Late hotel cancellation could cost more than you bargained for

New hotel cancellation policies have corporate travellers up in arms as penalties are now due for cancellations two days prior to travel.

Hotel chains, including Marriott International and Hilton, recently announced that they would be introducing minimum timeframes for the cancellation of a booked hotel stay.

Marriott was the first to introduce the new policy, announcing that it would implement a 48-hour cancellation policy across all brands in the United States, Canada, the Caribbean and Latin America. Guests booked with any of the brands who omit to cancel within the given timeframe will be charged a penalty equivalent to one night’s stay at the hotel.

Hilton was quick to follow suit, proposing updating the default house cancellation policy to 48 hours for its managed properties. The difference with Hilton, though, is that the new policy would affect Hilton hotels in the United States and Canada for new bookings from the end of July and franchised hotels can opt out of the policy if they choose, while some hotels in busy cities or resort areas may require 72 hours’ notice to cancel.

“Business travel can be unpredictable to say the least. Meetings overrun or are postponed, flights get delayed and even cancelled. Being agile in a business travel environment is important, but sometimes your ability to do so is limited by the rules of the game, which change from time to time,” explains Ryan Potgieter, Flight Centre Business Travel gm.

While the decision has been criticised widely, it does ultimately make business sense for hotel groups, says Potgieter.

“When you really think about it, hotel rooms are consumable products. If there are no-shows or too many cancellations close to a booked stay, it's difficult for a hotel to recover lost revenue.

“At the other end of the spectrum, these revised policies not only bode well for the hotel groups, but also for travellers requiring last-minute bookings,” adds Potgieter.

As often as scheduled business plans are changed, they are made on the fly too. The revised policies will allow hotels to make rooms available to guests, especially in locations like New York, where occupancy is high and rooms can be scarce.

“While there are pretty much two distinct camps of opinion on the matter, it is something that corporate travellers should get used to, as industry experts predict that other brands will consider their own cancellation policy windows — if they haven't already,” says Potgieter.

Top tips for making the most of new cancellation policies

  • Check your travel policy. Always refer to your hotel brand of choice’s cancellation policy and make sure yours reflects this. Often you may be surprised that even though they have strict measures in place they are willing to compromise, depending on your given situation.
  • If you are in the unfortunate position that your travel plans do change at very short notice and you miss out on the 48-hour grace period, direct a written or in-person plea to the management of said hotel. Even better, if you have a travel management company they would have long-standing relationships with hotels and could motivate on your behalf. Hotels will often be willing to waive cancellation policies under extenuating circumstances. You might be surprised to find that exceptions to policies can be made on a case-by-case basis according to the individual circumstances.
  • Partner with a flexible travel management company, like Flight Centre Business Travel, who have set measures and relationships in place to help avoid added costs for last-minute changes.