Good Business Models To Learn From
Economically slow times will often see a drop in people needing travel related services. Car rental companies, upon seeing the turn in the economy made some very smart financial decisions. This good quick sound financial decisions put these companies in a very solid position and emerge as leaders in the travel industry. Their proactive steps allowed to them to safely maneuver through and around the decline that soon followed, giving them a safe position ahead of the curve. This is an excellent of good business sense and planning for any business to examine and learn from.
Selling down, or downsizing their overall rental fleets was a good decision. This allowed them to keep the best and most preferred vehicle choices, while taking advantage of the leverage this created with the renting public. Two very important things emerged from this strategy: more capital to stay competitive and offer good customer service as well as being able to charge more per vehicle per rental. This gave a healthy boost to the business while other businesses were struggling to stay afloat.
Secondly, they also opted to close rental locations that were not producing much in the way of profits again, creating a leaner market and increasing demand. This adds up to a higher demand on vehicles and drives the price of a rental up. The more demand there is in the industry the better able they are to maintain a competitive price per rental. And this good business sense has potentially saved the entire industry.
Finally, the decisions to reduce the overhead associated with their rental vehicles resulted in a windfall of savings. This allowed them to hang on to their older but just as reliable rentals for longer time frames. Overhead expenses that were generally used to replace vehicles approaching the 30,000 mile mark, could be used to keep the vehicles is tip top shape for less than the expense of replacing it. Today’s vehicles are not even getting started at such low mileage indicators.
The results of these good sound forward thinking decisions are something to learn from. While those businesses that are riding out the uncertain waves of bad decisions are desperately slashing prices to stay afloat or have already sunk. These wise business decision makers would be excellent choices for national leadership. Unless the current leaders suddenly took an interest in some very creative ways to put the nation’s financial interests back on track before it derails with total disaster.
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