What is a consequence of overbooking in hotels?

Overbooking is a common practice in the hospitality industry, particularly in hotels, and it is mainly done to counteract the expected number of last-minute cancellations and no-shows. When a hotel overbooks, they sell more reservations than the actual number of available rooms, anticipating that not all guests will arrive.

When the hotel reaches full occupancy and all booked rooms are occupied, the hotel may need to "walk" some guests. This means transferring guests to a different hotel of equal or higher quality, often with compensation or additional benefits to maintain customer satisfaction.

Walking guests can have significant implications. While it helps the hotel manage its booking strategy, it can lead to dissatisfaction among guests who expected to stay at the original hotel. Therefore, this practice is a direct consequence of overbooking, highlighting the risks associated with this revenue-maximization strategy in the hospitality sector. It illustrates the delicate balance hotels must maintain between maximizing revenue and ensuring customer satisfaction.

The other options present scenarios that, while beneficial, do not directly arise as consequences of overbooking. Increased revenue from sold rooms and improved customer service ratings might be goals or benefits of effective management but do not define a consequence of overbooking itself. Similarly, while operational costs may be influenced by room occupancy,