Booking platform fees: What you need to know

In the world of online booking platforms, "What's the cost?" isn't always a straightforward question. Between monthly subscription fees, transaction charges, and payment processing fees, the numbers can get confusing quickly. In this blog post, we aim to demystify the labyrinth of booking system fees so you can make an informed decision for your business.

Types of Fees in a Booking System

Monthly subscription fees (SaaS Fees)

Most online booking systems operate on a Software as a Service (SaaS) model, which means you pay a recurring monthly fee to use the service. The cost often depends on the features you choose and can vary widely between platforms. Tips for evaluation:

• What features are included in the monthly fee?
• Are there different pricing tiers?
• Is there a discounted annual plan?
• What notice would you need to give if you left?

Transaction and booking fees

Apart from the monthly subscription, some booking platforms also charge a fee per transaction or booking. This fee is usually either a flat rate per booking or a percentage of the transaction value. This fee might be taken from your business or added to the price your customer pays. Tips for evaluation:

• Does the booking platform charge a fee per booking, per transaction, or both?
• Is the fee a flat rate or percentage-based?
• Are there volume discounts for higher transaction volumes?
• Is the fee paid by you, or your end customer?

Payment Processing Fees

Whenever a customer pays using a credit or debit card, payment processors charge a fee for handling the transaction. These fees go to card processors and card-issuing banks. They can be a fixed amount, a percentage of the transaction, or a combination of both. Tips for evaluation:

• What payment processors does the booking platform support, and what are their fees?
• Are processing fees included in the booking platform's transaction fees or separate?

Why the Complexity?

The range of fees exists because booking systems offer varying services, from simple appointment scheduling to complex event management, online payment handling, and more. It's crucial to break down the fee structures to understand how they'll impact your bottom line.

How to Align Costs with Your Business Model

• Budgeting: Set a budget for software costs as a percentage of your revenue. This helps you gauge the affordability of various platforms.
• Forecasting: Estimate the number of monthly bookings and transactions you expect. This will give you an idea of the variable costs involved.
• Total cost of ownership: Don't just consider the upfront fees. Factor in all potential costs—monthly fees, transaction fees, and payment processing fees—to understand the total cost of ownership.
• Scalability: As your business grows, how will costs evolve? Will you move into a higher pricing tier, or will you benefit from volume discounts?

Conclusion: Transparency is key

Understanding booking system fees is like piecing together a puzzle. The complete picture only becomes clear when you've examined each type of fee and understood how it fits with your business model. Transparency is critical, both in how platforms disclose their fees and how you assess them relative to your business needs. Armed with a comprehensive understanding, you can make an informed choice that aligns with your financial goals and operational requirements. At eola we display our pricing upfront and we also allow you to work out potential costs and and savings using our pricing calculator.