IE 11 is not supported. For an optimal experience visit our site on another browser.

'Guest-gouging' on the rise at high-end hotels

Some hotels now charge for providing an in-room safe (whether you use it or not), receiving a package, and storing your luggage with the bell desk. At some places an energy surcharge is added to the bill. By ConsumerMan Herb Weisbaum.

I don’t like a lot of surprises when I stay at a hotel. Getting a room upgrade, fruit basket or complimentary breakfast is fine. Having unexpected charges on the bill at checkout is a real drag.

Hotels are always looking for ways to raise revenue. They’ve already increased room rates, which are up an average 6 percent from last year. Now they’re adding extra fees — charges not included in the daily rate — to boost the bottom line.

For its July issue, Consumer Reports looked at hotel fees and concluded that “guest-gouging” is on the rise.

Some hotels now charge for providing an in-room safe (whether you use it or not), receiving a package, and storing your luggage with the bell desk. At some places an energy surcharge is added to the bill.

But wait, there’s more! Consumer Reports says some hotels actually charge guests for the routine maid service or for the employee who services the minibar. There could even be a mandatory tip for the staff added to your bill.

The fancier the place, the more likely you are to be slapped with a fee or surcharge. For example, Consumer Reports found that 60 percent of high-end hotels charge for an Internet connection, compared to just 10 percent of the budget hotels.

According to Bjorn Hanson, a lodging consultant for PricewaterhouseCoopers in New York, the U.S. lodging industry made $1.6 billion dollars in fees in 2006. Hanson considers a fee to be any charge a guest would not normally expect to pay as part of the room rate. He expects revenue from fees to hit a record $1.75 billion this year.

Here’s the bottom line for travelers: "More hotels are charging fees and surcharges,” Hanson says, “and the amounts of these extra charges are increasing.”

The resort fee – the most hated of all
This is the one that really gets people upset. Many upscale hotels now tack on a fee of $12 to $40 a day to pay for the pool, tennis courts, putting green, “complimentary” newspaper, and in-room phone calls. You pay the fee even if you don’t use any of these amenities.

Because of several lawsuits against big hotel chains, most places that charge a resort fee make sure guests know about it.

“They tell you about the fee when you’re making the reservation and when you check in,” says Joe McInerney, President and CEO of the American Hotel and Lodging Association.

But that misses the point – people simply don’t like resort fees.

K.C. Summers, travel editor at the Washington Post, says readers constantly complain to her about resort fees. “They haven’t used the gym or the tennis court, they haven’t read their ‘free’ newspaper, and yet they are socked with the fee. It just doesn’t seem right.”

Summers says travelers want hotel operators to be honest with them. “They don’t want add-ons,” she says. “They want to know the real rate.”

Why are hotels doing this?
The industry says it needs more revenue to pay for improvements and upgrades — flat screen TVs, better bedding, curved shower rods, and fancier shampoos.

OK. But why not just raise the room rate? Why nickel and dime me when I get there?

“They’re doing it because they can get away with it,” Summers says. “It’s as simple as that.”

There’s also another reason. Hotel operators are afraid that boosting the daily rate will cost them business. People are very price-conscious when deciding which hotel to book. So rather than raise the rate — which is easy to compare online — and possibly lose a customer, they’d rather get you in the door and then pad the bill with fees and surcharges.

“This makes no sense,” says Douglas Shifflet, who runs a market research firm in Virginia.  Every month D.K. Shifflet and Associates surveys more than 50,000 households to get their feedback about the hotel industry.

“Extra fees are a hassle and hassles are an annoyance,” he says. Based on his surveys, Shifflet says eliminating hassles is significantly more important to travelers than adding amenities. “It’s time to provide value to the customer,” he says.

How to protect yourself on your next hotel stay
Never assume something is free — ask. Find out if there’s a charge for phone calls, the high speed Internet connection or in-room safe. Unless you’re told that bottled water in the room is complimentary, expect to pay an outrageous price for it.

When you make a reservation, find out if there are any routine fees or charges other than the room rate and sales tax. Hotels say information about fees is usually listed on their Web sites, but travel experts tell me it isn’t always easy to find.

If you’re doing this on the phone, get the agent’s name or ID number. That may come in handy if there’s a problem at checkout.

At checkout, challenge any fee you believe is unfair or unexpected, but don’t be surprised if the hotel refuses to budge. Bjorn Hanson of PricewaterhouseCoopers says the front office staff is less likely to remove a charge than they were a few years ago. That’s especially true with the resort fee.

When you get home, write corporate management. Tell them how you feel about the way you were treated. Hotels respond to customer feedback. If they get enough complaints about these add-ons, maybe they’ll get rid of them or at least do a better job of disclosing them prior to booking the room.

More information