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What Determines The Cost Of Quality Limousine Service?

by Daniel Shlifer on Apr 24, 2015 9:30:00 AM

Working Hard-2LIMOUSINE SERVICE - HERE IS WHAT YOU PAY FOR:

What Drives the Cost of Limo Service? Part 1 of an Inside Interview with a Limo Service President.

Have you ever thought about what determines the cost of executive car service these days? What’s it like to run one of these companies? We sat down with Gregg Fox, President and Chief Operating Officer of Corporate Sedan Services, to ask him these and other questions. Fox started his company in 1998 with a single town car and a cell phone. Today, he has 40 vehicles in his fleet, and he employs 45 people.

First, lets be clear about what limo service actually is. The term limo service can mean different things to different people. For the purposes of this article, limo service refers to executive car or sedan service from point A to point B. In this article, we are not talking about a stretch limousine, we are describing the use of a standard sedan like a Cadillac or Lincoln with rear seat room for two typically used for airport, hotel or event transportation.

Before we get into the interview, here are some other helpful pages that should make your research more productive:



STRAIGHT FROM THE HORSES MOUTH:

A rare insight into the business mind of the man that created a growing and successful ground transportation company in Philadelphia, serving not only the local area but 450 different airports nationwide:

1. What is your primary source of business?

We cater primarily to the transportation needs of the business executive. Thirty of our 40 vehicles are sedans – the rest are SUVs and vans, plus a couple of limos.

2. What are some of the factors that determine the cost of car service?

It’s a combination of things, really. The biggest factors are certainly time and mileage. How long will it take us to get a client to a certain destination? How many miles will that journey take? Our rates are largely based on the answers to those questions. Many of our customers are surprised when they see rates to locations other than an airport.

3. Does the price of fuel have much to do with the cost of car service?

Not to any great extent, because we strive to keep that item under control. For fuel costs, we have a set number – we don’t “float” it. As a matter of fact, that hasn’t been much of an issue at all in recent months, with global fuel prices being so stable and competitively priced.

4.  What other things can affect the cost of car service?

Well, there’s also the gratuity for the chauffeur – it’s important to factor that into our rates. And there’s also the cost of insurance for the fleet.

5.  Are there any other special considerations you address when you’re setting your rates?

The cost of car service is very much a market-aligned rate for us. In other words, we certainly don’t want to price ourselves out of the market, but we also don’t want to undervalue the services we provide to our customers.

6.  So many consumers and businesses these days are watching their bottom line. What are you doing to address your customers’ concerns about the cost of car service?

We’re very excited about our brand-new loyalty reward program, which we rolled out this spring. In creating this program, it was personally important to me that we offer rewards to everyone who uses our services – not just to VIPs. A reward program does several things: it thanks customers for their business, it lets them earn points that can be redeemed for vehicle upgrades or discounted blocks of time, and it keeps customers coming back to us. It’s also a great way to add a personal touch to the services we provide.

7.  Is this kind of program standard in your industry?

Definitely not – we were the first to introduce a loyalty program. The really exciting thing is that it’s based on usage and referrals. So our customers can accumulate points whether they are riding with us personally or referring us to brand-new customers. We want to make it easy for people to choose our services and tell their colleagues about us. And we want to thank them for doing both.

8.  What else does Corporate Sedan Services do to differentiate itself from competitors?

We are all quality companies using similar technology and similar vehicles. Where we can differentiate ourselves from our competitors is in the experience we offer our clients. Our loyalty program is one example of how we can enhance that experience. Another thing that sets us apart is that there are no phone trees here – and there never will be, no matter how much we grow. When you call Corporate Sedan Services, we will pick up on the first or second ring and you’ll always speak with a live person immediately. We’re also going to be introducing a coffee club for early-morning riders: our chauffeurs will arrive with coffee when they pick up our clients or build a coffee stop into the early-morning runs. The cost of car service should not be the only reason why customers choose us – it’s also about the experience and the ease of use.

9.  It sounds like you enjoy what you’re doing.

I certainly do – I still have clients today who were with me back in 1998 when I was driving that very first town car myself! People recognize that there’s no substitute for personal service.



Expressions-1THE TRICKLE DOWN EFFECT:

If you read most or all of this interview, you can clearly take away one important lesson. Stand out, personal service that has a direct affect on the customer's experience can make all the difference in the world. Armed with similar technology, equipment and resources, Corporate Sedan Service has been able to separate themselves by providing a different experience. As a business owner, Mr. Fox decided that this experience will be personal service that reflects consistency, reliability and no excuses. This strategy has effectively trickled down to every person under the Corporate Sedan Service umbrella.

Think about your business or career... What differentiates you from your competition?



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This post was written by Daniel Shlifer