The cessation of normal business forced by the ongoing coronavirus crisis is not a time to kick back in your PJs and relax. It is an opportunity to regroup, refocus on priorities and rebuild for a stronger tomorrow. Travel advisors should use this time and use it well.
That was a key message from a panel of luxury travel advisors and luxury hoteliers during a 60-minute webinar this week titled Navigating Through a World of Uncertainty.
“This is not a snow day. It’s a priceless opportunity for us to get stronger, to prove our value, to build those dreams we’ve always wanted to build,” said Jack Ezon, founder and managing partner of the luxury travel agency Embark Beyond.
Neither Ezon nor his fellow panelists sugarcoated the grim business realities of the crisis, acknowledging that sales are all but nonexistent and cash flow a huge worry. “It’s probably one of most difficult times in my career,” Ezon said.
Hotelier Nikheel Advani said he was expecting the best, while preparing for the worst. “We’re planning for if we had no revenue until the end of the year,” said Advani, COO and principal of Grace Bay Resorts in Turks & Caicos, which on March 23 closed its doors indefinitely.
The webinar, which was attended by more than 450 advisors, suppliers and travelers, was organized by travel advisors Rob Karp, founder and CEO of MilesAhead, and Tony Abrams, chairman and founder of Four Hundred, a membership lifestyle management firm. Their goal was to serve as a resource. “The only way we’ll get through this is if we do it together,” Karp said.
The dual challenges of managing cash flows and providing for employees were top of mind for suppliers and agency owners alike.
As an owner, you have to find ways both to take care of your employees and keep your business afloat, Karp said. “This is a time of creativity and almost entrepreneurial thinking about how to solve problems that seem unsolvable.”
At Embark Beyond, Ezon said he had spent hours researching the best solution for his team members. “It’s not only about using the money you have now to pay your people, but how do you keep the doors ready to be opened so that everyone has a job to come back to. Our responsibility is to give them longevity, not just a Band-Aid for the next couple weeks or months.”
After considering paying staff reduced wages, Ezon rejected the option, since doing so would disqualify staff members for unemployment benefits. Now he’s looking at paying workers as outside contractors on a project basis during this period. “We want to keep them engaged while they’re home.”
Grace Bay Resorts will do whatever it takes to protect its employees, Advani said. “We’re not getting any revenues, but it’s important to keep this team together. We have to pay staff at some level, keep everybody sustained, because when this comes back, it’s going to be strong.” To help employees and their families, the resort is purchasing staples like rice and milk in bulk and distributing them to employees.
Jannes Soerensen, general manager of The Beaumont in London, urged his colleagues to be open with employees, even when they don’t have all the answers. “It’s absolutely critical to keep your team engaged and consider the mid- and long-term impact before making any decisions. Stay connected to all stakeholders and keep the teams informed.”
Karp, whose travel agency is hosted by Valerie Wilson Travel, noted the importance of host agencies being transparent with their independent contractors so they too know their options.
Figuring out refunds together
Refunds for customers who have cancelled their travels is another huge challenge. “Everyone wants their refund, and that’s totally understandable, but we also need to work together,” Karp said.
Abrams said he had collaborated with some suppliers to come up with solutions that satisfied clients. “You have to address these things case by case. The best results have been when we’ve been able to get on the phone with each other, lay out the situation and come up with a reasonable solution.”
Ezon too has had most success when suppliers worked with him on solutions. “It’s not about the contracts and the words anymore. It’s about the goodwill and the connection in the long term to our mutual customers and finding a holistic solution that can address the customers, us and our suppliers.”
On the question of refunds, travel advisors should advocate both for their clients and for their supplier partners, Ezon said. “I tell clients who are demanding their money back, ‘Listen, there’s a cash flow issue. Hotels are giving back hundreds of thousands if not millions of dollars. We need them to stay alive, because when you want to come back and enjoy what they offer, you want them to be alive.’”
Preparing for a comeback
The travel industry will rebound, panelists agreed, but no one was willing to predict when or what a recovery will look like. “My crystal ball broke in the last month,” Ezon said.
Whenever travel resumes, advisors need to prepare themselves for a changed environment. “The value of the dollar is going to look drastically different than it did earlier this year. We’ve seen a great deal of people lose their jobs, or they’ve seen a big portion of their net worth disintegrate. We need to stay focused, but we need to stay sensitive as advisors,” Abrams said.
Advisors should connect with clients in more personal ways, taking care to be relevant and attuned to the current situation, panelists said. Embark Beyond is weighing ideas like sending out recipes from around the world and ideas for movies to watch at home that will remind clients of travel destinations.
This is not the time for advisors or suppliers to be encouraging consumers to travel, panelists agreed. But at some point clients will be ready to start dreaming about future travels, and advisors need to think about how they will fuel those dreams appropriately when that time comes.
When clients do start planning trips again, “flexibility is going to be really important for them, and for us embracing that flexibility is going to be really important,” Ezon said.
Use this time well
In the meantime, industry members should take advantage of down time to envision what they want their businesses to look like when the crisis is past and to take actions like assessing their strengths and weaknesses, setting and working toward goals, and learning new skills.
“This is best business school you can go to,” Advani said. “As much as these situations are damaging and difficult, there’s so much to learn. How do we look at cash flow management as a business? How do we take care of people? How do we realign our priorities?”
Karp agreed that there is a business opportunity in the current situation. At the same time, he said, it’s important to “have compassion during this time and understand that we want to push ourselves personally and professionally, we may want to push everyone around us, but we also want to think with our hearts.”
We need to take care of ourselves personally and support one another, Karp said. Also, “be a little kinder than maybe you were yesterday.”