A Service Provider’s Perspective on Cancellations…

​Before getting into this equine industry, I had a small retail store.  I would often get asked “Can I get the Friends & Family pricing?”  I used to joke by replying, “Sure, you can pay 10% more!  I’m family after all!”

The reality is I did honor a friends and family discount in my retail store.  I could do that because there was no trade off… I wasn’t losing out on anything and I would just replace that inventory.

But services are far different.  And a boarding and lesson program is even further from the retail norm.  Here’s the reality of a horse farm:

• Your “inventory” is comprised of stalls and time slots for lessons.  You can’t simply get more of either.  It’s a fixed inventory
• The service provided has a fixed cost, whether you sell or not…  horses must eat, maintenance must be done, and when the instructor is here, they expect to be paid

Which brings me to cancellation policies…

Why 30 days notice when you no longer need a stall?  Why 24 hours notice for lesson cancellation?

Well, both are ways to share business risk with your customers, which allows prices to be lower.  By giving 30 days notice, there is less risk that the stall will sit empty.  If we didn’t share that risk, we would have to factor the carrying cost of empty stalls into our board.

Lesson cancellations are probably an even touchier subject.  Most “last minute” cancellations are due to circumstances beyond control: a sick kid, a demanding boss, a broken car.  On top of that, you are told you have to pay for a service you didn’t get! 

Let me offer an alternate perspective…  I often tell prospective customers that they are really paying for the lesson spot, not the lesson.  Once we sell that lesson spot to you, we can’t sell it to anyone else!

A lesson program guarantees you a weekly spot at a set time and day.  If you aren’t there for that spot, no one is there to step in.  We know there will be vacations, school events, and life stuff, so the program is set up to accept the risk of cancellations with advance notice.  With 24 hours, the instructor has a chance to find someone who needs a make up lesson, wants a second lesson, or perhaps offer a trial to a prospect.  They are not always successful, and that is their revenue loss (risk).  With LESS than 24 hours, they are nearly guaranteed a revenue loss.  Like the boarding example, if we had to factor that into our pricing, everyone would pay more.  Instead, that risk is borne by each individual.  While it is an unfortunate cost to you when it happens, we believe it more fair and likely less total cost over time, than us trying to factor that risk into our business model.

I know this journey has given me a different perspective on service providers.  I now understand why my chiropractor charges me if I miss an appointment.  And I understand why my doctor overbooks herself, often making me wait when everyone does show.  I no longer feel like someone is taking advantage of my misfortune.  Instead, I realize that I am simply bearing the cost of my life’s risks.  I’d rather do that than pay a higher price to factor in everyone’s risk!

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