Onto the next venture

As you can see it's been a while since I posted to this Blog. The main reason is that in October 2008 I sold my stake in SpeedBreaks. Trading conditions at the time were extremely difficult. We'd had to deal with the collapse of the pound against the Euro and a severe recession.

As if the direct effect of reduced bookings and increased cancellations wasn't bad enough we also had to deal with the collapse of Excel airlines in Autumn 2008. We had quite a number of flights booked with Excel at the time. For a small business already having a tough time it almost felt like the last straw as we then had to rebook all the flights at inflated prices with another operator. And ATOL of course provides no protection for small travel firms caught in this dilemna.

Then just a couple of weeks ago I heard that SpeedBreaks (since renamed Adventura.com) had gone into administration. The recession, the low margins, the weak pound finally did for it. It's a real shame as I still think it's a great concept and with a little more luck it would have succeeded.

My new, much delayed project is www.westcountrylets.co.uk. The new website has been built in Joomla with a special extension called Joomres to handle the booking side of things. The site has been expertly designed by Andreas Pohancenik at PRACTICE + THEORY. Joomla is of course PHP but all the customisation and bespoke build has been done by the excellent Hazel Wilson at www.highlandvision.com

Gearing up for the Ski Season

We're now putting the finishing touches to our ski schedule for 2008/2009. As ever there are a few imponderables to consider:
1. Will it be a good season for snow?
2. If it is a good season when will it be a good season? 2007/2008 was good because there was early snow which gets people thinking about skiing. What you really don't want is an Indian summer stretching well into October
3. What will happen to the euro sterling exchange rate?
4. What will happen to oil prices?
5. And last but not least what will happen to the economy? Only today we had a call from a customer who wanted to cancel a holiday she'd recently booked because she'd been made redundant. Is she just the first?
Elsewhere I've read on www.travelmole.com/ that some of the big operators are still quite upbeat. Because if people love skiing they'll want to go even if the price goes up by 10-15 percent. However what we find is a lot of our customers come away with us on their second or third ski holiday of the season. Maybe it's that second or third trip that will get cancelled if money gets a bit tight.

Big Changes afoot at SpeedDater

Since I last posted we've sold our dating business to Easydate to concentrate on Singles Travel. This is good because it allows us to focus but also scary because the steady income of our dating business has been replaced by the more cyclical income from our travel business.
We had a very successful singles ski holiday season overall but learned a few tough lessons along the way. We had too much capacity in January which proved expensive. We were also badly hit by the loss in value of the pound against the Euro. The pound fell a whopping 16 percent in about six months which, unsurprisingly has had a very negative effect on our margins.

Travel - Owning the Value Chain

Owning the value chain is a piece of business jargon. In the context of SpeedBreaks I guess it means owning more of what we do. The very first couple of ski holidays we ran, for example, we used the products of other tour operators. Organising holidays ourselves has increased the risk for us and created more work but has also improved our margins and given us more control over the product we sell.
The next step, and an idea I've been grappling with, is whether we should get into the business of owning property - specifically a hotel or a ski chalet probably in the French Alps. Funnily enough we had the same idea with our original speed dating business, speeddater.co.uk After speaking to lots of people about the idea the consensus was that setting up and running a bar in London was completely different from our speed dating business and therefore it was not a good idea to get involved. With our travel business on the other hand I think there's a much stronger case for owning more of the value chain.
On the plus side we now have enough volume in the business to be able to fill our first property pretty much to capacity (14 or 15 weeks in the winter and about the same in the summer. Also on the plus side I think the right property could be a very good medium term investment and running our own hotel or chalet ought to improve our margins and give us even more control over our product (minibuses with SpeedBreaks emblazoned on the side spring to mind)
Unfortunately the potential difficulties are considerable. First of all we'd need to raise the money and we're talking at least a million euros to buy anything worthwhile probably closer to two million (are any friendly Angel's reading this?). Perhaps a bigger worry is whether the business of running a small hotel or chalet would take our focus away from our core business (producing and marketing holidays for single people and single travellers).
I've just been through the experience of buying and renovating a house in France so I've no illusions about how difficult it can be to find good builders who turn up when they say they're going to in France. If a chalet 'renovation project' slipped by three months, say, it could be financially disastrous if we'd already sold holidays into a property we thought was going to be ready for Christmas 2008!
What does anyone reading this blog think we should do? I'd love to know.

Technology - don't DIY

We have a completely bespoke online booking system. When we started building it five years ago it was probably the right thing to do as we couldn't find anything off-the-shelf that would handle booking speed dating tickets.
However when we moved from speed dating to tour operating we were forced to add new features to our system. It all works but not as well as it should. For example our content management system is a bit of a nightmare to use. Posting a new event is time consuming and it's easy to make a mistake or leave a field unfilled.
Since then the off-the-shelf product landscape has changed immensely. I recently attended an internet dating conference and saw a product demoed by a company called Pringo Networks. It basically allows you to buy a Social Network off the shelf. In fact Pringo Networks even built a clone of Facebook in 6 hours, called Lacebook to demonstrate the products capability. Now I reckon that using conventional methods it would take you at least a year and cost hundreds of thousands of pounds to clone Facebook.
Looking back over the last five years we definitely made several mistakes on when to DIY. For example we decided to build our own chat client for our online dating site. It took us months, cost us quite a lot of money and in the end didn't work as well as the widely used (in the dating industry) chat client from Userplane.
From now on I'm definitely aiming to beg, borrow or license off-the-shelf products as much as possible.

The stuff I wish I'd known when we started

Well lists are a favourite journalists (and bloggers) trick so here' s my first. Eight things I wish I'd known when I started this business.
1. How to buy currency (see earlier blog)
2. How incredibly labour intensive this business is.
3. How difficult cash-flow is (if you have to pay deposits months before you get paid)
4. How singles travel is even more labour intensive than most travel businesses because you have so many separate bookings. Oh for a big corporate group booking (better margins & one big payment)
5. How much work we'd need to do to adapt our ticketing system from selling speed dating tickets to travel (rooming, taking deposits etc)
6. How heart breaking it can be when despite your best efforts something goes wrong and not everybody has the brilliant time you hoped they would have.
7. How it's almost impossible to please all the people all the time.
8. How brilliant some suppliers are (and how complacent & useless others are)

Currency conversion!

When we first started SpeedBreaks we bought currency (mainly euros) from our bank Lloyds. This was not only an expensive way to do it, as I later discovered, but also involved the most ridiculous paperwork imaginable. You had to fill in a long printed form, enter a unique code and then fax it to the bank. The bank would then key in the form, often incorporating unwanted mistakes along the way (such as the wrong receiving bank account number). After a year or so the bank brought in a new system which was even more complicated and involved sending us a little black box that generated a unique code...

Well I never did get to grips with it because fortunately I ran into Rueschlink at a trade show. Ruesch not only offer far better rates, they also have a complete online system which is very straightforward to use and generates reports. Ruesch also offer telephone support from a real person who answers the phone and even calls up periodically to see how things are going. They've saved us thousands of pounds and lots of grief.