Note:
This article is relevant if you are using Guesty's rate plans. Learn more in our rate plans overview.
A rate plan is a combination of rules that allows you to offer a mix of different rates, cancellation policies, and meal options to attract a wider variety of guests. This best practices article will help you understand the difference between fully flexible and non-refundable rate plans, offers tips on how to increase occupancy and revenue, and provides our recommended setup if using Guesty's Auto Payments feature.
Fully flexible vs. non-refundable
See below the differences between fully flexible and non-refundable rate plans.
- Fully flexible rate plans provide potential guests with the freedom to cancel their reservations should their travel plans or other circumstances change. These rates are generally more expensive, but allow guests to pay more for extra peace of mind. They are often available to be booked right up until check-in.
- Non-refundable rate plans help you obtain guaranteed bookings and secure upfront revenue, even if the guest cancels. Prices are usually lower than those with flexible rates and are often booked around 24 to 48 hours in advance.
Increase occupancy and revenue
In order to increase occupancy and revenue, Booking.com recommends combining the following three items in Guesty for the relevant listings.
- A free cancellation rate plan.
- A non-refundable rate plan.
- Upcoming availability rules. Learn more.
Tip:
As a general rule, it is recommended to combine at least two of the above three items.
Note:
On average, Booking.com partners who activate all three of the above see a 5% increase in bookings, an 11% increase in visibility, and a 9% reduction in cancellations.
Auto Payment settings
When creating a rate plan, we recommend taking your Auto Payment settings into consideration. Ensure that the scheduling of payments falls in line with your rate plans' cancellation policies. See our recommended best practice below.
Fully-flexible rate plans
When using a fully flexible cancelation policy, we recommend choosing one of the following Auto Payment settings.
- Charging a certain percentage of the payment upon booking confirmation, or;
- Charging a certain percentage of the payment a specified number of days before check-in.
Tip:
Remember to refund the guest if they cancel the reservation during the period in which a reservation can be canceled. Stripe fees are still charged when the refund is made, even though revenue has not been generated from the reservation.
Non-refundable rate plans
When using a non-refundable cancelation policy, we recommend charging a certain percentage of the payment upon booking confirmation. This allows you to secure the payment in advance.
