Want A Dinner Reservation At A Popular Restaurant? Pay Up

Earlier this month, we shared with you the news that a delivery-only restaurant in San Francisco added dynamic pricing to its business model: that is, instead of shutting down orders when there is high demand, they simply charge customers more. Similar models are becoming an extra revenue stream for restaurants, removing the risk from reservations and earning them more money when their products are more in demand.

Sure, maybe restauranteurs have always wanted to charge extra for the privilege of a 7:30 reservation. The difference is that now, customers in markets where ride-sharing services Uber and Lyft roam the streets are kind of used to the idea of reserving things they want immediately using an app, and, more importantly, they’re used to the idea of sometimes having to pay extra to get those things when demand is high.

This is the same principle as surge pricing on the ride-sharing app Uber, where customers pay extra at busy times. The New York Times reports that restaurants are now charging customers for reservations, either as an extra income stream or just to make people more likely to show up.

That’s because 5 to 10% of customers who make reservations never show up. One system that charges customers a relatively small fee–five or ten bucks for a table, which is then credited to the bill if the party actually shows up–brought that number down to only 2%.

Can You Uber a Burger? [New York Times]