For legacy company Exclusive Sedan Service, which marked its 40th anniversary near the beginning of the pandemic in 2020, returning to its roots has been a bridge to help them celebrate year 41 and beyond.
Depending on how you look at it, 2020 was the year to purge from your memory or one that shook you to your core, or possibly a little of both. One thing is for sure, there was no playbook or big-budget Hollywood script that showed us how 2020 would shake out, although it sure would have been beneficial if Doc Brown and Marty McFly had used their time machine to warn us.
with the highest share of infections in the country, a dubious honor it now holds as we begin 2021. Few sectors of the economy have been left unscathed (except if you’re Jeff Bezos or Elon Musk), which includes entertainment—the biggest slice of ESS’ business. Early on in the year, COVID halted television and motion picture productions globally, ironically at a time when so many people were forced to stay home and were glued to their streaming services. This shutdown sidelined the majority of ESS’ revenue for months.
“My worse fear prior to COVID was always what we would do if we lost two or three contracts. But to lose 95 percent of business in the first five months—there wasn’t a plan for that drastic a drop. We dealt with it well, but I think we’ll always have it in the back of our minds how to make the company financially stronger and not overextend ourselves,” says President Brandan Stein, who leads the company with his father and ESS founder Ron Stein.
California, the home of Exclusive Sedan Service (ESS), has been among the hardest hit states Despite the inescapable reality of the pandemic, things have been trending in the positive for ESS since Hollywood studios, deemed essential services, reopened in the summer of 2020. Every market has been recovering at its own pace, sometimes up and down as COVID numbers spike. The Steins note that they aren’t operating anywhere near 2019 levels—who is?—but runs are increasing and vehicles are moving because their business isn’t beholden to corporate travel. Barring any drastic changes to current projections, they think Q2 or Q3 should be the turning point for them.
But things do look different.
Brandan says the initial days of uncertainty were probably the hardest and posed the most challenging questions: Do we sell vehicles? What about the team? Is this going to end in six weeks, six months, or six years? And with so much new and conflicting information swirling around the coronavirus, it wasn’t always possible to make educated guesses.
“We live pretty humbly and not beyond our means, but this was a lesson on how to be even better because anything can happen,” says Brandan. “Once you get in that mode that everything is working and flowing, you tend to forget that it won’t always be like that.”
Ron says Brandan struggled in the months after they laid off members of their team, as he admirably took on roles he hadn’t done in years such as reservations and dispatch, and even considered driving. Meanwhile, he was also handling the changes in his personal life as he had just purchased a new home, and his two young kids were dealing with distance learning as well as the upsets in their own routines and social lives. Working countless hours a day and sacrificing sleep, time with his family and friends, and his fitness routine would not be sustainable in normal times, let alone a pandemic. It was a wake-up call the generally optimistic guy needed to bust through that funk.
“He was putting the business before his health and working 20 hours a day, which had a serious impact. He had to bring back a couple of people to help cover some shifts so that he could be around for his children. It was very unhealthy for him physically, mentally, and spiritually—and he’s only 40 years old, so I don’t know how older operators in our industry were doing it,” says Ron.
“We had to figure out how we could hit our key performance indicators and bring some staff back. The team just came in and said ‘whatever you need, we got this,’” says Brandan. “But I look at it as a positive because it helped to identify the changes I wanted to make. The policies and procedures I had carefully written when we were a huge team had to be handled more efficiently. We have always been a pretty tech-savvy company, but now we better utilize the technology we have to benefit our clients—and it wows them because it makes their lives easier.”
It also helped them reconsider the things they thought they were supposed to have, such as their 10,000-square-foot warehouse, 2,000-square-feet in office space, and multiple locations across the Los Angeles area. More could be done effectively in less space and still allow for future growth, so they scaled way down to 900 square feet and shed the second location, opting instead to match vehicles with chauffeurs when needed.
Maintaining a 50-vehicle fleet was another challenge, especially for Brandan as he pondered whether selling too many would leave the company vulnerable if business picked up quickly. He faced a brutal and saturated resale market, but it also meant that about 35 vehicles were off their books and insurance making the remaining 15 a perfectly fit for their current demand. The vehicles they did keep were retrofitted with partitions, and all courtesy items such as bottled water and magazines were available only upon request as a precaution. Cash flow remained positive by renting some of their minibuses to film productions for defined periods, as well as continuing to secure picture cars that would be used on set—and end up on film. Pretty cool!
The unbreakable COVID safety procedures that studios have imposed—which are incredibly serious judging by the recently leaked video of Tom Cruise berating the crew for not masking up—have actually been an upside for ESS against TNCs. Uber and Lyft recently scored a huge victory in state as voters overwhelmingly voted for Proposition 22, a ballot measure that carves out a special niche for app-based company to use ICs. Its full and lasting impact is still not certain. However, it seems that having a rock-solid, four-decade relationship with the studios and knowing that Ron and Brandan will follow the protocols to the letter is an advantage over sending an unknown Uber driver. That trust led to one more benefit: They were able to raise their rates.
“There’s a lot of pent-up desire to get back out there and see people. Zoom isn’t going to cut it forever.” – Ron Stein Founder of Exclusive Sedan Service“I noticed that a lot of companies lowered their rates, but we did not do that. We pride ourselves on our service and how hard our guys work, so we actually raised our rates—nothing drastic. Clients have been OK with it. Our biggest client is barely operating at 20 percent of their normal volume. They understand that we are doing everything to keep them safe, and I don’t think you can put a price on that,” says Brandan.
A buzzword across the industry has been “consolidation,” which Ron has been researching more and more these days. His goal is to continue to identify smaller companies whose owners have once again become a one-man show in order to consolidate operations with ESS. That way when business does come back, those functions can continue to be handled by ESS and the owner can focus on doing what he or she does best—ultimately a win-win for everyone.
COVID presented new obstacles for Ron as well. Jackie, his lifetime partner in crime and co-founder of ESS, was laid off from her job early in the pandemic, but was luckily one of the few who returned—albeit in a part-time capacity. The upside is she was able to pitch in at ESS wherever necessary on her off days. Fewer working hours also helped the incredibly proud grandparents spend more time with their beloved grandkids, as well as enjoy long weekends at their property in Ventura County, just steps away from the power of the restorative sea. The tightknit father and son also get in plenty of surf time and ride the open road on their hogs. And let’s face it, they’ve been surfing quite a bit more these days.
“Dad and I have always been close, but now we’re having in-depth conversations about the future and quality of life instead of just work. We rediscovered the appreciation we have for each other, and yes, it gave us more time to surf together,’ says Brandan, who has also been making it a priority to spend time with lifelong friends again.
They also learned how to connect with their clients in a new way. The state restrictions on gatherings meant they could no longer meet with their contacts over lunch, or powwow in person. In some cases, longtime relationships came to a professional end as bigwigs who were already considering retirement passed on the torch a little earlier than planned—and introduced ESS to the new guard. Awards shows and movie premieres, among ESS’ bread-and-butter events, were held virtually, postponed, or canceled outright.
“Dad and I rediscovered the appreciation we have for each other, and yes, it gave us more time to surf together.” – Brandan Stein President of Exclusive Sedan ServiceWhen productions did return, it was a whole new ballgame with temperature checks several times a day, COVID testing multiple times weekly, and other protocols that are as stringent—or quite possibly more so—than the state of California’s. By extension, Exclusive Sedan was expected to also follow these guidelines, with no exceptions: For example, chauffeurs needed to quarantine two full days prior to any run, and only after testing came back as negative. And by all accounts, the ironclad (and costly) requirements are working and keeping Tinseltown humming along even as the rest of the state faces the most restrictive lockdown orders in the country.
“Rather than getting in-person time with clients and affiliates, it’s been phone calls. Some people are in their office, but a good number are working from home, too,” says Ron. “There’s a lot of pent-up desire to get back out there and see people. Zoom isn’t going to cut it forever; only so much can be done online before people want to return to normal.”
Industry conversations have changed, too. Without the social events like shows and association meetings to break up the work year, many have turned to Zoom and regular phone calls not only for camaraderie, but for brainstorming and a sense of unity. It helped to boost the spirits of operators who were trapped in those moments of despair, but to celebrate the meaningful victories that were happening all over the industry no matter how small. Even the sunniest of people need a lifeline.
“Things are getting a little busier with the company, but for a long time I was talking with anyone I could,” says Ron. “I’ve been in the industry for 40 years and I was asking for advice as much as I was sharing ideas. We miss seeing our friends so much.”
“Conversations are different than before COVID. It’s now ‘what are we doing together, what’s our plan as an industry.’ We’re all craving that unity,’ says Brandan.
It’s been endlessly inspiring to see how resilient and inventive our industry has been over the past year as operators like the Steins lean in, “right size” their businesses, and figure out their own playbooks along the way. As the saying goes, you never know how strong you are until being strong is your only choice, and these challenging times have certainly forged their spines in titanium. [CD0121]