Rental Cancellation Policies

I'm curious to know what sort of cancellation policies that flight
schools and rental outfits have in place to make it highly probably
that those who schedule airplanes will actually fly them.

Our school doesn't charge people for not showing up, much less for
cancelling very close to the proposed flight time. You can even
schedule a plane for a week, then cancel at the last minute. Or you
can schedule a 5 hour block and only use 1 hour of it.

Can you institute policies that you must use some percentage of your
scheduled time or face some charge for unused time? Does a
non-refundable deposit make sense for extended schedule blocks? Can
you really charge some fee to those who don't show up or cancel too
late without alienating your customers?

Appreciate any thoughts on what works and seems fair to all concerned.