What do you do when you sign a lease for a beautiful new brick and mortar office—and before you even open the doors, the coronavirus strikes? If you’re Lorraine Simpson, a luxury travel advisor based in Ontario, you keep your wits about you and carry on.
“You just have to reinvent yourself sometimes—and I’m the queen of reinvention,” Simpson says, noting that she first started her agency in her basement after 9-11 and the death of her husband.
Indeed, Simpson hopes she got a new customer late last night, when she received an emergency phone call from a traveler who had booked online and now was stuck in Morocco. Even though he was not a client of hers, she spent hours getting him out. “Right now it’s not about who you booked with, it’s everyone helping each other. Just get on with it and the karma will come back to us,” she says.
Simpson likely will need some positive karma in the next few weeks. She signed a lease on her “beautiful store on a main street of my little town” just three months ago; brought in shelving she bought at a great price from Pier One, which was going out of business; and had a friend decorate the walls—inside and out into the street—with vintage suitcases, to catch the eye of cars going by.
She covered the walls with photos of her own travels, set on canvas by her son, that she hoped to sell. She set up one side of the agency as a travel retail store to sell “clothing and belts and RFID-blocking purses” to draw in passersby. She made a deal with other travel advisors to work in the office for commission only.
“I’m gung-ho and I’m going to just step right up and do this,” she said on Tuesday. “Of course I’m scared—but I’ve never done anything not scared. I started my travel business in my basement when my husband died. You’re often more successful when you do things scared.”
In light of the coronavirus, the mortgage company has given her a month’s break and the government is working on tax breaks, too, “so I think it will be fine,” she said.
As she sits alone in the beautiful office, she’s thinking of taking Mastermind courses online, and collaborating with other advisors to get through the day. Hanging out on Facebook the other day while on hold for three hours with Air Canada, she came upon a post from another travel advisor who’d been on hold for six hours with Travel Brands, another supplier she needed to reach. They swapped information on the reservations each needed to cancel, and when each one got through on their respective call, they handled the issues for the other’s clients as well as their own.
In renegotiating with suppliers, meanwhile, Simpson noted another new twist. She is trying to move “a massive corporate incentive group for a large cosmetics company, with lots and lots of moving parts” scheduled for July. Even as she spoke with the hotel to try to get a new date, she realized she also had to renegotiate the terms of the contract to include a clause allowing her to cancel two weeks out.
“I probably spent eight hours on that yesterday for free,” she says, while the $60,000 in commission from that group, which she expected to help with her rent, hangs in the air.
“So now it will be even harder” to get her new office going, but she is determined to open as scheduled on April 2. “Even if in the first few weeks all I do is reassure people, I’m building up future business. And what else are we doing? I’ve literally canceled every single booking for this year except for this group.”
One Opens, Others Close
In Wilmington, MA, meanwhile, Bruce Mandel closed his brick-and-mortar office on Monday, “hopefully for a couple of weeks,” while he, his full-time employee and his eight independent contractors took their work home.
Beyond the cancellations he has another worry: that the consumer-friendly policies of suppliers are actually offering customers better deals than the travel insurance he usually sells.
One family traveling on an $8,000 trip booked through Apple Vacations, for example, is being charged just a $250 cancellation fee—much less than it would have cost them to buy the travel insurance he had suggested to them, they noted. “So they are actually making out better than if they had bought the Apple Vacations insurance, and that’s not a good thing,” Mandel said. “At least when they take the insurance we still make $100 a booking; now these people are getting more money and we get zero.”
He figures he’s probably lost about $12,000 so far in commissions “and that will be a lot more in the coming weeks. But we have plenty of money, we haven’t overspent. I’m ready to roll when this is all over.”
Mandel, too, has reinvented his business before. He bought a corporate travel agency and opened with four reservation agents in April 2001. In his first month the biggest corporate account went through a merger and moved its business elsewhere; on September 11, travel ground to a halt. He totally changed his business model, went from 1 percent leisure business to about 50 percent, and survived.
Michelle Malliet, meanwhile, just closed the doors of her agency for the first time in seven years, after she and her two independent contractors sat alone in the office for the better part of last week.
In a Wisconsin town of 7,000, “it’s kind of depressing sitting there for eight hours doing cancellations with no one coming in,”—and even when one customer did, considering a trip to Hawaii in May, Malliet declined to book it right now. “It doesn’t make sense to do all that work not knowing what the airlines are going to do,” she said.
One client called her last week to say her companion wanted to cancel but she still wanted to go, and Malliet agreed to accompany her instead. But by Monday Malliet was having second thoughts, and recommended not traveling at all at this time.
With the office closed, she’ll be listening to webinars, re-certifying for Disney and other suppliers, and doing extra training with her independent contractor.
“Last week everybody was calling me to cancel, now I’m reaching out to people who are scheduled to say, ‘I hate to do this, it’s your call, but do you think you should be going at this time?’ I need to know that my clients are okay; I want to take care of them. This is going to show a lot of people why they should use a travel agency.”
For now, the rent is not a big problem. She just got paid for two destination weddings so she has a bit of a nest egg, and she will try to negotiate the rent rather than take one of the small-business loans that are being offered. “I don’t want to have to dig out when things turn around,” she said.
Her IC, meanwhile, took a summer job.
“We’re all going to be ready to travel when this is over. If we can all hold on until then,” she says.
And after 32 years in a brick-and-mortar office in Saskatchewan, Canada, Sandy Farber says she, too, has always been frugal and so believes her agency will be okay. It is closing for the first time “as a precaution for me and my agents; we need to be well and available for our clients, and we can’t do that if we are sick,” she said.
Rather than being too quiet last week, her office had an influx of people she had never seen before, “all these online bookers who had no resources. We became a drop-in center, which was a concern. So we decided our clients know how to get ahold of us and most don’t even want to see us, and we closed.”
For now only employees and independent contractors are welcome, but she is still going in every day. There are a lot of resources there, including multiple phone lines that allow her to hold for five suppliers at the same time.
Of course she will reopen, she says. “We’re coming into this in the best shape ever so I’m not worried. If I don’t bring in another dollar for the rest of the year I’ll be fine.”
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