Operations

Taking Risks To Grow

Michael Campos
Posted on January 23, 2012

The Great Recession caused global economic turmoil and led to the death of many a good business. Most companies that survived did it by downsizing staff and operations, and tightening their belts. But an elite few managed to adapt, evolve, and thrive during the economic drought; and an even smaller number did so with style, such as Lux Bus America in Anaheim, Calif.

The charter and tour operation started in June 2003. Six months later, CEO and owner Matt Brown — just out of college at the time — bought a small percentage of the company with his father, David Brown, and began the journey that would lead to the company’s complete overhaul and evolution into a premier luxury motorcoach service.

What kills good companies
The original owner of Lux Bus America saw 30 years in the bus industry before selling his former company to Coach America. After his non-compete was up, he attempted to revive his upscale per capita service that ran between Anaheim and Vegas but struggled. Brown came on board to help build the service, and as he started to figure things out, bought out the company principals and rebranded the operation.

In 2008, Lux Bus America expanded its charter side and had service running between Anaheim, Los Angeles, San Diego and Las Vegas. The company is setting up a hub in the San Francisco Bay area after signing a contract with a Silicon Valley tech giant.

Brown attributes his company’s growth and success to several things, starting with the philosophy of staying aggressive and avoiding complacency at all costs, something Brown learned by closely following other bus companies.

Lux Bus America's fleet of Prevost H3 motorcoaches.
Lux Bus America's fleet of Prevost H3 motorcoaches.

If you’re not growing, you’re dying
Whenever there’s a business opportunity, Brown is the first to be on top of it. He admits to having taken some calculated business risks, but says sometimes “you have to spend money even if you don’t think you have a chance, because if you don’t try, you really don’t have a chance.” He finds it important to stay fluid and be open to different things because opportunity can exist in places one wouldn’t normally think of looking.

“An extremely smart man I met — Jim Galusha of Silverado Stages in San Luis Obispo — told me, ‘If you’re not growing, you’re dying.’ And I agree with him,” Brown says.

Brown looks at his operation as a pie that’s divided up into slices representing different markets, and his goal is to keep those slices as balanced as possible.

Lux Bus America's ABC M1235 minibus.
Lux Bus America's ABC M1235 minibus.

“We knew we needed to diversify our service and we wanted to create a charter fleet of motorcoaches that would back up our per capita coaches when we needed it,” Brown says. “I noticed that other companies, really good companies, weren’t diversifying. They were shoved into one market — corporate, schools, sports, or tour and travel — and they just got beat up [when the recession hit]. As we grew, I wanted to keep our business pie as even as it could be in all areas so when one market dried up, we didn’t get smoked.”

Recession-proof
Brown and his team have identified what they call “recession-proof contracting.” While there’s no such thing as truly recession proof, Brown says certain markets are as close to it as you can get. “We watched what happened after 9/11 and during tough times in ’08 and ’09, and we learned that collegiate athletics still continued to thrive. USC is always going to play UCLA no matter what happens,” Brown says.

Sprinter vans are Lux Bus America's most recent fleet addition.
Sprinter vans are Lux Bus America's most recent fleet addition.

Influence and innovation
Brown looks for new ideas and business concepts by focusing on his surroundings when traveling by airplane or train. “I watch the attendants and how they treat irritable passengers; I look at the comfort levels and get ideas for what I want to put on a bus,” Brown says. “When designing the [interior of the] buses, there’s a lot of influence from airplanes and rail. I look at the seat spacing, the interior features. I pay attention to a lot of that.”

Brown is proud of the exterior design of his coaches, which all sport a uniform orange, silver and dark blue color scheme. Brown went through more than 20 different designs before choosing the final product. “We knew we had to create something that was simple, consistent, classy, and catchy, something that wasn’t gross, something that didn’t make you want to throw up,” he muses.

“Your coach is a half-million dollar chance to show your company to clients and potential customers when you’re driving around,” Brown says. “It’s your moving billboard, so do everything you can with that half a million bucks to enlighten people to what you have and impress them.”

Eric Peterson, Lux Bus America’s director of creative development, produced the designs. Peterson handles tech, web, search engine optimization, design, photography, advertising and marketing materials for the company.

Lux Bus America president/CEO Matt Brown, vice president of sales and marketing Michelle Eversgerd, and charter sales manager Teresa Harshfield.
Lux Bus America president/CEO Matt Brown, vice president of sales and marketing Michelle Eversgerd, and charter sales manager Teresa Harshfield.
Peterson and Brown combine their brainpower to devise and adopt innovative ideas. “We’re always thinking, there’s always a project in the works,” Brown says. “One thing we really want to do is give our clients the ability to track their buses in real-time through their phones using new GPS technology.” While Brown tries to keep his company as cutting edge as possible, he warns it must do so within reason because a company risks spending too much on unnecessary technology.

Holding it together
At the end of the day, an operation is kept connected by the people making it all happen, Brown says. “I can buy any amount of buses, I can get as many contracts as I want, but it all comes down to the people that are on the ground every day — especially the coach operators. It’s important to treat your people well and to have a team that shares your same vision and goals and takes pride in what they have.”

Related Topics: business growth, California operators, charter and tour, charter and tour operators, luxury vans, management

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