Team Techniques for Reducing Costs & Retaining Revenue

Posted on February 5, 2009 by LCT Magazine

NOTHING'S EASY: As revenue cash flows in the chauffeured transportation industry have dropped off dramatically since November/December, managing operations efficiently has become a top priority. This may mean rapid downsizing in fleet, staff, and other operating expenses. It can also mean renegotiating corporate contracts and working with staff to cut costs.
Tom Mazza, president of Tom Mazza Consulting, gave this example in his February newsletter of how an operator dealt with a 20% rate reduction requirement from a corporate client:

"My advice to my (operator) client, in this instance, was to agree to the discount. We presented the following proposal back to the (corporate) client which was accepted: 

  • Conversion to on-line booking with agreement to pay $5 per reservation for phone reservations after 90 days.
  • Net 15 days on all invoices with penalty after 30 days. All payments submitted electronically.
  • Agreement from client to take 'any vehicle available' other than stretch when necessary.
  • Re-evaluation of pricing in 12 months."
Management met with chauffeurs and explained the situation, and chauffeurs agreed to a reduction of $5 per trip. Renegotiating with clients and chauffeurs didn't create a perfect solution, but accepting reduced rates and lowering operating costs on this account was much better than losing all this revenue, Mazza says. The staff was satisfied with how it was all handled: "The chauffeurs and the office staff were tremendous. Full disclosure from management made them feel respected and they responded in kind."  -- J.L.

View comments or post a comment on this story. (2 Comments)

More LCT Blog Blog Posts

July 18, 2017

Getting It Wrong On Uber’s Return To Austin

See Exhibit A on the misleading spin the limousine industry faces when exposing the unfairness of TNCs.

July 18, 2017

Comic Conventions Can Be A Geeky Goldmine

It’s time to tap into your inner nerd and expand past traditional tradeshow group transportation.

July 6, 2017

Welcoming All Back To The New LCT Blog

JIM LUFF: I'm not retired, tired, or tuned out. Just immersing in other areas of the industry.

March 8, 2017

Immigration Issues Can Hit Limo Operators

Illegal or not, immigrants in one California region spend hard-earned money on renting stretch limousines.

March 1, 2017

Did The Dent Fairy Come To Visit You?

Unlike the tooth fairy and baby teeth, the dent fairy never runs out of vehicles.

See More

Facebook Comments ()

Comments (2)

Post a Comment



See More

LCT Store

LCT Magazine - July 2017 $12.95 COVER STORY: * Why These Titans Work So Hard to Give it Away * *


Experience the three annual industry events for networking for business, showcasing vehicles and products, and getting the tools for success.

Read About Your Region

What’s Happening Near You?
Click on any state to see the latest industry news and events in that region.

More From The World's Largest Fleet Publisher

Automotive Fleet

The Car and truck fleet and leasing management magazine

Business Fleet

managing 10-50 company vehicles

Fleet Financials

Executive vehicle management

Government Fleet

managing public sector vehicles & equipment


Work Truck Magazine

The number 1 resource for vocational truck fleets

Metro Magazine

Serving the bus and passenger rail industries for more than a century

Schoolbus Fleet

Serving school transportation professionals in the U.S. and Canada

Please sign in or register to .    Close