COSTA MESA, Calif. — Motorcoaches are a segment of the luxury ground transportation industry that are becoming more popular every day. Some think they’re a saving grace from the likes of Uber and Lyft, but that can be a dangerous train of thought if they aren’t prepared for what comes with adding motorcoaches to your fleet (insurance, maintenance, payments…the list goes on). Matthew Strack, CEO of Strack Ground Transportation, has some advice for operators who are toying with the idea, and explains the importance of having the right staff to make it profitable.
Motorcoach Do’s And Don’ts
Getting into the motorcoach business has been a slow road for Strack. He felt it best to start small with vans, Sprinter vans, and mini coaches. Later, he moved the mini coach up to a 29-passenger, then a 39-passenger vehicle. Finally, he purchased a 56-passenger motorcoach. The company applied for a DOT number several years ago which allows interstate travel state, as well as DOT oversight and potential audits down the road.
This means following federal regulations and keeping an eye on hours worked, vehicle inspections, and driver logs. “That for us was the introduction to what it takes to be a CDL driver,” Strack says. “We’ve been taking baby steps, and now we find ourselves here. I personally think that’s where we can differentiate ourselves from other bus company competitors.”
He warns others it’s not something you can decide overnight; he considered it for over a year and a half before he decided to make the jump. “If you think you’re ready, go back and double check your plan,” he recommends.
The biggest questions to ask yourself are: How are you going to procure the business needed to help you see an ROI? What are you going to do in terms of maintenance? Do you have the right kind of drivers, and how are you going to continue their training?
The first thing he did before getting into the bus business was talk to his existing clientele. Many received the idea very well, and the company also started marketing the vehicle type online using social media.
“Another big piece of the business is talking to a lot of the other bus operators around the country. At certain times of the year, you can’t find a bus at all. So if you’re tied into these larger operators, like an affiliate network, you can get business out of them that way,” he says.
Strack Ground decided to purchase the company’s first motorcoach new because of the cost of maintenance and lack of an in-house mechanic; it helps to have a warranty on a brand new vehicle. “We’re close to a service facility, and we’ve got a good relationship with them,” he explains.
Your People Make Your Business
Strack says many of the company’s successes are made possible by its staff. “Some operations just put bodies in the car. That’s a problem because we try very hard to weed out and hire the right people that enjoy what they do, know how to deliver service, and deliver it well,” he says.
To thrive in this industry, you have to have a high service level. Otherwise, what sets you apart from an app-based company like Uber or Lyft? “You can’t provide that with people that are just driving cars around because they’re going to act as though they were a taxi driver. Concierges on wheels are what we tell our chauffeurs they need to be.”
High service levels are frequently brought up when operators are questioned about what makes them unique, but can they actually maintain them as they scale? Or do they eventually get to a point where they start throwing people in the car just to drive it?
“We’ve had a slow, organic growth, but we try to focus on maintaining that high level of service. Whether it’s the iPads we have our chauffeurs use for airport greets, the pocket square they’re required to wear in their suit jacket, or the company mandated tie, we feel all these things make the difference in our product,” he says.
Getting good chauffeurs to stay is another challenge faced by many companies. Strack believes an important part of retention is making your staff feel they are important. One way the company rewards them is by ensuring they get to drive a variety of vehicles—they recently participated in an event with Maserati where chauffeurs got to experience two new cars for the week.
“Our chauffeurs can’t stop talking about driving the Maserati Levante or Quattraporte for high profile clients in Beverly Hills, and have been thanking us for the opportunity,” Strack says. “It’s a great reward for a couple of employees that have been an integral part of the team.” Strack Ground also has a Mercedes S550 with a rear seat chauffeur plus package for its discerning clientele. The chauffeur team is equally excited about delivering top notch service in this vehicle as well.
The company has quarterly meetings, get-togethers, and contests. Strack tries to create an exciting workplace for them and make it fun. “We think we’ve done a really good job because all our chauffeurs have a great comradery with their fellow coworkers,” he says.
Strack is trying to push his chauffeurs to understand the need for a CDL driver’s license because he feels that’s where the business is going. To sweeten the deal, he’s incentivizing them any way he can, whether it’s trips to Las Vegas to pick up a new motorcoach, better work, or a higher priority of being dispatched to work.
In addition, he also sponsors chauffeurs to test for School Pupil Activity Bus (SPAB) certification. “It costs a couple thousand dollars to get them all up to speed, but that’s something we want to support,” he says. Obviously, he wants an agreement they’re going to stay with the company for a decent amount of time, but wants to ensure they don’t have to pay out of their own pocket to benefit the company.
Unconventional Beginnings
Strack was originally planning on starting another company in the housing market. He had savings, and was looking for supplemental income to help get the business off the ground. After considering a few different jobs he could do that would provide him with work on nights and weekends, the first thing that came to mind was bartending or food service. Instead, he saw an ad to be a chauffeur. He checked it out and ended up working for the small company.
He got to know the owner and clientele, and enjoyed the work. About eight months into working there, the owner and his wife decided to get a divorce. The owner wanted out of the business, and ended up asking Strack if he was interested in buying the company. At first, he declined, but the owner continued to ask him about it. He made a low bid, and the owner passed the company on to him.
Strack bought a 2007 GMC Yukon as his first fleet vehicle. Not really knowing anything about the industry other than how to be a chauffeur, he purchased a vehicle he wanted to drive. “I didn’t want to drive an XL; I wanted to drive a small one. And I wanted to tow my boat. I figured I could do a few rides a month, buy a brand-new SUV, have it completely paid for by the chauffeur business, and be able to tow my boat with it. So that’s what I did,” he says.
Learn From Mistakes
Strack has found success in doing a variety of different things. “It’s rare you ever have a home run type of deal. It’s a lot of small wins from all over the place. I feel I can be successful by looking at just a multitude of different opportunities out there for procuring business,” he says.
The company doesn’t have a solid niche; it all comes down to the service they provide no matter the vehicle or clientele type. “My focus is on what we can do to wow the client, whether it’s from somebody answering the phones 24 hours a day, how we respond on the phones, or what kind of training we give our chauffeurs to give them the wow factor in the car and keep them coming back,” he explains.
That’s not to say everything works 100% of the time, however. He experimented by adding a Tesla and Prius to his fleet in an attempt to go the green route a few years ago. “Some moves get you exposure. Some are a flop. You just learn from your mistakes and continue trucking along.”
Taking risks is the only way to see what works and what doesn’t. Some may say a smaller-sized company getting into the bus business is precarious, but Strack is confident he can make it work. “If I know a payment’s coming up and I need to get out every day and make it move…I’m committed to my business and will do whatever it takes.”
He also has a CDL license just in case the need arises for him to jump in and help out. Running the business means nothing is above him, no matter how exhausting it can be at times.
Keywords
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