In online retail, there is no doubt that “free shipping” is a necessity to customers. Everyone expects shipping to be “free” and offered by anyone selling goods online, however we all know deep down inside that “free shipping” isn’t actually free. Somebody has to pay for it and that somebody is the customer by way of a higher product price and usually just high enough to cover shipping costs.
Cleaning fees are not much different and there’s an age old debate amongst vacation rental managers and hosts about whether or not to add the cleaning fee on top of the nightly rate as a line item, or just to include it into the nightly rate. Hotels opt to bake all the fees into the nightly rate and with a hotel the guest expects their room rate to include cleaning fees, however on vacation rental platforms the vast majority of hosts have the cleaning fee added on top of the nightly rate as a separate line item. As a vacation rental manager I’ve tried it both ways and I now always charge a cleaning fee as a separate line item. When making this decision for yourself, here are some things to consider:
Everyone else is doing it
As a kid growing up, I would always get chided by my parents for doing something just because everyone else happened to be doing that thing too, but there is often safety and sometimes even wisdom in the crowd. Looking around at the other vacation rentals in my neighborhood and city it became very clear to me very quickly that I was one of the few, if not the only one who didn’t charge a cleaning fee. Everyone else had cleaning fees and were getting bookings just fine. This meant that not only were guests OK with cleaning fees, but they had come to expect them as a part of the platform. Guests acclimated to this way of paying for cleaning and don’t have an issue with how it operates. And in the 7 years I’ve been hosting with thousands of guests, I have yet to have a guest complain that we charged a cleaning fee or mention it in a review. Sometimes “because everyone else is doing it” is actually a good reason to do something.
I’ve heard this argument go both ways, but I generally feel it’s appropriate to give our guests an accurate idea of what cleaning costs. Cleaning is a passthrough cost for us, as it is for most hosts, and it’s a very real cost which I must pay someone else. Being up front and honest about this cost with our guests gives them a better idea of what they’re paying for the total price of the property.
Apples to apples
If everyone else is charging cleaning fees as a separate line item and you are integrating the cleaning fees into your nightly rate, then when guests are searching for a vacation rental and platforms are showing them the nightly rates, yours will always seem higher than your competitors. This is because your guests won’t be getting an apples to apples comparison on the platform’s search results screen and they generally won’t end up clicking on every result to see the cost breakdown. The guest will click on a few of the units with the lowest nightly cost and see that the cleaning fee is a separate line item for each of them and assume that’s just how it is and everyone is doing the same thing, including your listing.
Don’t punish guests
There are many ways to calculate ways to add cleaning costs into the nightly rate but by far the most common I come across is an average. This is to say that if cleaning the unit costs you $100 per cleaning and you generally clean the unit 5 times (for an average of $500 in total cleaning fees per month) and you usually have 20 nights worth of stays you will charge $25 per night more for your property. In this scenario a guest who spends 1 night at your property only pays $25 to have their unit cleaned once while a guest who spends 10 nights at your property pays $250 for the same single cleaning! You are not only punishing a guest for staying longer but you’re also giving them an economic disincentive to stay longer. What’s more, your guests who spend more and stay longer are financing your guests who stay shorter periods of time and spend less. If you do this, you should in the long run actually get shorter bookings overall as that’s what you will be incentivizing.
Not like hotels
Hotels don’t charge cleaning as a separate line item but hotels also clean your room every day of your stay (if you want them to) so a guest who stays for 10 nights does cost ten times more to clean than a guest who only stays for one night. So with hotels, it’s not an apples to apples comparison. I think it’s also worth noting that hotels do add on numerous other fees to guests’ reservations including things like resort fees, parking, etc.
While it may seem tempting to do your guests a favor and simplify things by adding your cleaning fee into their nightly room rate, when it comes to vacation rentals it’s rare that this is a positive for guests. Quite the contrary, we generally see having the cleaning fee as a separate line item as all around better for guests and hosts.