By Rebecca Christiansen
LAS VEGAS – Small and medium limousine operators can
improve their chances for success by instituting a strong
revenue forecasting system, embarking on an effective
advertising program and making sure their cars are
immaculate, a panel of three operators advised at the LCT
The operators each offered tips on one subject relating to
operating a limousine company:
Developing a revenue forecast is a key to the success of
any keyes any successful small or medium-sized business,
according to Steven Qua of Cleveland’s Company Car,
which has 13 cars and six employees.
“The forecast is the roadmap,” he said. “If you don’t
forecast your profit, you’re never going to get there.”
He suggested hiring an accountant and/or a financial
planner to help map out revenue streams and compile them
into a forecast. Often, this leads to what he called “a
scientific guess,” but even that is better than having no
clue at all.
What are the areas an operator should focus on? First, Qua
suggested, look at the company’s business mix and
determine “what business you are in.” Do you have more
corporate clients or retail? Does a large percentage of
your business come from airport runs or longer ground
transportations? When you have the answer, figure out how
many runs per vehicle per month you have to make to meet
your revenue forecast.
Assume that you want to make $8,000 to $10,000 per vehicle
a month – a “pretty good” range for small to medium
operators, Qua said – and you are currently only running at
$4,000 to $6,000 per vehicle a month. Your revenue forecast
will indicate if it’s a bad idea to add cars, for example.
Instead, you should try to add affiliates.
Qua noted that many smaller operators are tempted to add
cars because their businesses are booked beyond capacity
every Saturday night.
Still, if the cars are running at an overall lower-than-
desired per-vehicle revenue rate, it is better to farm out
some of the weekend runs until the monthly vehicle revenue
reaches the operator’s preferred forecast.
When building the forecast, also factor in your company’s
history, what you can expect from old customers, and the
four types of expenses: variable expenses, such as fuel
cost and washes; semi-fixed expenses, such as maintenance;
fixed expenses, which you cannot avoid, such as insurance
and car payments; and labor expenses.
percent to 28 percent of every dollar [of income] is
[spent] on payroll,” added panel moderator Tom
Mazza, executive director of the National Limousine
Determine what these expenses are on a per-trip basis, Qua
said, adding that operators need to know their monthly trip
count in order to determine their overall revenue per
In looking at the benefits of various types of advertising,
the Yellow Pages deserve special note, said Bill
Goerl, of Bayshore, N.Y.,-based Clique Limousine, a six-
car, 15-employee operation. “It’s very expensive, but it
To limit the cost of this type of ad Goerl suggested
advertising only in the local Yellow Pages and making sure
the ad is effective in drawing potential customers’
attention by including the company logo and mission
Also, he advised operators to track the success of the ad
to see if the investment is worth the cost. He also
suggested listing a local phone number instead of an 800
number because it gives customers a local feel.
Secondly, Goerl suggested sending direct mail pieces only
to existing customers. In these difficult economic times,
marketing is better done through a rifle, rather than a
Additionally, Mazza suggested it’s better to send a quality
item to a fewer number of customers than to send a cheap
item to a large number of potential customers.
The customers that receive the more expensive items are
likely to think more highly of your company for sending
them a quality item and may very well bring you as much
business — if not more – than the larger audience would.
Goerl also addressed the impact of the Internet on
limousine operators, saying that, “In today’s society,
people want instant gratification.”
It is no longer enough to have your company information
listed on a Web site, he said. Make sure your Web site is
professionally built, has a brochure of the services and
vehicles you have available – with prices – and the
company’s history. “And don’t just list the types of
vehicles,” he said, “but describe them.”
Also, it’s often worth the extra expense to pay the search
engines to list your company’s Web site in a top position,
Maintain Your Investment
Randy Tooker, who has
been in business for 20 years, pointed to preparation and
maintenance as a recipe for his success.
“I strive for
perfection,” he said. “I want the car to smell, feel and
look as if I were getting in it.”
Tooker, who runs Lake Forest Limousine of Orange County,
Calif., suggested developing a pre-trip inspection list
that all drivers should follow. By thoroughly checking
every car prior to every trip, Tooker believes he has fewer
than average breakdowns with clients in the car.
team effort,” he said. “It’s good, because I hate to think
that I messed somebody’s wedding up.”
Tooker said he relies on Bounce dryer sheets and a smoke-
free environment to keep his cars smelling fresh. He also
demands two sets of mats when purchasing a new car so that
they can be hung out and rotated between runs, and said he
believes that investing in a carpet extractor could be a