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When the going gets tough…

By David Hubbard

A down economy presents challenges of every sort. One of the subtler is to nail down the one maxim that keeps everything in perspective. Over the last couple of months I have talked and listened to motorcoach operators and industry leaders who only reconfirmed my belief that when the going gets tough, the tough go shopping.

I recently met several business owners who, while not throwing caution to the wind, are not holding back critical acquisitions and investments; countering the recessionary fallout with a well-executed proactive response.

Scott Riccio, owner of Northeast Trailways, Lewiston, ME, just closed his deal for a nearby motorcoach company that elected to shut down after five years. “We are as worried about the economy as anyone, and we deal with it everyday,” says Riccio. “But Northeast Trailways is a growing company and we could clearly see how far this step would take us forward.”

Weighing the progress in 2008 against his prospects for 2009, Riccio was not discouraged.

Even with new customers in another region, Riccio says the downward shift in the economy has required the company to implement programs to operate more efficiently, bring pricing closer in line with declining ridership, for tours particularly, and continue to promote motorcoach travel to the public as a cost-effective solution to travel.

“We have taken the appropriate cost-cutting measures in light of the economy,” says Riccio. “Even at that, it is smart to analyze what we do effectively and determine what and where we can improve.”

In Portland, OR, entrepreneurs Joe and Roxanne Gillis suddenly find themselves in the bus business. In a shift from their respective family jewelry businesses, taking the lead of Joe’s sister, Gladys Gillis, chief executive officer, Starline Luxury Coaches, Seattle, WA, the couple looked into buying the southern operation of N.A. Charters, a significant carrier in the Northwest that was shutting down.

This was last August. By October the rumblings of a collapsing economy had not deterred them, but the mission did change. Rather than buy into the older operation, Joe and Roxanne determined it made more sense to start fresh with a new company of their own.

They took delivery of their first motorcoach in January, a 2002 Gladys Gillis in good condition and are about to acquire their second, as Northeast Navigation embarks on its first charter this month.

“Any hesitation comes from fear,” says Roxanne. “Fear comes from a lack of knowledge.”

She says once they made the decision to establish Northeast Navigation they set out to explore their new world, talking at length with other operators, attending UMA Expo, reading all the industry publications and listening intently to advice of every sort.

“Once we felt we had our arms around this industry, we started mapping out a pretty intense business plan,” says Roxanne. “As we developed the plan and our safety and maintenance program came together, our fears lessened.”

The two say they are proceeding on their belief that this recession is not going to last forever; believing the mentality of crawling under a rock and waiting it out never works.

“My thought is if we stop pushing now, where will we be when the sun does come out?” says Roxanne. “Crawl under a rock and the business would be crushed.”

Meanwhile in Abbington, PA, the Zamboni Transit Authority has been up and running since December. As the owner of several ice rinks in the area, Mike Madera created this licensed charter company to fill what he saw as a unique transportation niche to help his customers get to hockey clinics and tournaments in the Northeast. His Zambonis are actually three older-model MCIs that smooth the rigors of travel for youth hockey groups, teams and elementary through college leagues.

“Our motorcoach services are simply for hockey — young players, coaches and parents,” says Madera. “We are looking to acquire more buses, but we have no plan to compete with other companies, we only want to pay attention to our own narrow niche.”

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Posted by on Mar 1 2009. Filed under Finance, Motorcoach. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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