The Black Market for Restaurant Reservations: A Crackdown
The Problem of No-Shows
The law of supply and demand has always made it tough to get a table at a popular restaurant. Mark Hauser, a Scarsdale foodie, agrees, "the Manhattan hotspots now that you really want to get a reservation – like Atomix – it’s really hard unless you know somebody."
The Rise of "Bots"
Amy Zhou, executive director of operations at Gracious Hospitality Management, which runs COTE Korean Steakhouse and COQODAQ, noticed an uptick in no-shows over the last two years. She discovered "bad actors would program bots that had the ability to understand when my reservations systems were going to release every single reservation online and they would take every single one of them."
The Impact on Restaurants
Mario Fava, the owner of Moscato, points out that unsold reservations leave eateries holding the bag. "Especially having a small restaurant, if you don’t fill a table, that hurts the bottom line at the end of the day."
The Solution: A New State Law
In the last two years, some restaurants began noticing a huge jump in no-shows – from the industry’s typical five to 10 percent – to 20 and even 25 percent. Hot spots like COTE Korean Steakhouse offer four hundred reservations a night. "All of a sudden, one hundred covers don’t show up, that’s – on any given night – three servers, bartender, three server assistants, food runners. That’s up to ten to twelve staff who are not making the income they were expecting to make for an evening. It’s really damaging," Zhou said.
A new state law in New York aims to enforce rules like the ones against ticket scalping – making it illegal for third-party reservation services to make unauthorized reservations. "We’re putting an end to the predatory black market for restaurant reservations – protecting consumers and businesses, and giving everyone a chance to get a seat at the dinner table," said Governor Kathy Hochul. "New York is home to some of the best restaurants in the world, and whether you’re returning to your favorite local spot or trying out the latest in fine dining, you deserve a fair system."
The Impact on the Industry
Andrew Rigie, executive director of the NYC Hospitality Alliance, believes that with this measure, "at least government can go after them, issue penalties and mitigate the impact." This action is not about companies like Open Table and Resy, but instead focuses on third-party businesses that don’t have an authorized business relationship with the restaurant.
Conclusion
With this new law signed, Rigie believes "maybe the humans will have a little bit of an upper hand getting the reservation because they’re not competing with technology."
FAQs
Q: What is the problem with no-shows?
A: No-shows are when customers reserve a table but do not show up, leaving restaurants with unsold reservations and a loss of revenue.
Q: What is the impact of no-shows on restaurants?
A: No-shows can be damaging to small restaurants, causing a loss of revenue and income for staff.
Q: What is the new state law addressing?
A: The new state law aims to prohibit third-party reservation services from making unauthorized reservations, protecting consumers and businesses.
Q: What is the goal of the new law?
A: The goal is to give everyone a fair chance to get a seat at the dinner table, by ending the predatory black market for restaurant reservations.
