No one is saying that everything is suddenly all better now, that an economy once flatter than a pancake has suddenly ballooned up like a puffer fish and everyone is now rolling in dough.
But maybe, just maybe, we don’t have to hunker down in a log cabin in Wyoming, living by candlelight and spending 12 hours a day clipping coupons, while awaiting the second coming of the Great Depression. Although it appears sometimes that this is what media and economic pundits would have us believe.
What I believe, at least as it pertains to our own little corner of the business world, is that there are sure-fire signs that the economy is getting its second wind after absorbing a near knockout punch for the past four years or so. No doubt this has been the most trying period for the limousine industry since the towers came down and caused, according to the Travel Industry Association of America, “the most significant economic setback in travel industry history.”
Whether the sun has finally come out for good, or whether we are merely in the eye of this economic hurricane, what we are hearing is more and more operators speaking in optimistic terms. A Florida limousine company recently reported a 63 percent growth for 2010. Another in upstate New York says his business is up from last year. My own business, ETS International, which we launched in 2007 just as the bottom was falling out of the economy, has seen double-digit growth each year over the past 5 years, with sales revenue jumping from US$600,000 the first year to a projected 2011 figure of US$5 million.
Still, we’re all very aware that there are many ground transportation companies not quite ready to break out in a resounding chorus of “Happy days are here again.” But there are definite indicators that business is back, such as:
Limousine companies are hiring more chauffeurs. A “good news-bad news” scenario as good candidates are getting harder and harder to find as businesses start to kick in again and unions resume hiring. As more people start pulling a paycheck again, the labor pool diminishes. The additional good news is that as corporate America begins hiring again, they are also starting to resurrect their business travel needs. In addition, national sales meetings and events are coming back stronger than ever, though the one concession they are making to the economy is the tendency to cut back from the more opulent modes of transportation (i.e., stretch limousines).
More and more banks are lending to limousine companies. When the economy tanked it was easier to find Jimmy Hoffa than find a bank willing to extend credit to a limo company. But now bankers that once hid under their desks when limousine operators came around looking for credit, are now viewing those same people as potential customers as the limousine industry starts to rebound. Banks are less reluctant these days to lend money. A Massachusetts limo company recently received bank financing to update its current inventory with motor-coaches, and another in Washington DC recently received bank approval to enlarge its entire fleet. All good signs.
Disposable income is on the rise. As sales revenue growth rises in 2011, up consistently from 2010, 2009, and 2008, more people are traveling. We are seeing this not only in the surge in business travel, but also in the entertainment dollars being spent. More customers are traveling to and from concerts, nights on the town, and so forth, often utilizing party buses, which more ground transportation companies are now including in their vehicle portfolio.
Customers are being more pro-active. In the downturn, limousine operators had to amp up their marketing in an effort to get the phone to ring, relying on a lot of guerilla marketing and cold sales calls. Now, it seems customers are starting to reach out more, calling around, trying to find the best deal possible. Phones are ringing again.
New vehicle purchase is on the rise. And is it any wonder, since according to a recent survey, nearly 50 percent of the limousine operators polled said they would purchase a new vehicle in the next 12 months, feeling that such a purchase would give them a definite competitive advantage in the marketplace. Nobody wants to be behind the 8-ball when things rebound even more in 2012.
More limousine software to choose from. The number of ground transportation software products also continues to rise, whether it’s Trip Tracker, Odyssey, Limos Anywhere FASTRAK, Corporate CarOnline, or any of the other software products readily available. And it’s a good thing, since the same poll revealed that 55 percent of limousine operators heavily rely on transportation software to be successful. That being said, it’s hard to believe any software company would invest millions of dollars to create software for an industry heading in the wrong direction.
I believe what we are seeing are strong indicators of an industry beginning to rise from the canvas. But it can only happen if we, as business owners, refuse to get discouraged by the daily rhetoric that the economic sky is falling and instead establish an optimistic mindset that will allow us all to play a role in its resurrection. And this can be accomplished by simply attending regional and national association conferences, conventions, and meetings.
But don’t take my word for it. According to Chris Weiss, Editor of Limousine Digest, “Things have really seemed to make a nice turn around for the world of chauffeured transportation and corporate travel. We have consistently heard that business has turned the corner, and that operators around the country have made a significant rebound.”
It’s true; the signs are all there. They may not be crop circles, but they are visible enough to believe we’re definitely heading in the right direction.
John M. Greene is a 25-year veteran of the limousine business, and President & CEO of ETS International in Randolph, Massachusetts, USA. ETS International has an affiliate network of more than 350 limousine companies throughout the United States. The company was recently chosen as “Limousine Operator of the Year.” John Greene can be contacted at 617.472.9900 and [email protected] .