Illinois Plans to Crack Down on Reservation Pirates

I first heard about this concept a few years ago. The idea was to build an app that could get you a reservation to places that are routinely difficult to get….for a price.

Now there are third party groups that are taking up reservations at popular restaurants in metro areas, and “reselling” the reservations. “Reselling” is an interesting word here because the reservation wasn’t bought (or sold by the restaurant) in the first place.

The idea is similar to third party groups buying up tickets to concerts or sporting events and selling them on the secondary market. Creating a middle man in the purchase process creates an extra level of pay that drives prices up.

Kudos to these business people like Appointment Trader for finding something that has value but no cost to exploit for profit. Reservations, depending upon the day and establishment could potentially cost hundreds of dollars. Hundreds of dollars for the table and seats at a particular time. No food or drinks are included in this reservation agreement.

The Illinois Restaurant Association is teaming up with Illinois Rep. Margaret Croke to introduce legislation called the “The Restaurant Reservation Anti-Piracy Act” that would ban third party reservation companies from selling, listing, promoting, and advertising the reservations at popular restaurants they have obtained.

Third party groups can have a detrimental effect on the restaurants they are making money on. In regards to destination dining, if someone is planning on traveling to experience a restaurant, but find out reservations are booked they won’t travel to eat. Should a reservation company not be able to sell the reservation they have claimed, then there is a decent chance that table will not be used in that time window. That is all lost revenue. Except for the third party who didn’t pay for the reservation in the first place.