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Enterprise Aer Travel finds profits and success by focusing on the mid-size market



Aer Travel, Inc.


Founded:

1983


President:

Gil Saidy


Employees:

17


Sales for 2000:

$19.3 million


Projections for 2001:

$23 million


Headquarters:

Sorrento Mesa

In 1992, an airfare war sent prices plummeting, customers phoning and, essentially, overwhelmed airlines’ and travel agents’ booking systems.

It was then that Aer Travel, Inc.’s Gil Saidy clearly recognized what he considers the true nature of his industry: customer service.

The trigger was the airlines’ response to the chaos, he said. When agents couldn’t use their computers to reserve flights, they called the airlines and heard a recorded message. “‘Thank you for your call. All our lines are busy. Please call back later.’ That’s what the airlines did,” Saidy recalled.

Even now, almost a decade later, Saidy still remembers being stunned by the response. “Agencies don’t get away with that,” he said. We don’t get to do that. We have to figure it out.”

The company currently has 17 employees.

Aer Travel’s sales were $19.3 million last year and are on track to total $23 million when its fiscal year ends in September. Ninety percent of its income comes from corporate travel, according to Saidy, Aer’s president and owner.


Supplemental Income

As with almost all travel agencies in recent years, the income structure has changed significantly. Agencies’ service charges now supplement what airlines pay in limited air ticket commissions.

Saidy is upfront about his distaste for the air carriers’ relationship with customers and travel agencies.

“I’m going to try not to take too many shots at the airline industry,” he noted jokingly.

In 1983, Saidy was working for a large travel agency in town when he decided to open his own company and focus on mid-size companies. He’s yet to waver from that goal, he said.

Among the corporate clients is Epicore Software Corp., which is based in Irvine but has offices in San Diego.

Mark Mangianpini, Epicore’s travel manager, manages the company’s $26 million travel budget. Epicore has 1,200 employees, and offices in London, Singapore, Sydney, Hong Kong, and major U.S. cities.

Saidy offers Epicore additional services, such as creating Web pages on the Aer Travel Web site for each of the company’s meetings, Mangianpini said.

The pages detail the locations and travel arrangements for each event. The employees select their preferences and the information is sent to an Aer Travel agent, who replies by e-mail to the customer.

Saidy himself creates the Web site, free of charge, for Epicore within 24 hours.

It’s an example of Aer Travel’s approach to customers, Mangianpini said.

“I would have to wait weeks to get that kind of stuff done if I were working with a mega-agency,” he said. “We’re not that big of an account. We do $750,000 to $1 million a month, and there’s a lot of bigger fish in the sea than us.”

Saidy continues to cultivate his niche.


High-Maintenance Client

Another client is the San Diego Chargers.

“We’re really a high-maintenance organization,” said Annamary Howard, executive assistant to General Manager John Butler.

Howard makes arrangements for Butler and the team’s assistant general manager.

“We probably cancel more than we book. We do a lot of last-minute stuff,” Howard continued. “For instance, we work with two different agents over there and we may call one of them and say, ‘We’ve got a player he’s going to be at the airport in less than an hour and we need to get him on a flight here to San Diego. The players can be from all over the country , and they take care of us.”

It’s not that easy of a task, said Howard. Before the Chargers started using Aer Travel three years ago, they had some negative experiences.

“We had a pretty good travel agency at one time,” Howard recalled. “However, they went through some personnel changes and it just became a nightmare.”

According to Saidy, personnel has been one of his main priorities. He looks for people with at least 12 years’ experience in the industry, and pays his agents more than any other firm in San Diego, he said.

He also created a comfortable work atmosphere, where shorts and golf shirts are common attire.

“I believe that you’ve got to have people who are very relaxed,” Saidy explained, “because this is a very high-stress business.”


Hidden Stress

He laughed good-naturedly when noting that most people assume a travel agency is a leisurely business.

“No, this is not fun stuff,” he said. “These are people who are business travelers who are not having fun traveling. It’s fraught with potential disasters with flight delays and cancellations and overbooked hotels.

“They’re not traveling to sightsee,” Saidy continued. “They’re traveling to take care of business.”

Because of everything that can go wrong, Saidy continually invests in equipment and software that constantly checks fares, seat assignments and other travel arrangements.

He envisions regular customers using the agencies’ Web sites to book simple trips to their markets, he said. From there, travel agents will check the booking and have continued access to change it.

He also sees a future where customers have more detailed, constantly updated reports of their travel patterns that they can pull up off a Web site.


Using Tech Tools

A self-described “computer nerd,” he made sure Aer Travel was among the first agencies in town to have e-mail. They got it in 1995.

He pulled out the first books he bought on the subject, “The Internet Business Companion.” From an area that described e-mail and how it worked, he read aloud. “It allows you to digest your messages and put more thought into your responses ”

He laughed to see the now-familiar idea so many years later, but recalled that he felt e-mail would give Aer Travel a competitive advantage.

Each year, he spends $20,000 to $25,000 on technology updates, noting it’s a necessary investment, he said.

Even recently, his computer consultant, Glen Jaffe, installed a couple of backup systems for both power and DSL server failure.

“Things went so smoothly with Gil’s installation because we took the time to plan it out very carefully and map it out,” Jaffe said.

“Gil recognizes the fact that his business is 100 percent dependent on his technology,” he continued. “When we talk about providing a system with low points of failure, that made him very excited and willing to try and do new things that are somewhat cutting-edge.”

Competition may have inspired Saidy to get e-mail, but it hasn’t pushed him past his original plans. Limited income from commissions has eaten away at travel agencies, leading many to sell and making it possible for stronger agencies to buy them.

Saidy has yet to do either. He’s hesitant to buy other companies’ negative baggage, he said.

“We’ve just kind of stuck by our philosophy and grown very slowly,” he said. “This may change in five years or two years, but right now our game plan is to just grow the way we’ve been growing, and it works.”

That growth will continue to be fueled by technology, he said.

Saidy grinned when mentioning comments he hears about the Internet wiping out travel agencies.

From the start, he considered it an equalizer. “The Internet was not for the big boys, the Internet was really for the little guys, the way I saw it,” he said. “It put everyone on the same playing field.”

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