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Bus and Motor Coach Library

Are You a Loyal Customer?

Author – Debra Mintz (2003)


Over the last decade, we've seen many coach companies fail and still even more teetering on the brink of financial ruin.  Yet there are a number of bus companies who have remained successful.  We need to ask ourselves why some operators are succeeding while the vast majority is failing to turn a decent profit. 
The common thread found among many successful operators is their appreciation for loyalty - both in giving and receiving.  These companies have many loyal customers who wouldn't dream of using another motorcoach carrier.  These companies also have employees that are loyal to their organization and more importantly, are loyal to the owners.  Operators that appreciate their customers' loyalty do so by consistently providing quality coaches and safe, excellent service.  Operators that show appreciation for their employees' loyalty do it sometimes monetarily and sometimes just by simply saying "thank you for doing a great job".

These are the companies that enjoy repeat business, very high employee retention rates, have fewer accidents and are able to pay their employees more because they are not constantly wasting their money on the costly hiring and training of new staff.   

There have been numerous articles in our industry publications dealing with improving customer and employee loyalty but there is one area of loyalty that is rarely discussed within the industry and it is of paramount importance to any company's long term success: Loyalty towards Your Suppliers. 

The operators that are prospering today are doing so because they have surrounded themselves with a network of people that truly want them to be successful.  Customers, Employees and Suppliers are the three components in all businesses.  If you agree that you can not run your business without these three components, you must conclude that you need for all of them to be as supportive as possible in order for your business to have a chance of being profitable.  

As a consultant, I've been asked repeatedly to help turn around failing carriers.  Unfortunately in many circumstances, the carrier has waited far too long before asking anyone for assistance.  Usually this is because the operator believed that he couldn't afford to pay for professional advice and is only calling us now out of a sheer sense of desperation and panic.  Many of these "past the point of no return" operators are facing the loss of everything because they failed to learn the key to successfully managing and growing a business.  It's simple.  You Cannot Do It Alone!

If you want to have a successful company then you must surround yourself with bright, talented people who want and need for you to succeed.

Considering that my company's success is based on generating consulting fees, you may be surprised that my standard response to operators is that they should have been reaching out for assistance from the day that their company was formed.  Not by hiring consultants but by just speaking with some of the many talented people in our industry that they are already know.  Unless the operator is failing due to some type of catastrophic loss, chances are that their business has been failing because they have not managed their company using sound business practices. 

Sound business practice means that you take full advantage of all of the information available to your industry.  You read industry magazines and you attend as many state and national association meetings as you can.  When your insurance company or other supplier holds an educational seminar, make sure you attend. Sound business practice also dictates that you should determine what you are good at doing and get help with everything else that has to be accomplished at your company.  Very few of us are good at both marketing and operations.  Very few of us are good at doing our own accounting.  Very few of us are good at every facet of business management.

By honestly accessing your abilities and the abilities of everyone else that works for you, you should be able to clearly see where you need some help.  Once again, I'm not necessarily advocating that you hire a consultant.  Sometimes the type of guidance that you need can be obtained by placing a few phone calls. This is where we get to the importance of being a loyal customer. 

First let's discuss what is a loyal customer?  If you are an operator you probably believe that some of your customers are loyal and therefore valued because they always do the following:

- They only work with your company
- They rarely cancel orders at the last minute
- They pay for your services on time
- They don't complain or threaten to take their business away when you have to raise your rates
- They treat you and all of your employees with respect
- They recommend your company whenever possible
- They send you a letter or email whenever your employees do something very well
- They send you a letter or email whenever something doesn't go well with your service

            Now based on the list above, which is what you want from your customers, can you honestly say that you are a loyal customer towards your suppliers?  Are you guilty of switching from long time vendors just to save a buck?  Are you guilty of forgetting about the numerous suppliers that assisted you when you first started your motorcoach company?

Remember the company that financed your first coach even though you really didn't have enough assets to justify the deal.  Remember the guy who sold you your first new coach because you were absolutely convinced that adding one to your fleet would change your company's image?  You couldn't really prove on paper that you were going to be able to pay for it but that guy believed in you and pulled some strings in his company to make the deal happen.  Remember your broker getting you insured even though you had no experience running a coach company?  Remember your insurance company when they paid out a huge claim because the driver you hired wasn't up to snuff?  Remember how they still insured you after that? 

Remember the guy at your parts supplier who stayed late because you just had to have that part immediately?  Remember how he didn't say anything sarcastic regarding your lack of inventory? Remember when your finance company offered to put a payment that you couldn't make on to the back end of your lease?

Successful operators remember each and every person and company that helped them to become successful.  They stick with their suppliers and their suppliers know it. They do not switch suppliers unless the product or service becomes inadequate or inferior, or their supplier's sales contacts or management people with whom they have had a close business relationship have changed.      

You see, what many operators fail to recognize is that their suppliers will do everything within their power to help a loyal customer succeed.  Your major suppliers have something that many of you do not have within your own organizations.  They have management committees, marketing specialists and in-house legal experts.  They have on-staff or access to experts in every facet of business management. They rarely implement anything without first thoroughly discussing the concept and they always get numerous opinions before doing so. You may know what is happening with other coach companies in your area but your suppliers have a wealth of knowledge regarding what's happening with operators all over the country. They know what has worked well for operators, and of greater importance to you, what has failed.

You may be wondering, what kind of assistance your suppliers can offer you?  The truth is that they can help you do just about everything better and more cost efficient.  Sometimes your supplier may even come up with a great idea for your company. For example, one of my claims to fame was that I was the first operator in North America to "Full-Wrap" my tour buses but the idea to sell advertising on my fleet came from one of the bus industry’s leading insurers.  It was just one phone call that started it all.  You see at that time, I wanted to add many new Prevost coaches to my fleet but I just couldn't afford it.  I called my insurer to ask them what they would do if they were in my position. They suggested that I should think about selling advertising on my airport buses.  The idea may sound simple to you today, but remember that this was more than 10 years ago and at that time only transit buses sold advertising.  I doubt that TIB ever imagined that I would completely cover my buses from stem to stern but that's where the idea began.  That's where many great ideas often come from… simply asking questions of those in the know.

When I look back (very fondly) on my motorcoach companies and think about all of our accomplishments and industry firsts, I have to give much of the credit to my suppliers.  I was loyal to them and they in turn watched my back and absolutely helped me every step of the way. 

Would you think to have the head of marketing at your insurance company or coach manufacturer look over your Yellow Page advertisements or a new brochure?  Would you call your parts supplier or coach manufacturer to help you set up a more efficient maintenance shop or review a new route that you're thinking about adding? Would you ask your fuel supplier for the names of coach companies who are slow in other states when you are busy and require additional equipment?  Would you call your insurance broker to ask him what bank or accountant you should be using?  Would you ask your largest supplier to ask their printer to extend their large volume discount rate to you?

Well I asked those kinds of questions and many more like those and my suppliers usually came through for me.  The reality is that you can not discuss company issues with your local competitors.  They do not want you to succeed. Thankfully, if you are a loyal customer, you can create your own group of expert advisors by speaking regularly with your suppliers. 

Remember a loyal customer also has an obligation to share bad news about their company with their suppliers.  That means when necessary, periodically making the dreaded phone call to inform a supplier that your payment is not going to be on time.  No supplier likes hearing that news but you will separate yourself from the other late payers if you call your supplier to let them know your situation before you are late.  Please don't make them chase you down.  They really hate that and when you don't take or return their calls they may assume that your situation is worse than it is.  Take their calls and be honest about your situation.  Don't tell them that "the check in the mail" or send a check that you "forgot" to sign.  They really hate that.  If you know when you can make the payment tell them, but if you really don't know when that will be, be honest and forthright about it.  They just might be able to assist you in improving your cash flow.  Don't be afraid to show them your books.  Remember they want to help you.  The last thing that they want to do is shut you down or lose your business.

Now you may be saying to yourself that the reason your business is failing is because of a general downturn in the economy and in the travel business.  There is no doubt that many operators have been greatly affected but you have to ask yourself, how long can you continue to justify your poor balance sheet?  Be honest with yourself, was your business really that much better in previous years?  Perhaps your coaches were busier but were you really that much more profitable?

Surely one must recognize that in order for a company to achieve better results, one has to change the way that one does business.  One way is to begin networking with your suppliers and asking for their suggestions on how you can improve your bottom line.

Too many operators that I speak with are “waiting for their businesses to return to normal.”  My response to that comment is “What exactly are you waiting for to happen?” Successful operators don't wait for things to happen, they make things happen!

Look at the successful operators in your area and if you don't know one, call your suppliers and ask them which operators in other parts of the country are doing well.  I guarantee that what you will find out is that successful operators are doing things very differently now.  Some are selling food and beverages onboard their coaches.  Others are selling advertising inside their coaches while others sell it on the outside of their coaches.  Some have started new scheduled services.  Some have started new sightseeing tours and some are going after charter groups that they did not do business with in the past. You now see more upscale coaches modified to the more spacious 2+1 seating configuration.    Most successful operators know the value of maintaining warm and personal relationships with their suppliers and speak with them on a regular basis. They are loyal to and appreciate their suppliers and know that their suppliers also value their business and friendship.  They take the time to get their suppliers' opinions before implementing changes to their organization.  They ask for help with strategies to improve their marketing and product positioning.  They ask their suppliers for recommendations and referrals.  They call their suppliers when they can't make a payment on schedule. They discuss with their suppliers the problems and possible opportunities that they are dealing with today and what their hopes and dreams are for their company's future.  Sometimes after a particularly rough day, they even call their favorite supplier just to get a good old fashion pep talk, because that’s sometimes all we have on some of those days when we question why we are even in this business!   
Make the effort to become a more loyal customer, and you will soon see that your suppliers will become more loyal to you.  You'll be amazed at how much you can accomplish when you get the proper guidance.  Your suppliers do not want to run your companies but they are there to help you.  All you have to do is ask.  Remember they are only sharing their opinions with you.  It is still up to you to make decisions.  Don't you owe it to yourself to get as much sound advice as possible before you make those decisions?    Have questions or comments? Corporate Coach Consultants can be reached at (561) 995-6948 or by email at DebraMintz@aol.com                                     

Debra Mintz, is founder and principal of Corporate Coach Consultants (CCC), a consulting firm headquartered in Boca Raton, Florida.  CCC specializes in strategic and tactical marketing, operation/management restructuring, new product launches, special event coordination, corporate coach acquisitions and operations and coach/trailer advertising. Debra's clients include many of the largest operators, manufacturers and high-end converters in the North American motorcoach and truck industries.  Debra also brings more than twenty years of hands-on experience as the former president of Airport Cruiser, Inc. and the former general manager of Lounge Car Tours Charter Co., Inc. both major California based motorcoach carriers.  
            During that time, Debra developed a number of innovative management techniques and services, leading to Lounge Car being ranked in a 1984 nationwide travel agent survey as the 5th most recognized motorcoach company in the U.S.  Her company, Airport Cruiser achieved a record 98% on-time rate for four consecutive years, while recording the lowest employee injury rate of any transportation company in California.  Her marketing and sales efforts resulted in providing motorcoach services to 92% of the packaged tours sold to the Disneyland area, and included unprecedented motorcoach advertising contracts with Walt Disney Attractions and the Rank Leisure Corporation.  Additionally she developed internal policies and procedures in maintenance, safety, training, and employee relations leading to substantial improvements in efficiency, profitability and employee retention.