The Year Ahead

While everyone is hoping the global financial crisis is behind us, TravelManagers' Board took time before the end of 2009 to reflect on how the past 18 months impacted on the company's business and what it means for 2010. Chairman Barry Mayo shares their thoughts with us.

A new year brings a fresh start and perspective, new energy and enthusiasm. While Australia has been in comparison to other countries, relatively unscathed by the impact of the financial downturn, it would be ignorant and foolhardy not to take time to reflect on its influence on the business.

When the world reacts to events around them it is easy to pull back, lose sight of your business plan and hunker down. TravelManagers certainly took steps to increase the risk focus across all areas of our business. We sharpened our focus on costs but importantly we saw strengthening and growing the business as a priority, ensuring we did not lose focus on operational delivery.

During challenging times it is more important than ever to continue to deliver exceptional operational performance. Your biggest advocate is your client base and consistently delivering outstanding service definitely pays off through referrals and repeat bookings. With new marketing initiatives our personal travel managers had valid reasons for making contact with their client base. The high uptake of these offers or using the opportunity of contact to quote on another trip reinforced the importance of maintaining contact with their clients.

We sustained our expenditure on marketing and our investment in technology, taking advantage of the market downturn to seize opportunities and increase our market share while continuing to prepare for the future.

The global financial crisis highlighted basic fundamentals that are essential to building a business, beginning with the experience and talent of the management team. Having people you trust, with differing experience and skills but a common vision for the business is essential to not only survive in tough economic times but to continue to prosper. ?It also reminded us of the importance of having a strong balance sheet. We constantly monitored this throughout 2009 keeping an even closer eye on our day-to-day cash flow. Importantly, the internal controls and governance we already had in place proved their worth and served us well.

The crisis reinforced the importance of having a solid reputation. One of the first things to receive a hit in a crisis is confidence. Again established ideals served us well with our values based around trust and integrity. It is something we expect across the business, at all levels. Our values are non-negotiable and consequently they're creating a very solid reputation of trust both internally and externally.

The next 12 months brings a single minded focus on following our strategy of continuing to improve our financial performance for all stakeholders through accelerating our growth. The professionalism and quality of our management team, support staff and the high calibre of our personal travel managers, will ensure we achieve this.

While consumer confidence continues to grow steadily, it is unknown whether the current gradual recovery is sustainable or whether there is the possibility of a second dip in economic activity. The impact on consumer demand as the Government's 2009 stimulus package winds down with no repeat stimulus is unclear. We are alert to this possibility and conscious to the fact that unemployment and rising interest rates can quickly erode consumer confidence.

The planned approach is to continue working hard to ensure our personal travel managers have good quality product and packages to market to their clients, product training that not only keeps them up to date with what is in the market but is relevant for the type of product their clients favour and thirdly, continuing the development of new technology that will continue to improve the consulting experience for our personal travel managers' clients while ensuring efficiency and productivity standards are maintained.

Importantly TravelManagers is very confident of our future. We are excited about the continued growth opportunities in the next 12 months, building on our strong 2009 financial results that saw the company grow each quarter. Growth figures throughout 2009 have been significant, increasing every quarter. This we see as a strong recovery of consumer confidence and the impact of implementing TravelManagers marketing strategy. Most pleasing and defying the broadly reported industry downturn over the last 12 months was that for the six months to December 2009, TravelManagers growth was up 49 percent. With the highest commission structure in the personal travel manager sector, this meant our personal travel managers also strengthened their businesses bottom line e.g. 2009 yield improved 19.7 percent when compared to 2008 while the average margin (i.e. gross commission) for our top 100 PTMs was $50,854 with our top 25 PTMs averaging $107,265.????????

?While no one can predict the future, there is no doubt the best approach is with a solid plan and an expert team to support and lead with open communication.

Barry Mayo is the Chairman for House of Travel Australia.