DFK ANZ Article by Robert Shelton
AFTA@Work Newsletter August, 2014
Tourism is a complex industry that involves a broad range of businesses, organisations and government agencies working together at different levels to deliver a complete tourism package. Your agency is the central link to all this for your travelers, but it is still a business.
Take a few minutes to ask yourself these 5 health check questions.
Call it a goal or a mission or a purpose, your business has a reason to exist! And it’s more than just “to make a profit”. Agencies with a clear statement of purpose and goals will outperform. If you have a clear idea of what your business will look like down the track from the very start, you are far more likely to achieve it. At least your journey will have a destination in mind. So, begin with the end in mind…and it’s never too late to begin again!
From the very beginning, It's important to ensure you start your journey in business with the right amount of start-up capital. This is the amount needed to buy the equipment or pay the lease bond, buy the people you need and the advice that helps. Cash flow also covers travelers for whom you may allow credit. Regular sales targets are an indicator of coming cash flows, and enable monitoring of progress.
Surplus cash flow determines how much in borrowings might be needed from your bank. Positive cash flow is the most significant indicator of a healthy business. Don't run your business on a credit card!
What's important in any business is keeping your customers happy, especially when it comes to booking a holiday – you want to deliver the best service and experience possible! In the ever-squeezed travel market, being general might not be enough. Finding a niche space where you can excel and stand out from the crowd – that will be visibly better!
Having a team of committed, engaged and reliable people makes all the difference in business. To build your team, clear goals and purpose, shared values and culture is critical. The “tone” for this is set at the top – what examples and conduct do you set?
For larger agencies with a few team members, there are some simple things you can do to ensure you're operating at your highest capacity. For example, buddy up your new recruits with somebody, giving them a mentor through the first 90 days. Build a career progression chart, showing people where they are going and what they should be learning next. Team engagement and development are far more important than simple salary.
Many agencies are small or solo ventures, so the question is, are systems in place that will allow the business to survive without your being there? An advantage of having such systems is that the resale value of your agency is much better where the systems are all in place to keep going regardless of who is at the helm.
McDonald's "Do you want fries with that?" is a classic (and clichéd!) case of great systems and procedures in a business. Systems make things run better – your team knows what to do and how to do it (even when someone is away); from a customer's point of view, they know they are getting a reliable standard of service; and you know things will be done right even if you are not there. If you have a quiet spell in your business, take the time to develop templates – the minute you're doing something more than twice, develop a template for it.
Article by Robert Shelton, Director at DFK Everalls Canberra
DFK firms provide plain English advice, profit improvement plans, in-depth business coaching, board advice and much more to grow your travel business