There are advantages and disadvantages to being married to your business partner. The advantage is that we can “talk business” whenever we want – at the office, at home, on vacation, it doesn’t matter when. The disadvantage is that we can “talk business” at any time. Our business never leaves us; it’s with us everywhere we go.
The past few years, we have had a lot to talk over – 9/11, the Iraq and Afghanistans wars and now all of the unrest in the Middle East, earthquakes, volcanoes, tsunamis, the stock market, home foreclosures, gas prices. You name it, it has all affected the travel industry.
Last week when I got home, I turned on the national news and POW!!! Right on the chin!!! The stock market had taken another big hit, which, in turn, meant our retirement account had been hit also.
Then, it hit me. Our business is on a rollercoaster right now. We’re up one day and down the following. There is no way to project anything any longer. Where we were accustomed to doing three-to-five year plans, we can hardly plan further than six months in advance. The 1970 song from the Five Man Electrical Band suddenly hit me and kept going through my head.
Sign, Sign, Everywhere a Sign.
Blocking out the scenery, breaking my mind
Do this, don’t do that, can’t you read the sign?
Maybe we need to be more conscientious of the signs of the times around us right now. Maybe we need to be reading these signs. My next few columns are going to be about the signs that we, as travel agents, need to be looking for and reading.
These past few years, since 9/11, have been a wake-up call for travel agencies to change the way we do business. We are in no less control of our agencies today than we were ten years ago. It just feels like we are. We moving on a very rough road and it’s going to get riskier than it is today unless we plan for the changes that are occurring around us every day.
There is a major economic crisis in our country, and it has gone global. Here are some facts:
- We are still at war with Iraq and Afghanistan, and now in a conflict with Libya.
- These wars are not going to end soon.
- The foreclosures in the housing industry have affected business for all of us.
- The economic bail-outs of big financial institutions had a negative impact on the travel and hospitality industries.
- International travel was been affected more than domestic travel.
- Fly-in destinations are more affected than drive-to destinations.
- Business travel and conventions were hammered in the short term, but are now showing signs of recovery.
- Vacations were booked closer in, were shorter in length and people were spending less than previous years. Again, we are now seeing signs of recovery
- In short, the travel industry slowed down as the economy did.
- The first item a family will take out of a budget in recessionary times is a vacation; it is also the first item to go back in as the economy recovers.
Americans thrive on disasters. Remember how our country pulled together after 9/11. We are a country of positive thinkers with a can-do attitude that has overcome natural, political and economic mishaps in the past. We will do it again.
The symbol above is for “Signal Ahead” There are a number of signals that we should all be looking at in the future.
Here are some signals affecting travel agency sales:
- Unrealistic expectations from customers and suppliers.
- We need to know which suppliers we can trust
- We must realize that customers are constantly checking the Internet for price reductions and be prepared to make these adjustments even if it means reduced commissions for us to keep the customers from going direct to the suppliers.
- Suppliers are now making goals unrealistic to reach when they, in part, are taking business from us by direct bookings.
- Customer fears
- Mortgage crisis
- College and Retirement fund losses
- Financial institution melt-downs
- Security issues
- Health issues
- Need to advertise
- We need to advertise more during an economic turn-down when pricing is at its lowest.
- Our suppliers have cut our co-op funds and small agencies, especially home-based agencies, just don’t have the money to advertise on your own.
- Competing with Internet deals at supplier websites.
- Competing with very large Internet agencies.
Here are some problems affecting home-based travel agency operations:
- Cash flow
- The overall economy
- What will happen if the economy does not turn around in the next few months/years?
The signs are everywhere. We just have to be alert and read them. My next column will discuss more signs of our times.