Sam Mallikarjunan of HubSpot can help you prepare your business for inevitable future shake ups.
People get into the limousine business for all kinds of reasons. Gordon Gooch, owner and founder of Admiral Limousine in Pleasanton, CA, jumped on the bandwagon because he thought a limousine would be "a neat car to have." Well, that was four years ago, and now Gooch has eight neat cars. Not bad for a 28 year-old former am balance driver, eh?
Gooch decided to start a limousine service after talking to a chauffeur whose car was waiting outside a movie theater. When Gooch asked him about starting a business, the chauffeur said, "You've just got to get a car and a phone number."
The phone number was no problem. The car, on the other hand, took some quick thinking and some fast talking.
"First I asked my girlfriend Robin's father if he wanted to be a driver," Gooch remembers. "He said 'Sure,' so I went down to the local Cadillac dealership and priced a brand new formal. Then I went back to Robin's father and asked if he wanted to be a partner instead."
Robin's father, Russell Johnson, agreed and, on December 7th, 1983, Admiral Limousine was born, boasting one 1984 silver Cadillac Formal.
Gooch and Johnson, a retired police officer, passed out business cards, talked to travel agencies, and soon realized they were going to need another car. They bought a 1980 black Cadillac Standard and continued to work; doing mostly air port runs and weddings.
"We were debating whether or not to buy a stretch," Gooch says. "And we realized that you can't be in this business and not own one." At least not in Pleasanton, which is in the San Francisco Bay area.
One day, when he had some time to kill during a charter run, Gooch went to a Cadillac dealership, just to look. He saw a Williams Cadillac stretch with a side console. Gooch had never seen a stretch with any thing but a center console, and this innovation really impressed him.
Gordon was able to get financing and ordered the car, a white 1984 model with blue interior. "So we had three cars our first year," he concludes proudly.
At this time, Gooch was driving on his days off from the ambulance company. Johnson, who later be came Gordon's father-in-law, was driving on his days off from his job as a part-time security guard. After Johnson suffered a heart attack, Gooch quit his job at the ambulance company and became a full-time limousine owner/operator.
Jump ahead to April of 1987. Admiral Limousine was making enough money to move from Russell John son's home into its own office and garage facility. The company had seven cars and was awaiting delivery on its eighth. Six of the eight are stretches, three Cadillacs and three Lincolns.
"At first we thought Lincolns were too square," Gooch confesses. "Until you get used to them, they look like aircraft carriers from the driver's seat because the hoods are so long. But we were having some mechanical difficulties with Cadillac, so we decided to try them."
All six of Admiral Limousine's stretches are built by Williams. Of all the cars he's seen at various limousine shows and dealerships, Gooch believes that Williams has the best quality. Also, he is quick to add, they seem to design their coaches with the passenger in mind more than some of the other coachbuilders.
1987 was also the year Gooch decided to advertise in the Yellow Pages. "We wondered if it would be worth the extra $100 a month," Gooch says. "Finally we decided that, if we get one round trip airport run from it a month, it's paying for itself.
"We have the drivers ask new customers how they heard of us," Gooch continues. "Most of the time it's referrals, but the Yellow Pages ad is popping up more frequently. The way prices are these days, people call everybody trying to get the best price."
Speaking of price, how does Admiral Limousine handle undercutting and other problems that occur in a competitive market like the San Francisco Bay?
"If somebody calls me and wants prices, I tell them that when they ask a company about prices, they should also ask what type of cars they have. I warn them that they might get a great hourly rate and a piece of junk car that hasn't been washed for three or four weeks," Gooch says.
"Then I explain to them what our cars are equipped with, how many people they'll seat, and the color of the car. I suggest they ask other companies for the same information. Most of the time they call us back."
Gordon Gooch is so casual about his company's success that you might imagine that he just bought a car and sat back while the business poured in. Dig a little deeper, however, and you discover that it wasn't — and isn't — like that at all.
"I can't tell you how many 20-hour days I've done," he says. '"Now that we have an office and five full-time drivers, I'm supposed to spend most of my time in the office, rather than driving. It hasn't worked out like that, though. We're just too busy."
Not only does the owner of this company drive his cars, he washes them too.
"I bought a pressure washer that uses hot water and soap, he says." That makes it faster, and a lot more fun. Maybe it sounds funny for the owner to be washing the cars, but we're a small business, and it gives me knowledge of what's going on with the cars. A lot of companies have someone, maybe a high school kid, come in and wash the cars. Well, it's just a job to him."
To Gooch, however, washing the cars is a good way to stay acquainted with the physical condition of his cars. "Right now, we just have drivers write notes about any main tenance problems with the cars, but I want to start keeping a file on each one, and have maintenance records and forms printed up. As you get bigger, you have to think about these things."
You also have to think about the most cost-efficient way to keep your cars maintained, especially if you're still making payments on all but one of them. Gooch takes his cars to a ten-minute oil change shop where he gets a fleet discount.
For tires, he goes to a store that offers free rotation, valve stems, and flap service. Tuneups, as well, are taken care of at a discount repair shop.
Gooch believes that the upkeep of his cars is one of the major reasons for his company's success. Another major area, of course, is the quality of service he offers.
Aside from the basics, like being ten minutes early for pick ups and being polite at all times, Admiral chauffeurs do special things for their regular clients, like stocking their favorite beer in the refrigerator before picking them up in the afternoon or evening. They also supply a complimentary bottle of champagne with every charter.
"I know of some companies that offer free champagne for all their runs," says Gooch, "but I think that's a waste. An executive on his way to a big meeting is not going to be interested in a rose and a bottle of champagne."
Special deals on fares are possible with Admiral as well, depending on the situation.
"The good thing about being your own boss," Gooch says with a smile, "is that you can make decisions. Some of the bigger companies aren't flexible, and they can't make snap decisions. If it's slow and somebody calls up wanting a charter, we can cut the hourly rate.
"If a customer calls up for price in formation, rather than just give him a price, we'll ask him what he wants to do. On a weeknight, we might take them out to a restaurant for dinner and pick them up afterward, and charge only the three-hour minimum, even though it takes eight hours to do the whole thing."'
Admiral Limousine also provides special all-day trips with a per-trip, rather than hourly, charge. One of the most popular of these is the Napa Valley Winery Tour. A limousine will pick the clients up early in the morning and drive them to Napa Valley, where they spend the day at the winery of their choice.
While Gooch believes that pleasing the customer is his first priority, he won't do it at the expense of his employees.
"One party sprouted into a six car job and they wanted us to drop the hourly rate," Gooch remembers. "They wanted to be dropped off at a party at seven in the evening, picked up at one in the morning, and driven around for a few hours." That, of course, would mean that the drivers involved would have to work nearly around the clock.
"I told my partner that the drivers would be out until about five in the morning, and it wasn't worth it," Gooch says. "We want to take care of our drivers. After all, they represent the company."
Admiral's chauffeurs work on a modified on-call basis. Russell John son assigns trips a day in advance, but there's always the possibility of new reservations coming in after the day's work has been planned.
For airport and business runs, the chauffeurs wear suits and ties. Admiral splits the cost of a tuxedo with each driver as well, to be worn for proms, weddings, and other special affairs. For multi-car affairs, the drivers dress alike. Gooch believes that this presents a more profession al impression.
The clients are one of the perks of the business as far as Gooch is concerned. "Some of the clients treat you like family," he says. "They'll talk to you, invite you out for dinner and not take 'no' for an answer. It's a good feeling and really makes it all worthwhile."
Gooch says that he never expected the business to take off the way it did. "We just figured we'd get a car, get a phone number, and do the job," he says. "We never dreamed that in four years we'd go from one car to eight. Who knows what it's going to be like four years from now?"
He does plan to add at least one more car in the next year. After that, he may wait a few years before expanding any more. He and his wife just had their first child, a little boy named John, in January, 1987, and Gooch would like to be able to spend a little more time with his family. Of course, he'd also like to win the California Lottery.
"If I win," he says, only half joking, "I want it to be big, like 20 million dollars…a million a year. Maybe we'd get somebody else to run the company for a while. We wouldn't get rid of it, though. It's my life now. I don't think I could ever get completely away from it. It's a lot of work, but I love it."
While Gooch says that the business requires a lot of hard work, he also finds time for fun on the job. For one thing, he says, "It's fun to see how the other half lives. You put your tux on and walk into the Fairmont Hotel in San Francisco like you're really somebody.
"One time, I was picking up a really good regular customer from the airport," he recalls. "I knew this guy's sense of humor, so I wrote the name Bruce Willis on the airport sign. I figured he'd be one of the first people off the plane, we'd get a few laughs, and that would be it. But he was one of the last. By the time he got there, I had a whole crowd of people behind me, waiting to see the star."
A little childish? Maybe. But, as Russell Johnson reminds people when they make that charge against his son-in-law and business partner, he's young. And he's off to a roaring start.
Sam Mallikarjunan of HubSpot can help you prepare your business for inevitable future shake ups.
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