DEC. LCT: Part I: An Atlanta operator retraces every step he took and then upgrades it with what he has learned during the last 10 years.
Are you getting the most out of your Web site? Show speakers recommended that livery companies be very strategic in their use of the Internet and other marketing techniques.
In Limo 101, a successful operator shared his insights and fundamentals necessary to run a thriving limousine business.
An employment law attorney offered sound advice on hiring and employment practices designed to create a smooth-running work environment and to avoid legal hassles.
During his keynote speech, well-known author and speaker Michael Gerber told the audience that most small business owners are so busy being technicians that they may not be able to create the proper systems to keep their daily work passions from turning into drudgery and a failed business.
Soliciting extensive feedback from clients prior to submitting a corporate proposal was the message honed in on attendees at the seminar, “Corporate Proposals That Work.”
Operators Should Build a Budget for Marketing and Updating Their Web Sites
Up to three-quarters of the budget traditionally set aside for Yellow Pages advertising should be diverted to the Web, Thom Dupper of Site Dynamics in Clear Water, Fla., told attendees at the “Get the Most From Your Web Site” seminar.
Dupper recommended budgeting about $2,500 per year to market a Web site and keep the information current. This includes seasonal specials to attract buyers, current news that keeps them coming back and Web site optimization, which helps sites get better rankings on major search engines like Google, Yahoo or AOL.
Over 500 million searches are performed each day on the Web, said Dupper. Nearly 75% of all Americans are online.
Eddie McCoy, president of FASTTRAK Livery Systems in Phoenix, added that 60 million business travelers use the Internet for travel planning. Seventy-five percent of all consumers who shopped online bought online.
Dupper and McCoy agreed that the limousine industry is lagging behind the car rental industry in moving to the Web for reservations and marketing.
On average, limo operators get about 10% to 15% of their business from online sales. More than half of the business that comes through the door for rental car companies comes from online sales.
“Rental car companies once spent 20% of their marketing dollars for Web-related marketing,” said Dupper. “They now spend 80% of their marketing budget there.”
While there is an initial cost related to setting up online reservations, limo companies save money on every ride that is booked online, said McCoy. While 80% of limo operators have Web sites, only half of them offer real-time online reservations.
Whether operators have two cars or 200, they need a quality Web site, noted Dupper. To be a player on the Web, operators need a site that’s professionally designed and easy to navigate. It should offer useful features and information, and have easy-to-find and properly labeled pages.
It should also be performance optimized, which means using smaller graphic image files for quick loading. He also recommended not using music, lengthy intro movies or clip art.
Communicate your goals to your Web site designer and hire a company with credentials, not your nephew because he’s cheap and knows a little HTML, said Dupper.
A professional site can range in price from $2,000 to $10,000.
Set Reasonable Goals and Never Stop Moving Forward
During his interactive seminar, “Limo 101,” Eric Weiner, president of All Occasion Transportation in Providence, R.I., pointed out that operators must set attainable goals that take into account the rising costs of doing business, which may force them to adjust their pricing and their business plan. The key is to be able to adapt quickly and remain flexible.
“Any time you reach your goals, you can stop for a moment,” said Weiner. “But you should then set new goals and start climbing again.”
Long-term success requires staying motivated and keeping the needs of your business on the front burner. Don’t be afraid to compete against the big boys, added Weiner. Technology can help level the playing field against larger competitors. Weiner broke out technology into the following categories: computers, software, the Internet, in-vehicle technologies and HR testing.
Technology impacts the four major areas of a limousine company, which include marketing, customer service, finance and vehicles.
Marketing, which comprises sales, advertising and promotions, brings business to your door. Weiner urged operators to be price sensitive, but not price obsessed in their marketing.
It would be dangerous to ignore price as a component of sales, but it should not be your primary selling point. Know what your competitors are charging as well, Weiner noted.
Always look at price, but if someone is significantly lower, be skeptical. They may be destined for failure if they don’t charge enough to cover their costs, Weiner cautioned.
It’s important to remember that some of your best customers are your dissatisfied customers, Weiner said. They’re the ones who will teach you where your operation might be weak and need improvement.
Weiner challenged attendees to focus on their own definition of success in their business. His personal definition has changed during the 15 years he’s been in business. Weiner said that making a lot of money isn’t as important as other goals, such as providing real opportunities and a positive work environment for his employees, and making sure he has enough personal time to focus on his health and time with family.
Laying the Groundwork Can Avoid Employment Lawsuits
Attorney Jeffrey Englander of New York, N.Y.–based Morrison Cohen LLP advised seminar attendees to have thorough hiring and firing practices in place to create a solid working environment and to avoid legal hassles later on.
Having a clear-cut policy in place for wage practices is essential, especially relating to overtime payment. Avoiding problems with wage and hour claims is dependent upon maintaining meticulous time-keeping records.
Anti-discrimination laws relating to race, national origin, gender, pregnancy, mental or physical disability, age and marital status were also explored during the seminar. Companies must be very careful when taking action with employees relating to political, union or “whistle blower” activities.
Of course, it all starts with proper screening and hiring practices. Employment applications must expressly state that misstatements or omission of relevant facts may result in dismissal. Also, it should be clarified that employment offers are contingent upon the total pre-employment screening process.
When drafting employment offer letters, there are several issues that must be spelled out starting with the basics: start date, base salary and clarification that employment is “at will” and terminable by either party with or without cause or notice. Other issues to cover include a statement that the employee should not be barred from accepting this offer because of other agreements, and that employment is contingent upon passage of background screening, drug testing and verification of the legal right to work in the U.S.
Gerber Offers Radical Approach to Struggling Small Businesses
Most small businesses don’t survive because the owner doesn’t approach the business as an entrepreneur, said Michael Gerber during his keynote presentation, “The Small Business Revolution Has an Impassioned Leader!”
Almost 70% of all small businesses consist of one guy knocking his brains out day after day, Gerber said. “He’s a technician who created a job for himself and now he’s working for a lunatic.”
In the limousine industry, this generally happens when a driver decides he can run a better company than his boss. Gerber called this a technician suffering from an entrepreneurial seizure.
Experience is actually the worst teacher, Gerber said. You have to get out of the car and step outside of your business so you can look inside to see where true opportunity lies. Otherwise, you spend every day just doing it, doing it, doing it, which is often a painful existence doomed to failure.
Gerber said that operators need to build a business that is systems dependent, not people dependent. They must have an entrepreneurial perspective, not a business perspective. “The system runs the business and people run the system,” noted Gerber. “The technician doesn’t want to hear this because he has too much to do.”
Gerber concluded by saying you can’t fix an old company that is not working. You have to start from scratch. If you try to fix the old company you will get bogged down in all of its problems.
Gerber has been leading a small business revolution for over two decades and has inspired hundreds of thousands of small business owners throughout the world with his insightful E-Myth message, which was documented in his mega-best seller, “The E-Myth: Why Most Small Businesses Don’t Work and What To Do About It.”
Cutting Through the Clutter With Powerful Advertising
The average American is exposed to 1,600 advertising and marketing messages a day, up 45% since 2001! Julie Dorr, director of business development for Bobit Business Media, presented 12 tips on breaking through the advertising clutter with targeted, effective messages.
It all starts with knowing and defining your audience, Dorr said. It’s critical to understand what their needs are and how they book chauffeured transportation services. The seminar explored various advertising methods including Internet, mail and Yellow Pages ads with an emphasis on tailoring these channels to a targeted audience with the right message. One of the keys to finding the right message is clearly defining your brand image with a clear focus on value, integrity, positioning and image of the brand.
When designing an ad, Dorr said, try to use the three magic words: free, new and save.
Audience participation reached an all-time high during the seminar when the usage of Art Gallery clip art CDs was discussed. Some of the ideas mentioned during this segment included adding free downloads to your Web site from downloads.com, taking pictures of clients and giving clients a photo CD.
The end goal of all these marketing techniques is to make customers loyal advocates, people who buy services from you regularly and consistently refer business to you. To keep advocates, you must constantly provide them with incredible service and let them know they’re appreciated.
Listen to Clients Before Creating a Proposal
Before responding to a Request for Proposal (RFP), operators should set up a preliminary meeting and use that time to determine what the client wants and needs, Ron Sorci noted at his seminar, “Corporate Proposals That Work.”
“People have a tendency to walk into that meeting as a salesperson, when they should be listening to what the potential client has to say,” said Sorci, CFO of Aventura Limousine & Transportation in Aventura, Fla. “Take notes that will allow you to better prepare for your proposal, which is where you should be selling yourself.”
Sorci also recommended developing a value-added program for the proposal. Be creative and think of ways to sweeten the pie, Sorci said, which may include complementary transportation. Just be sure to set revenue benchmarks that must be met in order for the client to enjoy the free trips.
Operators need to be careful about locking in rates, particularly during volatile periods when fuel prices are on the rise, warned Sorci. Clients may try to lock you into a set rate for one year or more. You need to put in an escape clause that you can add a fuel surcharge to ensure the work is profitable just in case fuel prices skyrocket unexpectedly.
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