How much does Booking.com really cost a small hotel?
The commission rate is only the start. We worked out what a £100 night really leaves you with on Booking.com, with Genius, Preferred Partner and VAT.
Short answer
More than the rate in your contract suggests. Booking.com charges its commission on the whole booking, including cleaning and cancellation fees and, in most countries, VAT. Genius discounts come out of your price too. On a £100 night at a 15% rate, you keep £85 plain, £76.50 with a Genius discount, and about £98 when the guest books direct by card.
Key takeaways
- Commission is charged on the total booking, fees included, and in most countries on VAT too. Only local taxes such as city tax are left out.
- The Genius discount is paid by you, and commission is then charged on the discounted price. A 15% rate becomes a 23.5% cost on that night.
- Preferred Partner adds commission on top. Your Extranet shows the real total on each reservation statement.
- For a ten-room guesthouse selling 60% of its nights on Booking.com, a 15% rate is about £21,350 a year. Moving one booking in ten to your own site keeps about £1,900 of it.
Most owners know their commission rate. Fewer know what it comes to once Booking.com’s programmes and rules are added. We took a £100 night and followed it through.
What does Booking.com charge commission on?
The whole booking, not only the room. Booking.com’s partner help says commission is “a set percentage of the total booking amount”, including cleaning fees, service fees, and fees you charge for cancellations and no-shows.
It also charges commission on:
- non-refundable bookings, whether the guest came or not
- overbookings, where you also pay to move the guest elsewhere
It leaves out local taxes such as city tax. VAT is a different matter: in most countries, commission is charged on VAT or GST too.
That last point is easy to miss. If your £100 rate includes 20% VAT, as in Britain, you only keep £83.33 before tax. A £15 commission is 18% of that, not 15%.
What does a £100 night leave you with?
We worked through one £100 night under each set-up. The 15% rate is an example; use the one on your own contract.
| How the night was sold | Guest pays | Commission | You keep |
|---|---|---|---|
| Booking.com, 15% rate | £100 | £15.00 | £85.00 |
| Booking.com with a 10% Genius discount | £90 | £13.50 | £76.50 |
| Genius plus Preferred Partner (18% assumed) | £90 | £16.20 | £73.80 |
| Your own website, UK card through Stripe | £100 | £1.70 card fee | £98.30 |
With Genius and Preferred Partner together, a 15% contract rate costs you 26% of your full price on that night.
Who pays for the Genius discount?
You do. Booking.com’s own help page answers this directly: the standard Genius discount is “funded by you, the accommodation partner”.
When you join, a 10% discount goes on your cheapest and most popular room type. Booking.com then charges commission on the lower, discounted price. Levels 2 and 3 can offer 15% and 20% discounts to some guests.
In return, Booking.com says Genius partners see 30% more search views and 45% more bookings on average. Those are its averages across all partners. Whether it pays for your property depends on how many extra nights it brings, which only your own figures can show.
How much extra does Preferred Partner cost?
Booking.com calls it “a small increase in commission” and does not publish one figure. In exchange, Preferred partners get a thumbs-up badge and more exposure in search results. Booking.com says they average 65% more search views and 20% more bookings.
To see what you pay, compare the commission on a reservation statement with the rate in your contract. Any difference comes from a programme you are in. You can leave Preferred Partner at any time in the Extranet, under Boost performance, and the commission changes straight away.
The table above assumes 3 extra points. Replace it with your own.
What does it come to in a year?
Take a ten-room guesthouse. Assume it is full 65% of nights at £100, and sells 60% of those nights through Booking.com at 15%.
- Nights sold in a year: about 2,370
- Sold on Booking.com: about 1,420 nights, worth £142,350
- Commission at 15%: about £21,350
That is before Genius, Preferred Partner or VAT make it larger.
Now move one Booking.com night in ten to your own website. That is about 142 nights. Each one keeps £13.30 more (£15 commission minus a £1.70 card fee), so about £1,900 a year.
A direct-booking website that costs £500 a year pays for itself after about 38 nights moved.
To run the same sums with your own rooms, price and rate, use our free commission calculator.
Where do owners lose money without noticing?
Three places, all in Booking.com’s own rules:
- No-shows not marked in time. You have 48 hours after check-out to mark a no-show or cancellation in the Extranet. After that, you pay commission on the full original booking.
- Waived fees. If you waive a cancellation fee for a guest, mark it, or you still pay commission on it.
- Programmes you forgot. If the rate on your statements is higher than your contract, check the Boost performance section for programmes you joined.
What should you do this week?
- Open the Finance tab in your Extranet and find the commission rate on a recent reservation statement.
- Compare it with your contract. If it is higher, find out which programme is adding to it.
- Work out last year’s total: Booking.com revenue multiplied by your rate.
- Pick one number to move: the share of nights you want booked direct next year. One in ten is a realistic start.
Questions owners ask
What commission does Booking.com charge?
The percentage in the agreement you signed when you joined. Booking.com says it depends on your country, property type and that agreement. You can see yours in the Finance tab of the Extranet, under Reservation statements. If a statement shows more than your contract, you are probably in a programme such as Preferred Partner or Visibility Booster.
Do I pay commission on city tax and VAT?
Not on local taxes such as city tax. In most countries, Booking.com does charge commission on VAT or GST. Your General Delivery Terms say which applies to you.
Do I pay commission when a guest does not show up?
Only if you charge them. Mark the no-show in the Extranet within 48 hours of check-out and waive the fee, and no commission is due. Miss the 48 hours and you are charged on the full original booking.
Is Genius worth it?
Booking.com says Genius partners see 45% more bookings on average. That is its own average, not a promise for your property. Turn it on for a season, then compare your nights and your income after commission with the same season the year before.
Can I charge less on my own website than on Booking.com?
In the European Economic Area, yes. Booking.com lists these as no-parity countries. Elsewhere, check the parity status in your General Delivery Terms. Some countries only stop you from undercutting Booking.com on your own website.
Sources
- Booking.com for Partners. Understanding your commission
- Booking.com for Partners. Understanding the Genius marketing programme
- Booking.com for Partners. Understanding the Preferred Partner Programme
- Booking.com. How we work
- Stripe. Pricing