Modeling no-shows, cancellations, overbooking, and walk-ins in restaurant revenue management

Sze Ming Tse, Yiu Tung Poon

Research output: Journal article publicationJournal articleAcademic researchpeer-review

9 Citations (Scopus)

Abstract

Few studies have examined overbooking in the restaurant industry. The authors observed the business situation in a restaurant in Hong Kong over 2 years, noted how demand exceeded supply on a regular basis, and analyzed the reservation data. The reservation data were used to estimate the no-show/cancellation probability and walk-ins for lunch and dinner on different days of the week, to illustrate the model, and to arrive at the optimal booking limits. A conceptual model was developed which would take into consideration the business situation, no-shows, cancellations, and walk-ins to determine the booking limit for maximizing the expected total revenue.
Original languageEnglish
Pages (from-to)127-145
Number of pages19
JournalJournal of Foodservice Business Research
Volume20
Issue number2
DOIs
Publication statusPublished - 15 Mar 2017

Keywords

  • Cancellations
  • no-shows
  • overbooking
  • restaurant revenue management
  • walk-ins

ASJC Scopus subject areas

  • Food Science

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