January 8 2010 - Feature
Partnering With Your Competitors Can Boost Revenues
Formal arrangements to cooperate with a competitor are becoming more commonplace as squeezed operators seek revenue streams.
By Linda M. Jagiela
Retail Vehicles
George Asseraf, owner of A Family Limousine in Ft. Lauderdale, FL, cautions that operators should have a thorough understanding of cancellation policies. "If you give up the ability to sell your vehicle by assisting an affiliate, they have to understand that there is a cost to cancel the ride," Asseraf says. "We have been burnt in the past from this and now we make it very clear when we are setting up these types of relationships."
Asseraf has a fleet of extreme vehicles, such as SUV stretches, which are popular for retail clients and events. "I am very selective as to who I will take business from in the industry," he says. "I need to be able to trust that they are credit worthy."
For Rains, such relationships pay off when his stretches go out on weeknights. "You need to be very open-minded when you form these types of relationships," he says. "We are down from 50 vehicles to 30. Our clients still want the vehicles we had and we are able to provide them by working with others. It allows us to keep the client happy. We are working with companies who in the past we might not have."
7 Tips to Work Well with Competitors
1. Trust
Work with companies that you trust. If you have to worry that they will solicit your clients, then you should not be working with them.
2. Integrity
Know that your competitor is your client and you are transporting its client. You need to represent the company giving you the work.
3. Training
Make sure that the companies you work with understand your policies and that you and your staff understands theirs. The goal is that you are both providing seamless transportation to the passenger. They shouldn't be able to tell the difference.
4. Representation
Clients should not be able to differentiate from their regular company and the partner company.
5. Clear Understanding of Terms
Work out credit, payment, and cancellation terms up front.
6. Selection
Tom Miller looks for partners who have similar equipment e.g. late model LTC black sedans and who have similar standards of service. "The company must be used to providing corporate service," he says. "Their standards should be the same as ours on things like training and chauffeur attire. I limit these relationships to a couple of companies and a few who own their own vehicles with a high level of service."
7. Agreement
Tom Miller suggests that the two companies form an agreement that they understand the nature of their competition but that they can never let it affect customers. That is, regardless of whose client is in the back of the vehicle, the service should always be outstanding.
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