. . . Most importantly, LCT's State of the Indusry speech is set for Monday, Jan. 26 at the ILCT Show in Las Vegas. Look for Dav El CEO Scott Solombrino to ignite the industry with his searing insights and unconventional wisdom -- all to be delivered in a brash n'stash package of facts, figures, and rhetorical fusillades.
LCT REPORTS, YOU DECIDE OR HIDE. . .
LCT Supporters Take The Stage at Limo Digest Show
Rutter, Jacobs deliver speech that encourages industry to weather turbulent times until turnaround begins
By Martin Romjue
ATLANTIC CITY, N.J. — Two longtime associates of LCT Magazine and chauffeured transportation fixtures gave a state of the industry speech to the Limousine Digest Show Oct. 20, encouraging operators to hang tough in a tightening economy and prepare for better times ahead.
Dawson Rutter, CEO of Commonwealth Chauffeured Transportation Worldwide of Boston, and George Jacobs, CEO of Windy City Limousine of Chicago, delivered a “debate style” presentation to about 400-450 operators and industry suppliers inside the oceanfront Trump Taj Mahal convention center.
Rutter and Jacobs are members of LCT Magazine’s editorial advisory board and have been associated closely with the publication and the chauffeured transportation industry since at least the early 1980s.
The CEOs spoke to Digest attendees amid an economy that has deteriorated into a steep recession since the penultimate state of the industry speech was given in March by Dav EL Chauffeured Transportation Network CEO Scott Solombrino at the International LCT Show in Las Vegas. Solombrino, also a member of LCT’s editorial advisory board, is a four-term past president of the NLA.
LCT’s global show attracted at least 3,500 attendees overall during its four-day agenda in March, and about 1,600 at its State of the Industry Speech.
Hosted by limousine industry guru Tom Mazza, the Digest presidential-themed “debate,” with Rutter and Jacobs referred to as “Senators,” was actually more of a collegial pep talk than a sharp difference of views.
Both self-made business owners exhorted operators to find opportunities in hard times. Jacobs, whose company has enjoyed increasing revenues as it has broadened into limousine bus services, spoke about two motivations that apply in scary economic times: greed and fear.
“When people act out of fear, then you need to get greedy,” Jacobs said. “When people start getting greedy, then you need to operate out of fear.”
That means as people panic and sell, operators should look to invest and buy, he said. When everyone buys and hypes up investments, then be very afraid and cash in and hold finances close, he said.
Rutter, who began his career as a young cab driver on the streets of Boston, pointed out that – as of October – the economic downturn in 1982 was far worse that the current credit, equities, and housing debacles. “My company was born out of that downturn,” Rutter said. “You have to position yourself for tremendous growth when things turn around.”
Amid back and forth banter, Rutter and Jacobs offered some advice and observations for being aggressive in recessionary times:
• Spend more on marketing, promotions, and sales to keep your message alive and growing.
• Keep service levels top-notch and ratchet up your excellence.
• Never show negativity about anything. Employees are watching.
• Stay positive in the event of a restructuring. Such events bring new ways of doing things.
• Tell employees the truth. Never let them learn from a bouncing paycheck.
• Diversify your client list with other market segments. Not every business sector suffers in a down economy.
• Smaller, mid-market banks will be active in the road show van market. Responsible lenders will survive and will need to make loans.
• Secured credit is still available to buyers with good credit ratings. Unsecured credit, however, such as commercial paper, has frozen up.
• Interest rates were too low for too long. Plan for moderately higher rates.
• Find different vehicles that meet diverse needs; branch out into buses, SUVs, and whatever customers like.
• Be creative and dig around in new businesses
• As insurance companies try to recoup losses, premiums will rise. Operators must practice good risk management, loss control, and safety.
Among revenue alternatives, Jacobs also advised chauffeured operators to turn to the dying industry – or the clients who never gripe. “There is big money in funerals,” Jacobs said. “It’s not a dying industry. People in the back never complain, and it’s a good business to get into when things are dead.”
Jacobs and Rutter both cautioned about greening fleets, saying while it is necessary, going green should be sensible and involve the bigger picture.
“When you turn on the air conditioner in a hybrid, it goes back to the gas engine,” Jacobs said. “But you should still go green, because it is the right thing to do. So many people only give business to companies that attempt to go green.”
Rutter reminded operators that limousines are some of the greenest vehicles around when you put more than one person inside. “The calculations should be based on passenger miles per gallon (PMPG), or miles per butt,” Rutter said. “Six to 20 people in a limousine add a huge value to the environment.”
Jacobs predicted the industry in five years will be “fat, dumb, and happy.” “This is only a bump in the road,” he said of the economy. “It’s not the end of the world. It’s not Armageddon.”
Every downturn must be followed by an uptown, said Rutter, who is now dealing with the fourth recession of his career. “The harder you work, the smarter you work, the farther you will get. When we finally come out of this, it will be like a balloon popping up from the bottom of a lake.”