For Home-Based Biz Agent, Fees + Service = Success

Travel agent Michael Schrobat swims against the tide.

His agency, Cetc Travel Services in Portland, Ore., started charging service fees even though people warned him that he would lose clients. And, while many corporate agencies are expanding their leisure business, he has beefed up his corporate business.

In the 10 years since Schrobat, a former tour company employee, launched his agency with a leisure client base, it has evolved to cater primarily to corporate clients.

Currently, 96% of the business at Cetc (Cetc stands for Corporate Engagement Travel Company) is corporate travel.

“The future will be corporate for me,” said Schrobat, whose agency is a member of NEST and the Affluent Traveler Collection.

Constant revenue stream
Schrobat said he attributes his success in part to the fact that he charges fees, which corporate clients are willing to pay. “I discovered there’s a constant revenue stream by charging fees for corporate travel.”

While he declined to divulge Cetc’s revenue figures, he said fees account for 36% of the agency’s gross volume. “We charge for everything,” he said. “I don’t work for anybody for free anymore.”

Schrobat, who works from home and has an outside office, makes paying those fees worthwhile for his clients, most of which are law and consulting firms, by providing personalized service and being on call 24/7.

While he acknowledged that some companies have chosen not to do business with Cetc because of its fees, others see the value.

One client left 18 months ago, turning its travel-planning duties over to the firm’s in-house administrative staff. Eight months later, the client was back, because it couldn’t match Cetc’s level of service.

Cetc offers its clients a long list of additional services, including meeting and conference planning, incentive travel, private air and ground transportation arrangements, obtaining visas for international travel, restaurant reservations, and arranging for personal VIP gifts.

High expectations
Schrobat doesn’t do it all himself – he has six independent contractors – but he does handle the agency’s seven largest corporate clients.

“They’re demanding, and their expectations are high,” he said of his clients. “But they pay you for that service.”

On average, he has 20 to 28 people traveling each week. “I plan as far out as I can and as cautiously as I can,” he said. “Unless it’s nor’easter like we’ve had, I rarely hear from my clients. Or, if they just want to change a flight, that’s easy. But they need to know they can call me.”

For that purpose, he has a dedicated cellphone whose number he only gives to clients.

Saves money for clients
Another way he earns his clients’ business is by saving them money through negotiated corporate hotel rates. He shows them how much they are saving and then charges a fee for each night that they stay at those rates.

“Some clients have actually asked me to raise our fees because we were able to show them significant savings,” he said.

Schrobat takes part in his clients’ corporate travel policy decisions and uses their feedback to negotiate with preferred suppliers. But he doesn’t always book those suppliers.

“I will not book our contract property if our rates aren’t available and I can get acceptable rates at the competition,” he said.

Trusted by his clients
Schrobat said he has learned that relationships and trust are everything in his business. “Once you develop a relationship with a client, they expect you to make a decision; they don’t want to have to ask,” he said.

For example, when severe weather grounded planes in Washington, D.C., this winter, a client who was due in San Francisco the next day for another meeting let Schrobat know there was a problem. Schrobat booked the client on several flights to San Francisco, so he had options in case some were cancelled.

He also called the traveler’s assistant to have her reschedule the San Francisco meeting.

Asked about competing with large TMCs, Schrobat acknowledged that large corporate agencies “are powerful and big.” But “we grew through referrals from one company to another,” he added.

“We don’t market and we don’t advertise. My clients know they will get their needs met. Building those relationships is more important than having a big name.”