TIP OF THE WEEK: Closing of Bills Before Guest Arrival: Challenges and Considerations

  • 25 July 2023
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TIP OF THE WEEK:  Closing of Bills Before Guest Arrival: Challenges and Considerations
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Dear Community, 🙋🏻

Today, we'd like to discuss a practice of closing bills before the arrival of guests and shed light on the challenges that can arise from this practice. 📄

There are two distinct options depending on the legal environment regarding required deposits:

Option 1 - Legal Environment with Required Deposits:
In situations where deposits are mandated (usually for revenue and VAT reporting purposes), it is essential to close the payment against the deposit, rather than the entire bill. By doing so, the accommodation charges remain open, allowing for future updates and modifications to the reservation. If an automatic deposit settlement system is in place, the deposits will be posted, and the remaining positive balance will remain open until manually closed upon the guest's departure.

Option 2 - Legal Environment without Required Deposits:
In this scenario, where deposits are not necessary, there is no immediate need to close the payment upon receiving it. Instead, the bill can be closed during the guest's check-out process, as it will then accurately match the total accommodation costs. Therefore, it is not advisable to close the bill in advance when deposits are not required.

Consequences and Challenges:
The consequences of prematurely closing bills can vary based on the legal environment and the presence or absence of required deposits:

👉 Changes and Cancellations: One of the most significant challenges occurs when changes or cancellations are needed. Cancellations may create rebates, and items on an open bill may suddenly appear, leading to confusion for some users who are unsure how to handle these situations.

👉 Limited Flexibility: Closing bills before guest arrival can limit the flexibility to make modifications, particularly in cases where the number of people in the reservation changes. Even with a full rebate, the closed bill may restrict updating critical information such as pricing, VAT, and the number of guests.

👉 Channel Manager Integration: For properties using channel managers, closing bills before guest arrival will impede the reception of updates and modifications, preventing seamless communication between systems.

Best Practices:
To overcome these challenges and ensure a smooth reservation process, consider adopting the following best practices:

👉 Understanding Legal Environment: Be well-versed in the legal requirements of your specific environment regarding deposits and bill closing.

👉 Timely Closing: If required, close payments against deposits promptly, ensuring accommodation charges remain open for future adjustments.

👉 Wait for Check-Out: In legal environments without required deposits, avoid closing bills prematurely, waiting until check-out time to ensure accurate billing.

👉 Effective Training: Provide comprehensive training to staff on handling changes, cancellations, and open bills to minimize confusion and errors.

👉 Communication with Guests: Clearly communicate with guests about the billing process and when they can expect their final bills.

We encourage you to share your experiences, insights, and tips related to this topic. Together, we can support and learn from one another in providing exceptional guest experiences. ✅

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