If a hotel cancels my customer's room because they are overbooked, how will I find out?

Yes, you will find out, but the speed and the detail depend on the hotel and the supplier the booking came from. When a hotel or a supplier cancels or changes a confirmed room, that update is passed back through the hotel booking API and lands against the original booking in your system, so the booking stops showing as confirmed and carries the new status instead. Some suppliers push this through almost straight away, while others only report it when the booking is next checked, so there can be a gap between the hotel deciding and you seeing it.

Because of that gap, most agencies do not rely on the status alone. You can set the software to alert your team when a booking status changes, so someone sees it the same day rather than discovering it when the customer calls from the lobby. It is also worth reconfirming bookings directly with the property a few days before arrival for anything high value, long stay or during a busy period, since those are the bookings most likely to be moved.

What happens next is decided by the hotel and the supplier, not by us. In most cases the hotel offers a similar room or a nearby property of the same standard, and the supplier passes that offer to you so you can accept it or ask for a refund instead. Any compensation beyond the room cost is a matter between the hotel, the supplier and your customer.

Check with your supplier how quickly they report cancellations of this kind, and turn on booking status alerts for your team so nobody misses one.