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Are there any examples out there of cancellation policies? We don't have one at the moment, and I may have to create one, if there are any industry standards out there, this would be very useful. Rather than starting from scratch.

Our only policy right now is that, deposits are refundable for cancellations due to death of immediate relative , or sickness that prevents travel. And its on a case by case basis. 

I have a young customer who is cancelling a tour, because her father got made redundant and now cannot fund her trip. Any thoughts on what I should do ? thanks.

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Hi Melissa, 

If you not have any cancellation and refund policy then it good to create one because it is the best way to increase revenue of your business through cancellation and refund policy i.e. followed by many travel companies worldwide. You can follow any of the below options, have a look -

 

Option 1 - First you need to check that your supplier is providing the cancellation policy or not? If they provide cancellation policy on specific charges then you can provide the same cancellation policy to your customer as per supplier's cancellation charges. 

Option 2 - You can also add markups on supplier's cancellation charges because your manpower and resource is spending the time on the same to provide cancellation service to your customer . 

Option 3 - If your supplier provide free cancellation and refund policy then you can also provide same policy to your customer who is looking for the cancellation free or you can add charges on the same.

Basically thing is how you are providing cancellation and refund service to your customer is up to you.

If you need any other additional help regarding cancellation and refund policy or travel technology for your travel business, please feel free to reach out at koushal.swami@quadlabs.com.

 

Best of Luck !

 

Regards, 

Koushal

QuadLabs Technologies - A Travel Technology Company

http://www.quadlabs.com

The two key elements regarding how companies set up cancellation policies

- are you likely to find someone else to take the booking, if the original customer cancels? (and are you on a certain allocation of stock on a date)

- have you incurred costs post booking, pre-travel, that you need to cover. 

Day tours for example tend to be more flexible than multi-day tours including accommodation

Deposits are normally non-refundable, whatever the situation. This protects you for any costs you may have spent out already, and compensates you partly for the time you've spent working on the booking. This is accepted by customers; they don't normally expect to get their deposit back. 

You'll need to work out what figure your deposit should be, which you think is fair to the customer, and covers your costs too. A reasonable figure would be something like 20% of the tour price, or a fixed amount. For example, we charge £150 as a deposit on most of our tours, though some have higher deposits where we need to purchase expensive permits or non-refundable flights straight away.

This is one reason why most companies make it compulsory for their clients to have travel insurance. In events like you describe (death of an immediate relative, sickness that prevents travel), then you keep the deposit, and the client makes a claim on their insurance and gets their money back. 

Most tour operators will display their booking conditions and cancellation rules on their website. I'd suggest you check a few and you can then make your own out of them. Its worth getting your booking conditions checked by a lawyer familiar with travel law in your country (or using some you know have been checked) as they form the basis of your contract with the customer. Industry bodies like ABTA in the UK may also provide templates. 

Here are ours... 

http://www.encounterstravel.com/booking_conditions.php

With your current customer, they're not going to be able to claim on any travel insurance policy, if they have one. Generally, you would't be obliged to refund them in a case like this. To show flexibility, you may like to offer them a cheaper tour, or to transfer their booking to a later date. 

Hope this helps. 

Ralph

Thanks Alex & Ralph, very good points. I didn't think about coverage under their own travel insurance. Ralph- you seem to have a very comprehensive policy. I was inclined to think that I'm not obliged to offer a refund in these circumstances. 

Hi Melissa,

We wouldn't generally offer a refund in this situation. We'd try and keep them travelling with us though, and see if they could delay their travel until later in the year or next year, or switch to a cheaper tour. 

As it sounds like you didn't have any booking conditions in place when this customer booked with you, then I don't think they have grounds for a refund, though I don't know what consumer law in Thailand would say. However, you'll need to consider your relationship with the customer, and the image you want to portray as a company to them. You can then decide how flexible you want to be. Perhaps tell them they're not due anything back, but they can transfer to another date or tour, or if that's not possible, as a goodwill gesture you'll refund half the payment to them. Really up to you how tough or nice you want to be. 

Hi Ralph, as our trips are generally 'once in a lifetime' kind of trips, we don't have a high percentage of return customers as after northern Thailand they tend to explore other parts of Asia. We do get recommendations though. Also in this case, this particular client is not our typical client, as they are young 20+ , whereas our market are middle age/families/retirees those who generally have higher income. The client says they don't even have enough money now to purchase plane tickets to Thailand, which is strange as normally people book air tickets first, then a tour. But anyhows.... Thanks again for your input

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