Sam Mallikarjunan of HubSpot can help you prepare your business for inevitable future shake ups.
Joe and Barbara Pastelak discovered a limousine service for sale in 1976. The company had been idle for several months. The “business” had neither customers nor employees to offer. The only assets were three older Cadillac formal limousines.
Joe and Barbara sensed an opportunity, however, and entered the limousine business in August of that year. Joe brought the three limousines to their home and put them into good working condition. Then he and Barbara waited for the phone to ring. Unfortunately, that did not begin to happen consistently until their Yellow Page ad appeared the following spring.
Gradually, business increased and Gem Limousine began to specialize in corporate transportation. After sending letters to corporate travel offices, Barbara followed up with personal calls during which she described the quality of their service.
Gem Limousine established a solid reputation among corporate travelers and eventually grew into a successful fifteen-car company. Joe and Barbara will start ’87 by moving the company out of their home and into a 6,000 square foot building which will accommodate both offices and vehicles.
From the very beginning, Joe and Barbara have been active in the New Jersey Private Livery Association. Barbara credits the association with helping them learn about the limousine business. They have also found their membership in the National Limousine Association to have been very helpful.
Barbara still vividly remembers her beginning in the limousine business. “We bought three limousines from someone who was retiring,” she says. We didn’t really know anything about the business. At that time, the New Jersey Private Livery Association was just starting and we got a phone call asking if we wanted to join. We met a lot of nice people who helped us and gave us some extra trips they had. That got us started.”
Located in Linden, NJ, seven miles south of Newark Airport, Gem specializes in corporate work. “In this business, everyone has to specialize in something,” Barbara says.
Prior to buying Gem Limousine, the Pastelaks were in the construction business. Although they had background in business, Barbara felt unprepared for the kinds of challenges they encountered as limousine operators.
“The limo business is entirely different than I thought it would be, I never thought I’d be working twenty-four hours a day, seven days a week. That’s the type of business it is.”
Gem started with a ’72 Formal Cadillac and two ’73 Formal Cadillacs. At that time, Joe and Barbara felt that they could use those cars for weddings as well as corporate work. It worked well for two years. Then they decided to buy their first new limousine.
To find business to support their two vehicles in the early years, Joe and Barbara went to wedding shows, travel agencies, and tuxedo shops to promote the business. “It was just Joe and myself,” says Barbara.
Joe maintained the cars and did most of the driving as Barbara remembers. Barbara drove a few times and then began spending most of her time working in the office and promoting the business.
“In the beginning, I did a wedding,” says Barbara. “The next day, the aunt of the bride called up and said, ‘Your cars were so nice and clean,’ and she talked about how nice the wedding went with the limos. She said, ‘I want to do the same thing with my daughter’s wedding but the driver took so much away from the bride, I don’t want any women driving.’ In those days, a woman driver took away from the bride.
“Today, I think it’s more acceptable to have a woman driver,” Barbara continues. “With our type of corporate work...the men are gentlemen and they like to open a door for a lady, and carry a bag for a lady. They’re uncomfortable with a woman chauffeur carrying their bag or opening their doors.”
Barbara also remembers how difficult it was to attract customers during the first year. “It was very hard not having any jobs and not knowing what to do or how to get jobs,” she recalls. “When our ad came out in the Yellow Pages, our phone started ringing. Yellow Page advertising is what really started us going. We started the business in August and the ad didn’t come out until the following March. That was a lean time.
“Everything else we tried didn’t work. We went on the radio and, if you don’t go on the radio continuously, it doesn’t work. The same thing with newspaper advertisements.”
How did the Pastelaks learn how to run their company? “You learn by trial and error,” admits Barbara. “You work with relatives and friends. We didn’t have that much work in the beginning so we had relatives and friends part time. It was probably a good six months before we hired a full time driver. We hired a lot of part-time people.”
One thing in Gem’s favor ten years ago was a relative lack of competition. “There weren’t half as many companies in ’76,” says Barbara. She recalls that the limousine boom in New Jersey really started when Atlantic City was revitalized as a resort. Gradually, business increased and Gem added two more cars in ’78...a Cadillac sedan and a new Cadillac formal.
At the time, Barbara wasn’t sure whether they were really ready for new cars. “That was Joe’s idea,” she says. “He felt we should have newer cars to show corporate people that we were really trying to cater to them with upgraded equipment. I didn’t know if that was the right thing to do at the time...but it was. You can’t serve your corporate people with old equipment.”
Now Gem operates fifteen cars including eight sedans, six corporate stretch limousines, and one super-stretch limousine with a bar and TV. The corporate stretches have bench-seats, and a bar console.
Joe and Barbara also plan to add a van to their fleet. “We will use that for airport trips, and for trips where there are ten people going into the city who want to go in one car. You can’t fit six people, and their luggage, in a Cadillac…it’s too much weight,” says Barbara. “We decided a van would be the way to carry six people to the airport with their skis and their golf bags or extra luggage. We think it will be an asset to the company to have a van.”
From their very beginning in the limousine business, Joe and Barbara found their local limousine association very helpful. “They really got us started,” Barbara believes Barbara still serves on the board of directors of the New Jersey Private Livery Association, a group which numbers approximately a hundred members.
“We just had our tenth anniversary dinner dance last November,” says Barbara. “It was wonderful. We had help from a lot of people in the association. We have a nice group of people in the association who help each other. If you have problems, you can talk to them. I’ve also joined the National Limousine Association. We find that very helpful. We meet people from all over the country there,” she says.
January ’87 marks a milestone for Gem Limousine. After ten years of operating in their home, Joe and Barbara plan to move into a 6,000 square foot building in Linden which will house company offices as well as vehicles. The new facility will allow the company to continue adding vehicles. “We can probably keep as many as thirty-five cars there,” Barbara anticipates.
Gem’s growth to twenty-five employees has finally necessitated the move. The new facility figures to be a relief for Joe and Barbara who have lived with their work for the past ten years. “Fortunately,” says Barbara, “we have been able to take vacations occasionally because we have competent people that we can leave the business with. That means a lot.”
Joe and Barbara credit their drivers as the biggest reason for the company’s success. “I feel that the drivers make the company,” says Barbara. We have girls in the office who can sell over the phone, but once the driver goes out there to make that first impression, that determines whether they’re going to use your company or not. I’m awful proud of our drivers. I think we’ve got the best drivers of any company. Because of insurance, our youngest driver is 25, and our oldest driver is 62.
“With our full-time drivers, the job turns into a career. We do have turnover, but it’s not as great as other companies from what I hear. It means a lot to a person coming off a plane to be able to recognize a driver rather than to get a different driver every time.”
Another thing that helped the company grow was the addition of a 2-way radio system. Being able to continually communicate with all of the cars allowed Gem to more easily handle runs on short notice. Few other services had 2-way systems according to Barbara.
“Everybody who knows that I have them can call and say ‘Can you cover a job here? Can you cover a job there? Do you have a car at Kennedy?’ It’s really helped us get extra business. Our corporate executives like that a lot because we know exactly where our cars are We’ve had that system about eight years and it’s been a big plus.”
Sales calls have also been important in building corporate business This part of the marketing process begins with letters which are regularly mailed out to corporate business prospects. When a company calls to request more information about Gem, Barbara goes out to describe the quality of service offered by her company. It has taken years to build up a corporate clientele, and Barbara has encountered very stiff competition. “There’s always somebody knocking on the doors of the corporate travel departments looking for their business,” she says.
Barbara also visits her major corporate customers regularly to make sure they are satisfied with Gem’s service. “I try to go out and listen to any complaints they have,” Barbara says. “I think it’s real important to get out there and meet with them every month. Sometimes they have ideas that help us improve our service.”
As far as ongoing effectiveness is concerned, nothing has continually brought more business for Gem Limousine than the Yellow Pages. Gem runs an ad in five books in the area. Barbara places quarter page ads in most of the books, and uses smaller ads in directories that are farther out from their operating area.
In their ten years of operating limousines, Joe and Barbara have watched the industry evolve from an industry with a limited market, to an industry with an almost universal appeal. “It’s no longer just a luxury for the rich,” says Barbara. “It’s a necessity for the businessman as well as for the traveler and the person on vacation. It’s something that’s expected now rather than a luxury.
“In the last two years,” she continues, “I’ve seen the business turn from a limousine industry to a sedan industry. I think that has a lot to do with terrorism. Executives are afraid to attract attention to themselves in a stretch limo. They want to keep low-key. Also, companies don’t want to show that they’re making a lot of money by sending executives out in a big stretch limo.”
Another industry trend noticed by Joe and Barbara has been the entry of many independent operators into the business. “We went through a period in which people lost their jobs,” says Barbara. “Atlantic City was opening up...and everybody thought, ‘Let’s buy a limo and go into business.’ A lot of people did that.
“When they didn’t get all the trips to Atlantic City they expected,” Barbara continues, “they started doing airport work at low prices to keep the car going. They didn’t have proper plates and proper insurance. This is one of the problems that I think our association is going to crack down on. Until the public is educated, they don’t know any better than to use these people. It’s really hurt us.”
Joe and Barbara have persevered, however, by offering quality service, continually promoting the business, and involving themselves with industry associations. Barbara and Joe credit much of Gem’s success to office manager Elsie Pepe. Pepe is Barbara’s secretary and “right hand man.” “Her loyalty and dedication make her respected by everyone. She is a workaholic who loves her job,” says Barbara. Another key employee is Gem’s reservationist Debbie Mazza. Debbie operates the company’s IBM computer which handles reservations, billing, and tripsheets.
Night dispatcher Bob Meehan is in charge of all the drivers. “Between Bob and myself, we have just put together a chauffeur’s manual,” says Barbara. “It tells the drivers everything about the company. It’s filled with maps of different areas, phone numbers of all the airlines to check flight times...radio codes for the drivers...all the rules and regulations about what we expect from the drivers...how to dress, act, and groom. We worked on it for six months and handed it out in September to every driver.
“It’s become another selling point when I go to a new company,” she continues. “I show them our chauffeur’s manual and explain what drivers are expected to do. It’s been very effective. That was Bob’s idea.”
Having Bob supervise the drivers has been a relief to Joe and Barbara. It has also given the drivers someone impartial to go to when a problem develops. Another key employee is daughter Deanna who started working in the office after school this year.
Looking back over ten years in the business, Barbara is pleased with her experiences in the limousine business. “As much as I complain about it,” she says, “and as much as the problems and breakdowns get to you, the limousine business gets inside you and you develop a love for it. I wouldn’t want it any other way.”
Sam Mallikarjunan of HubSpot can help you prepare your business for inevitable future shake ups.
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