In 1997 the airlines took away our commissions. The travel agency business managed to create their own demise with their short sighted destructive business decisions. Agency owners got greedy, they wanted more. What they ended up with was an entire industry whipped out.
In one day my travel agencies revenue went down by 70% and it was our fault.
It started a few years earlier when I attended a corporate travel conference in Toronto where I learned the latest strategies to gain new corporate travel accounts. Discounting!
With sharpie in hand the presenter carefully walked us through the math which promoted giving away a huge percentage of our revenue to our corporate accounts. As long as we kept $50.00 a ticket, we somehow would be further ahead on volume from all the new accounts we could get.
Guess what? The airlines soon caught on and figured that we obviously didn’t need that revenue so why give it to us? In November 1997, they capped our commissions at… wait for it… $50.00 per ticket.
You can blame short sighted travel agents for having to pay fees to use their services today.
A few years ago, a major jewelry charm maker decided the best way to grow was to remove their inventory from 620 Canadian independent jewelry stores 7 weeks before Christmas! Guaranteed many of those stores have since closed their doors.
I call that another destructive business decision. Let’s just screw the very small business owners who loyally built our company, investing millions of dollars collectively. Today I saw those same charms in Costco… duh, what are they thinking?
No wonder their shiny mall flagship stores never seem to have any customers in them. I can’t bring myself to wear mine after what they did to the small business owners who built their brand.
Here is where I am going with this. What are you doing to get “more” that potentially could be causing others harm? Your vendors, your customers, your staff, yourself?
Maybe it is still using those single use creamers in your restaurant because they are more convenient. Not so for mother earth!
Maybe it is stuffing cash into your pocket to avoid paying taxes on profit. Guess what, the only person you are hurting is you when you go to try to sell your business and it has no value on paper.
Maybe it’s not giving your staff regular raises, instead waiting for them to come to you cap in hand.
It’s not often I write from such a negative perspective. Today at Costco fueled the fire and I believe by sharing this perspective it can help you.
How do you make business decisions?
Take a step back and look at the whole system and imagine the impact of your decision. Business systems are complex, consider that when you change one thing you change everything.
Make sure it’s a change you are willing to live with.