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

September 22, 2017

Dealing With Weird And Bizarre Passenger Requests

One party of girls wanted to be smacked upside the backside every time they exited the limousine.

September 13, 2017

Create A Handbook Your Employees Will Actually Read

Black and white words on a page are boring and uninspiring; here are some things to consider when creating a how-to guide for your company.

August 29, 2017

Billy The Coach: How To Plan And Prepare For Success

The LCT Summit keynoter starts contributing this week to our blog by asking: What is it you want bad enough to work for?

August 16, 2017

Don’t Let Poor Grammar, Spelling, And Punctuation Ruin Your Image

You are what you write. Make sure you leave a good business impression, especially on social media.

August 8, 2017

Behind The Screens: Why Face Time Matters

Computers and smartphones have conditioned us to text and email our way through life. Here’s how Millennials and managers can work together to break the habit.

See More

Facebook Comments ()

Comments (2)

Post a Comment

Submit

Blog

See More

LCT Store

LCT Magazine - September 2017 $12.95 MOTORCOACH / BUS ISSUE COVER STORY: * Irizar Racks Up A Good Rookie Year * *



Connect

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

TruckingInfo.com

THE COMMERCIAL TRUCK INDUSTRY’S MOST IN-DEPTH INFORMATION SOURCE

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