Thoughtful booking: non-refundable hotel rates could be introduced in 2025
The Ministry of Economic Development expects that non-refundable tariffs in Russian hotels will be introduced at the legislative level in 2025. This was announced by Deputy Minister of Economic Development of the Russian Federation Dmitry Vakhrukov. This type of booking is proposed to be introduced on a par with refundable, so that the tourist has the right to choose based on his preferences and situation. This will allow to keep the balance of interests of tourists and business. How the innovation may affect tourist flows and whether the cost of accommodation in Russia may change - in the material "Izvestia".
Response
Representatives of the hotel business and industry associations have repeatedly appealed to the Ministry of Economic Development with the initiative to introduce non-refundable booking, reported "Izvestia" in the Ministry. Such booking is proposed to be launched on a par with refundable booking.
"Non-refundable booking, on the one hand, will increase the profitability and utilization of hotels, reduce downtime, and on the other - will allow the tourist to save money. The traveler will get a choice: to save on the cost of accommodation in case the trip will definitely take place and choose non-refundable booking, or to book a room at a higher price, but have the possibility of cancellation," - specified in the ministry.
Often tourists book several means of accommodation for one date, and then choose the most convenient option without canceling the others. As a result, hotels incur losses when canceling reservations without advance notice.
"Currently, the bill has been submitted to the government, at the beginning of the year it is planned to submit it to the State Duma," - said in the Ministry of Economic Development.
For customers and businesses
The availability of an alternative in the form of non-refundable booking rates, on the one hand, will allow tourists to save money on accommodation services while traveling (for example, non-refundable airline tickets are always cheaper), and on the other hand - to improve the hotel management process and ensure dense occupancy of rooms, says Alexei Korneev, founder of Timjet.
- Non-refundable booking will cover the hotel the risk of refusal of accommodation, if no one else can be accommodated, and will provide additional profit, if tourists are still found, - said "Izvestia" expert. - At the same time, the innovation will require from the hotel business and certain costs. Firstly, for re-flashing the existing software so that the system could support the new function and prevent accidental or intentional change of data, fraught with problems and proceedings. And secondly, to pay for quick booking services, as they will also have to incur development costs, which they are expected to pass on to users, i.e. hotels themselves.
Such practice has long been widespread abroad, noted Alexander Shepelev, an expert on the stock market of "BKS Investment World".
- In case of realization of the initiative Russians will have a choice - to pay a smaller amount for accommodation, agreeing that the money will not be returned in case the trip did not take place, or in case of lack of full confidence in the trip to insure and pay the standard rate, preserving the possibility of refund. In turn, hoteliers will be able to reduce their costs and plan their business with more confidence. It is obvious that such non-refundable tariffs should be lower, we can talk about discounts of 10-25%, - said "Izvestia" Alexander Shepelev.
Vacation destinations
On tourist flows this innovation will not affect in any way, believes the head of the professional commission of the Moscow Association of Travel Agencies (MATA), senior lecturer of the department "Management in the hospitality industry" IOM Presidential Academy Alexander Preobrazhensky.
- For hoteliers it is quite an obvious protective measure, which is designed to protect them from losses for booked, but not demanded services. Often a reservation is canceled in such a short period of time that the hotel does not have time to resell the room. Non-refundable tariffs will help to avoid such costs, which will support the industry, " the expert said in a conversation with Izvestia.
Tourists, according to him, will just need to be more careful in planning their trip. In addition, this measure will save money, as non-refundable fares are always cheaper than regular fares - this can be seen in the airline industry, where such fares have been used for years.
Changing the context
At present in Russian hotels there are two conditions of room booking: guaranteed and non-guaranteed, which are fixed in the contract on rendering services, Alexey Chudnovsky, Doctor of Economics, Professor, Head of the Department of Management in International Business and Tourism Industry of GUU, told Izvestia.
- Under the terms of non-guaranteed booking, the contract between the hotel company and the client is terminated if the hotel has not received payment or payment guarantees by a certain date. Guaranteed reservation implies the introduction into the contract of conditions on partial or full payment for services and the indication of the terms of the beginning of service or arrival of the guest, - he emphasized. - According to the current rules of hotel services in Russia, if the client does not receive timely information about the new time or date of arrival, the hotel company has the right to charge a fee for the idle room, but not more than for a day of stay.
The service contract must comply with the consumer protection legislation, according to which the client can withdraw from the contract at any time and the provider will have to refund the money. Only expenses already incurred, which must be documented, are excluded.
Charges for utilities or room downtime (lost profit) can not be withheld.
- Thus, if the client refuses the hotel services or does not check into the booked room, the company will lose income. Urgent search for new clients is a troublesome and costly business. In this situation the interests of hoteliers can be protected by a non-refundable tariff, - he noted.
The Ministry of Economic Development has prepared a bill designed to legalize the condition of booking, in which the client can not return the full cost of accommodation, if he canceled the reservation (order confirmed by the hotel) without a valid reason.
- Valid reasons include failure to fulfill stated services, pandemic, new government requirements for tourists, canceled flights, etc. To introduce non-refundable rates in hotels and hotels at minimum prices was proposed by Rostourism in amendments to the law on tourism back in late 2021. The idea was supported by the Russian Union of Travel Industry (RST), noting that the application of such a tariff will minimize the risks of under-booking from accommodation facilities and reduce the cost of accommodation by 10-15%, - said Alexei Chudnovsky.
Non-refundable tariffs in the format of a promotion for the sale of a certain number of seats are already used by air and rail carriers. That is why it is important to explain to clients how such tariffs work so that there would be no misunderstandings and disputes.
As a result, hotel companies will be able to offer customers lower prices for their services at a non-refundable rate.
- Such conditions are designed for customers who are confident that nothing will disrupt their plans and agree to lose money in case of breach of booking conditions. This is favorable for hotel companies, it helps to maintain revenue and room utilization on certain dates, for example, in periods of low utilization, - concluded the expert.
