Rough Waters

Rough waters

TWO TRAVEL COMPANIES ADAPT
IN ONE OF HARDEST-HIT SECTORS

by Margaret Owen Thorpe  

It’s been rough for all kinds of businesses. Still, as one almost-cheerful business owner said, “It could be worse; we could be in the travel industry.”

Christy Sazama, spokesperson for MLT Vacations in Edina, ticks off the blows to that hard-hit sector, beginning with soaring fuel prices even before the attacks on the World Trade Center. 

 “This year,” Sazama notes, “we’ve had the war in Iraq, SARS and the Northeast blackout. We’re still not back to where we were before 9/11, although it’s more the economy than fear now.” 

For leisure travel companies, there’s yet another wrinkle. “We’re seeing a major change in the way travel is distributed. The airlines no longer pay commissions to travel agents, and consumers are using the Net to shop around much more.”

Two Twin Cities custom tour firms, Crossing Borders Inc. in Bloomington and Preferred Adventures Ltd. in St. Paul, have faced it all. They offer solid insights about what business owners can do when faced with upheavals they can’t control and can’t always predict.

“We consciously decided to become leaders — to thrive, not just survive,” says Lori Moline, 42, co-owner of Crossing Borders. When the first ax flew, the loss of airline commissions, many travel agencies reacted angrily and threatened to sue.

Says Karen Johnson, president of Preferred Adventures:  “I decided, forget it. I could see the change was permanent. Let’s move on and focus on other business, I said.”

Crossing Borders specializes in custom international educational and spiritual tours for church groups. Its clients are pastors, theology teachers and other church leaders who see global travel to places of religious significance leading to unique depths of Christian understanding.

Since the Holy Land had long been the prime destination for Christians, the ongoing violence in Israel and the war in Iraq forced dramatic change for Crossing Borders. “Today, however, our relationships with our key clients are stronger than ever because we’ve faced these challenges together,” says co-owner Martha Van Gorder, 50.

Preferred Adventures specializes in custom international tours for groups, families and individuals, “combining natural or cultural adventure with an educational experience of enduring value.” Richard Mahler’s travel guide “Belize: A Natural Destination” describes Johnson, whose company’s frequent destinations are Central and South America, as “one of the first truly ‘green’ travel agents in the United States.”  All participants in Preferred Adventures tours receive a coat-pocket-sized card called “PAL’s Nine Commandments of Ecotourism.”

Johnson goes well beyond respect for nature. Her fourth commandment reads, “Respect the privacy and dignity of others; try to understand how you’d feel if you were in their place.”  

Since the shocks began in world travel, the number of US travel agencies has declined from about 30,000 to less than 20,000.  Preferred Adventures and Crossing Borders, both serving clients nationwide from their Minnesota home, are still here. What lessons do they have for all businesses that are navigating rough waters?

Passion. It’s the first word Johnson, Moline and Van Gorder all say when asked, “How come you’re still going, in spite of it all?”  “A passion for people and places,” Johnson immediately replies.

“Our passion for what we do and belief that what we do makes a difference is the source of strength and drive to confront and manage these challenges to our business” says Van Gorder.  Her co-owner, Moline, agrees, “If it were just about short-term profits, we probably would have decided to close the doors.”

Experience counts

But “passion” doesn’t mean naive enthusiasm, the frequent bugbear of entrepreneurs.  Leaders need to know their industries and their markets thoroughly. 

“Sometimes the learning curve is vertical,” Van Gorder emphasizes.  “If an entrepreneur has to learn the industry as well as run a business, it makes the journey that much more challenging.  We know our industry so well that, when these threats materialize, one after another, we are in a better position to dedicate our full attention to them.”

It’s not just places, names, and facts that matter, all three women emphasize.  They talk about expertise and experience so deep that it’s second nature to them.  “I can visualize and feel an itinerary and know whether it’s going to work, going to provide the clients the experience they want,” says Van Gorder. 

Plan to thrive; don’t just react to survive.  “Our goal,” Moline says, “is to thrive in the long term, not to survive in the short run.  We viewed the recent slowdown in business as an opportunity to set up for the next stage.”  Crossing Borders used the time to develop new marketing in pursuit of new clients and to develop new tour ideas for their repeat clients.  At Preferred Adventures, Johnson anticipated a future by solidifying special connections with suppliers in destination countries and creating educational materials about destinations for clients.

Stay with core markets; don’t panic and chase wild geese.  Crossing Borders and Preferred Adventures both specialize in purpose-driven custom tours for relatively small groups, not inexpensive mass market travel.  They’ve not given in to the error many businesses make in a crisis of pursuing any possible market.  “It’s hard for me at times, to stay focused on our specialties, on what we’re good at,” says Johnson.  “There’s always temptation, as well as curiosity, in other areas.  Still, I’m pretty good about referring people to other companies that can serve their interests better.”

Moline and Van Gorder say they’ve not even been tempted to pursue clients other than church-related groups seeking serious faith-related experiences.   Crossing Borders supports these clients with new destinations, such as Reformation sites in Europe, that are alternatives to the violence-torn Holy Land.

Recognize that the foundation of business is relationships, not products, and don’t neglect them.  “Knowing what you’re going to get, how it will all come together, matters more to people than the specific products,” says Johnson. “A computer can make a hotel reservation, after all. But only a person knows if that’s the best hotel for that client, what the client’s going to get while there.”  Major manufacturers learned this several years ago; it works better to have long-term relationships with consulting suppliers than to bid every year for the lowest price.

Use slow times to nurture connections with both clients and suppliers.  “Most of our new business comes through referrals from existing clients, and it’s the best new business because our clients understand who we are and what we do.  They know whether or not we’re a good match for someone else,” notes Moline.  They take the value of relationships further.  “Often, participants in our tours report that their deepest experiences come from new connections with people in the places to which they’ve traveled.”

Both companies quickly sent newsletters after 9/11 to their clients. Crossing Borders quoted Rev. Gary and Rosanna Wunrow, who had been leading a tour in Norway.   “…two sales girls with tears in their eyes told us about the tragedy in New York City….We were moved to see Norwegian flags at half-mast everywhere….We gained a European perspective…grew more connected than we could have imagined and came to feel closer to our Norwegian hosts.”

Preferred Adventures included messages from suppliers in Costa Rica and Argentina and stories from clients who were traveling on that date. The back page read, “We’re still traveling…Let dreams sail!  Let passion prevail!  Let travel triumph!”

Here’s the good news: Martha Van Gorder, Lori Moline and Karen Johnson all say they’re now feeling a faster tempo.  They’re getting calls from clients they haven’t heard from in a while.  They haven’t been asked lately, “Is it really safe to travel?”