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Finding opportunity in tough economy


Many operators have built businesses on the theory of doing one thing and doing it well. And for many, it works. Yet in today's challenging economic climate, specialization may have a few drawbacks. Diversification, on the other hand, can give operators new revenue streams, along with the peace of mind that comes from having one's eggs in a few baskets. For those operators just beginning to consider diversifying their business plans, we offer a few ideas.

Leave no stone unturned

If you're not pursuing, or at least considering, a full array of tours, charters, school contracts, corporate shuttles, airport work, government contacts, you're potentially missing out on a lot of business. Starline Luxury Coaches, Seattle, has a page on its website that lists just about every type of service it provides, including those that might spark ideas among individual clients — for instance, family reunion transportation, tailgate parties and wine-tasting outings. The company also sends out regular but judiciously timed e-blasts and "coach tips" that highlight ways that customers can use their services.

"We thought it would drive more wedding-type stuff and personal, not corporate, events, but it turns out it's working well with our large corporate clients, too," says Gladys Gillis, who co-owns Starline with Becky Pritchett. They say they can actually see upticks in business when they do those sorts of promotions. But even when it doesn't work that fast, it's worth it. "Even if it takes a year or so, you have to plant seeds to get a tree that will produce," says Pritchett.

Think outside the bus

When Larry and Lorna Hundt, owners of Great Canadian Holidays and Coaches, Kitchener, Ontario, decided the company needed a new facility, they ended up buying a much larger commercial facility than they originally planned on — and then they started renting space out to other businesses.

In short order, the building became the home of a truck repair facility, a long-range truck parking facility, and a card-fueling business, among other things. The Hundts even rented out advertising space on their building. In short, the Hundts went from successful tour and charter operators to full-fledged business entrepreneurs.

Starline, too, uses its facility in ways that complement its core business but stand apart from it: It does pre-delivery inspections for a transit manufacturer. "In business, you have fixed expenses, variable expenses, personnel and revenue," says Gillis. "You have to pay attention to all of those elements. The inspections help us create a new revenue stream."

Make stops

The availability of 5311(f) funds last year got a lot of operators thinking about the viability of new fixed routes in underserved, mostly rural areas. And the prominence of services like Bolt Bus and Megabus.com have gotten more operators thinking about adding line-haul services as well. When done well, it can offer a steady revenue stream with great stability and predictability. But an ill-considered route can be a drain of equipment, fuel and time. Operators like Richfield Lines and Burlington Trailways, Iowa, have been combining line-haul and charter work for years.

Don't let youth pass you by

For years, experts have been telling operators that Baby Boomers are the next big market, but the real opportunity may really be with their children and grandchildren. So it's not entirely surprising that Starline Luxury Coaches has found some ways to make inroads with today's young, tech-savvy crowds — after all, the company is headquartered in one of America's most progressive cities, and Silicon Valley isn't far away. One of its most effective tools has been one of its simplest — the availability of live online chat, accessible from its website and its Facebook page. Gilles and Pritchett say their success with customers who take advantage of the service is exceptionally high. "We have an 80% to 90% close rate," says Pritchett. "You're solving a problem for that demographic. There's a generation that wants to dispense with some of the niceties of communication and get right to the meat. By the time they get to live chat, they're looking to get something done. They don't want a sales person getting pushy with them."

Starline also promotes its Facebook presence by encouraging drivers to take pictures of their groups; they then hand out Facebook-logo cards and tell passengers they may see themselves on Starline's Facebook page if they should visit. It's been working: Starline has some 2,800 fans.

Starline is also careful to make sure it has equipment to suit every group — and young people are especially responsive to the company's MCI luxury coaches with Wi-Fi and other tech amenities.

Don't be afraid to say "no"

When Starline was asked to slash its prices for paratransit services it had provided for years, it walked away. It turned out to be a fortuitous business decision. It enabled the company to use its specialized equipment at the Olympics and ParaOlympics, which ended up being a highly profitable contract.

The company hasn't been casual about taking "no" as an answer either. In an ongoing dispute as to whether it should be able to provide transportation for events such as professional team sports without having to compete with local transit agencies, Starline has gotten involved. Gillis was even involved in creating federal charter rules. Says Gillis, "It takes time, energy and money to be on boards. It's not a terrific return on investment, but giving back is good for all of us."

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