You asked for it and we listened. In this column, we ask operators of all sizes and from all walks of the industry a question about their business and report their answers so you can assess how your own company compares to your peers. If you would like to participate, please email Rob Smentek at email@example.com for next issue’s question.
TOPIC: How do you determine when it’s time to end an affiliate partnership?
A good affiliate is an extension of our company: They represent us to our clients. It is time to cut off ties when the affiliate no longer meets our expectations and standards through poor service in reservation, dispatch, and accounting. We also fire affiliates who solicit from our clients. It is unacceptable for an affiliate to double farm-out work.
To cut off the relationship, I talk to either the owner or general manager to detail their shortcomings and failures. Sometimes the dialogue becomes heated, but it needs to be done. Hopefully, we can come to an understanding and separate on good terms. Remember to make sure you have a backup affiliate to replace a fired affiliate.
Perry Barin, Affiliate Manager
Music Express in Glendale, Calif.
Affiliate relationships may end for multiple reasons, but the most irreconcilable one is breaking our trust through either shady business practices or dispatchers who blatantly lie. The entire affiliate business model is built on trust—we are essentially putting our best customers in quasi-competitors’ vehicles every day and hoping all goes well! As such, keeping and nurturing trust is paramount. Most people take the easy route and cut communication lines altogether, thereby burning bridges along the way. Fortunately, there are plenty of great affiliate managers and owners who know how to handle professional relationships honestly and amicably.
Sami Elotmani, VP of Operations—Director of Global Partnerships
Destination MCO Transportation in Orlando, Fla.
Simply put, it is time to break up with an affiliate when they refuse to follow professional courtesy policies. A major red flag we’ve experienced has been when an affiliate calls the chauffeur while the client is in the vehicle. Serious companies should know that most professional services have software that will send driver status updates via email. All they have to do is open the email to see the status. Not following basic courtesies like this will cause us to divorce them and move on.
Marlo & Mike Denning, Owners
Elegant Limousines in Daytona Beach, Fla.
Terminating an affiliate relationship usually occurs after poor service and/or farming out the affiliate job to another provider. It is never acceptable to farm out an affiliate job unless you have contacted the affiliate beforehand and gotten approval. Service issues cover both the ride experience for the passenger as well as timely confirmations, chauffeur information, status updates, and billing. We look at our affiliates as partners and when these standards are compromised, it is time to find another provider.
Jon Epstein, President
Royal Coachmen Worldwide in Denville, N.J.
Affiliate managers form special friendships built on trust. They generally have each other’s back and will do their best to ensure all goes well with a farm-out. The primary focus of our industry is client satisfaction, and if this cannot be achieved by an affiliate, there is no choice but to move on. Providing great service and upholding high standards is our number-one goal. We have faith in our affiliates that they make every effort and provide the first-class service that is expected. Of course, office staff behavioral issues, chauffeur tardiness, and vehicle breakdowns all happen, but it is how the affiliate reacts and recovers that determines whether you continue to work together. However, when problems happen consistently, it is time find someone else who holds our standards. If we end up losing a big account over poor affiliate service, then of course we will let them know and never use them again.
When an affiliate takes too long to either give us confirmations or invoices and is constantly late, it hurts our company name and makes us look bad, which causes us to lose accounts and money. We will give them a few chances, but it is not worth the time; your client doesn’t want to constantly hear excuses—they are paying for great service and they expect it. Then it is time to give your second and third affiliate in that area your business.
Renee Ferraro, Affiliate Manager
ZBest Worldwide Chauffeured Transportation Services in Baltimore, Md.
Consistent service issues are the first and foremost reason to end a partnership. We document all service-related deviations. Communication is key with the partner at this point and we expect them to be responsive in timely manner. Once the service and communication break down, divorce is inevitable.
Another big issue is when a company will not embrace new technological solutions to improve the customer experience. We have fully embraced the GNET switch, which allows different software systems to communicate with each other.
Mark Kini, President & CEO
Boston Chauffeur in Beverly, Mass.
This is a timely discussion because I just experienced poor service firsthand from an affiliate to whom I wanted to send a lot of my executive clients. I was extremely disappointed from the moment the chauffeur pulled up until the moment he demanded an on-the-spot review in front of my VIP clients. Of course, I said he did well, but I was thoroughly embarrassed—the saddest part is that I never mustered up the courage to let him know how awfully he performed. However, I feel that a professional chauffeur should know better than to fill up his tank during the trip or eat hard-boiled eggs while clients are in the vehicle.
Tiffany Morman, President
MARTI Transportation in East Point, Ga.
I believe it is time to part ways when the communication is failing between partners. We are all in the same industry and understand that issues are going to arise; however, working as a team to communicate these issues as soon as they occur so that we can address them right away, figure out a solution, and take the best care of the passenger is essential. Dishonesty is the number-one reason to end the relationship. The more transparent we are with each other, the stronger we are as a team.
When doing affiliate business I believe that the ROI is having a customer extremely happy with the service they received in the affiliate city. To me, it has nothing to do with how much business is reciprocated from the chosen affiliate; it is about the quality of their work and the experience for my client.
Overall, being honest is the best way to cut ties. No one in this industry wants to fail. However, sometimes things happen and we need to be informed our weaknesses to become stronger partners and hopefully regain the trust and business of partners we may have lost.
Ami Nichelson, Sr. Vice President of Sales & Affiliate Relations
Omni Limousine in Las Vegas, Nev.
For us, it’s time to cut an affiliate if they give us more headaches than relief, whether it’s reservation errors, dispatching, billing, pricing, or just bad performance. These are the obvious signs that maybe it’s time to look for a new affiliate.
If your affiliate is open to advice, listens to your concerns, takes responsibility for their errors, and gives you solutions on how they can improve or how they could do things better in order to avoid incidents, then they may deserve a second chance—but if you already have the feeling that they won’t, then its time to let go. Trust your gut instincts. After all, you are making the right decision for your business, and losing customers is something that no one can afford. It’s important for both parties to communicate when something is wrong in order to fix the error, improve the service, and continue the business relationship.
If you decide not to continue the relationship with your affiliate, don’t share your bad experiences with others. Keep in mind that just because it didn’t work for you doesn’t mean that it won’t work for anybody else.
Ariadna Noches, Affiliate Manager
American Transportation and Limo Service in Miami, Fla.
Affiliates are some of our best clients ... and our worst. We always give a credit card for our farm-out rides and the best affiliates do the same. Chasing money is never fun and consistently pursuing payment from the same affiliates wastes time and cuts down on the profit margin. Affiliates who leave us hanging for long periods are the ones we are most likely to fire.
The best affiliates are those who work with us to resolve any issues that come up. We don’t want to work with an affiliate who takes no responsibility and charges you for an entire charter if, say, a client reports a chauffeur falling asleep and ends the ride. Those are the affiliates that you not only fire but also add to a “deadbeat” list. If an affiliate’s service level does not match or exceed your own then they too should be replaced before your client replaces you. Luckily, we have not had to fire many affiliates—the partners we work with are among the best in the industry.
Hoss Oskouie, Vice President
Atlantic Limousine & Transportation in Atlanta, Ga.
Divorce is never fun for either party. It means that something went horribly wrong, rarely once but likely repeated times, and it didn’t get better. There are circumstances where one time is all you need, and other times when a bunch of little things will make you wonder, “Why am I still here?”
In my opinion, it’s how a problem is dealt with that determines whether we split or stay together. Once, in the pre-GPS days, we had a driver that went northeast instead of west for a pickup. We quickly scrambled and were able to get a partner of ours up in that area to pick up the passenger and bring them to the airport on time. Once everything was in motion, I called our client/affiliate and explained the situation. They were thrilled with the recovery, that the ultimate client never knew, and we were able to keep the relationship. Had we thrown it back on their lap, I’m certain we would’ve lost the account.
There are affiliates who have performed service for us where we felt we needed to cut the ties. When a problem arose and no responsibility was accepted on their end, we knew we couldn’t continue with them. That ends things pretty quickly—and permanently.
Honest mistakes happen, and good people will do whatever they can to make it right. A caring attitude does wonders.
Tracy Salinger, General Manager
Unique Limousine in Harrisburg, Pa.
We expect affiliates to put customer needs ahead of their own. If a client cancels within 23 hours and an affiliate has a cancellation policy of 24 hours and sticks to their policy in charging me, this is an immediate red flag that the affiliate does not value a long-term relationship and focuses more on short-term gains than repeated revenue. Flexibility is always critical to keeping customers on your side.
For us, billing errors are the fastest way to end an affiliate relationship. If an affiliate cannot quote and invoice me exactly the same for a trip that did not change from quoting to completion, I end up protecting the customer and paying the difference: Integrity and accountability are two of our core values.
Also, we are not as concerned when a service incident occurs, but rather the response to the incident will determine if this is a suitable affiliate for my customer base. I had a driver pull out a cellphone and take a picture of my client and plane at an FBO. The response by the affiliate was to immediately apologize, zero bill me, and terminate the relationship with that driver. I knew at that moment that affiliate valued client confidentiality as much as I did and they remained in my network. We are committed to the highest standards of service quality and business integrity, and demand that our affiliates are as well. One policy, one invoicing issue, one service issue will not terminate an affiliate relationship, but the response afterward very well might.
Darren Thiesfeld, Global Strategic Sourcing Manager
Universal Private Transport in Houston, Texas
We’ve loved hearing your answers to our benchmarking questions since debuting this interactive section—but we always welcome suggestions for future topics, too!
Have you wondered how others in the industry have tackled a concern you’re currently facing, handled a delicate issue, implemented a certain policy, or do you simply want to propose a topic for our consideration?
Send an email to firstname.lastname@example.org and you just might see your query answered in a future issue. We look forward to your input!