March 2010: Business Tips from Tom Mazza
If You are NOT Making a Living: It May Be Time for a BIG MOVE
The ages of 30 to 55 are your highest earning years. You will never be more capable physically and mentally than you will in those years. If you are not making a living and you do not have a realistic opportunity to make one in the next year, consider selling, merging, or closing your company.
It sounds harsh and you make think I have fallen off the deep end but I have been driven to this conclusion in the last 2 years. Too many people in this business are pounding their heads against a brick wall putting in incredible hours with little or no financial reward. They are stressed out, locked in an unhealthy lifestyle, and have little or no time for themselves or their families. And when you sit down with them, as I do, and analyze their Income and Expenses, it is almost impossible to see a bright light on the horizon.
My advice is to seriously consider a "Big Move". Do NOT sit still and eat up your "highest earning years" in a sea of debt with little or no chance at earning a living. Make the move; give your family and yourself a chance at a better life. TMC can guide you through any of the moves described in this article.
Merger: I would much rather own 50 percent of a business that had a chance to be successful than 100 percent of a business that had no chance. Sit down with your best friend in the business and consider merging operations. Reduce fleet, reduce staff, centralize in 1 location, and if necessary, put one of you on the phone and the other behind the wheel. Pay a professional to sort out the legal issues. Many issues need to be decided in writing before going live. A merger requires a change in your mindset but it also can reenergize you in a big way.
Sale: The obvious downside is that you are selling in a down market and your gross sales and profitability are off from years past. But if you find a strategic partner your company may be more valuable to them than to you. Your 20 rides a day that are marginally profitable because of your high fixed expenses, may be hugely profitable to a larger company. Be realistic! You have to tell a story to your potential buyer that makes sense. An inflated number produces nothing. A realistic number produces a deal. And if you are willing, you may land a job with the buyer which comes with a regular paycheck and seriously reduced stress levels.
Closing: This is obviously a desperate move that is rarely the right move. But in some cases, it is a better option to fold your tent, declare bankruptcy, and get a job. If you like the chauffeured transportation industry, you may be able to get a good job in the business. I made that recommendation yesterday to an operator that was so far under water he could be Jacque Cousteau. If you are in your highest earning years, you have to make enough to pay your bills and save for retirement. Social Security will probably cover only a portion of your expenses in retirement and be assured, you cannot work as hard at 60 as you can at 40. ALL of us need to be able to fund our own retirements.
If you have even a small book of business, it is better to sell that book to a competitor, even for an ongoing commission. The book has value if you are answering the office phone. The value of the book goes to zero if you stop answering the phone. If you are considering ANY of these options, I am here to assist. Contact tom@tommazza.com today.
Mazza Call Center LLC: A Solution for Overnight and Weekend Coverage
Since October of 2008, Mazza Call Center LLC has provided a small group of luxury limousine services with live reservation and dispatch services. Trained personnel working remotely, tap into the clients reservation software and provide the same service that an on site dispatcher would provide. Taking, changing, and closing trips, wake up and close out calls for chauffeurs, any service that an in house agent would provide is done by the Call Center at a fraction of the cost of an employee.
For more information on call center services, contact tom@tommazza.com
My Secret Crush: RETAIL
When the limousine business was flying high in '06 and '07, top operators would often tell me they would refuse retail business. "I don't want a bunch of kids puking in my car on Friday and Saturday night" they would tell me. "Who needs a bunch of high maintenance brides in my face all the time?" they would say.
Late in 2008, all of 2009, are what we call "game changers". It's getting better, all of us see it, but one way or another EVERYONE needs more paying customers.
I love retail for so many reasons:
- Cash flow: no billing, no chasing, no waiting!
- Happy chauffeurs: long trips, cash tips
- Low mileage generally on fleet
- Higher average dollars per run
- Easier to dispatch
Business is business is business. The retail customer wants a clean car, on time, with well dressed chauffeur who knows where they are going. If you have a strong system and training in place for a corporate client base, you can easily handle retail work. No experienced chauffeur will ever allow a problem in their vehicle. Screen your customers carefully, keep strong systems in place, and depend on experienced chauffeurs and you will have few problems. Sell the vehicles that you have.
I have trained thousands of chauffeurs with the majority working for corporate transportation companies. When I ask them about retail work, their response is overwhelmingly positive. They tell me it is much easier than the daily airport grind. They love less driving, cash gratuities, and interacting with people on THEIR special day. As an NYC chauffeur recently confided, "I have fantasies about choking the next rude Wall Street guy with zero manners that I pickup at LGA."
Remember your corporate clients get married, they go out in the evening, their kids go to the Prom. You have an infrastructure in place to accommodate them. Many of the "retail" companies are weekend businesses who do may not be giving the level of customer service that you are. They may NOT answer the phone 24 hours. Sell the vehicles that you have that are appropriate. You may not have a 14 passenger Hummer but your mini-coach may be perfect.
Let your corporate clients know that you are open for their weekend trips. Market your wedding service. Encourage your chauffeurs to let the clients know you are ready to provide service.
Undercover Boss: Discovering YOUR Company and Making it Better
My new favorite show is "Undercover Boss" on Sunday nights on CBS. CEO's of large companies like Waste Management, 7-11, Hooters, and White Castle went undercover and worked in entry level positions in their own companies. The information they garnered was eye opening. All the CEO's committed to change based on what they saw.
The limousine industry has a smaller version of "Undercover Boss" and TMC is in the middle of it. Led by my associate Dr. Yvonne La Mar, TMC has quietly been conducting intense quality control surveys for client companies. Dr. Lamar (who has a Ph d from Cornell University) and her team do an intense round of 30 to 35 calls in 1 month to a single client company covering all shifts and staggered at various times day and night. The callers present a variety of scenarios from making inquiries for rates, prices, and services to making and then changing reservations. In certain cities, mystery rides have been conducted.
Dr. La Mar's team uncovers tons of information. You may identify a superstar employee that is flying below the radar. Is EVERY member of your team answering with a smile and presenting a friendly, welcoming face to your callers? Could you be converting more information calls into sales? The survey and report gives you important guidance. You also may find 2 people on your team answering a simple question differently. You may also identify weaknesses in their training that can be corrected.
The information gathered by Dr. La Mar and her team are presented with detailed charts and graphs which measure performance. Training after the survey is completed, sometimes with Tom, focuses on the weak spots identified by the exercise. Information and results are strictly confidential but the long term effect is significant. For more information contact tom@tommazza.com.
Survey from TMC
Tom Mazza Consulting is preparing new materials and presentations to address the concerns of clients as we all approach what is being reported as "the end of the recession."
We have prepared a short survey for selected clients to get an idea of the changes and approaches that you have adopted in the last 3 years.
We are not collecting any personal and/or business information, just information about changes that have been made in and out of the transportation industry in the last few years.
The survey will take less time to complete than reading this email. Information about how you can get the survey results will follow the brief list of questions.
Please help us to help you - by clicking the following link and giving us 5 minutes of your time.
Web Management: EFX Marketing & Media Design