downturns, said Karen Xie, an associate professor of business-data analytics at University of Connecticut’s business school. That’s why many companies raised fees and shortened rescheduling windows during the pandemic. 

Fines don’t always reduce undesired behavior. One famous case study by economists Uri Gneezy and Aldo Rustichini found that when a daycare center imposed a fee to stop parents from picking up their children late, late pickups significantly increased. Setting a price for tardiness seemed to make the practice more acceptable, and turn the staff’s time into a commodity, the 2000 report published in the Journal of Legal Studies said."

"Gail Gallaher, a science and test-prep tutor . . . [said] Her policy of charging last-minute cancellations or no-shows 50% or 100% of her normal rate helps keep prices lower for clients who keep their appointments"