TRAVEL

Now owned by top executives, Cruise Planners on course toward continued growth

 

Cruise Planners — American Express Travel

• Leadership: Owned by CEO Michelle Fee, CFO Tom Kruszewski and COO Vicky Garcia

• Headquarters: Coral Springs

• Employees: 50

• Franchise owners: More than 850 franchisees are actively selling travel. The number of franchise owners has grown by 14 percent a year for the past few years.

• Start-up costs: Free for experienced cruise sellers; $3,200 for those who have worked in travel; $9,995 for someone with no travel background.

• Continuing fees: Company gets 3 percent of all commissionable sales.

• Vacations sold: 96,000 cruises, land-based vacations and other travel-related services in 2012, up 14 percent from the previous year.

• Revenues: In 2012, agents sold $156 million in travel and travel-related services.

• Growth: Revenues increased 16 percent between 2011 and 2012; from 2009 until 2012, that growth was 48 percent.


hsampson@MiamiHerald.com

With a background in travel and present-day focus on raising her two small children, Lori Jahner set out to find work she enjoyed that would give her the flexibility she needed.

The 33-year-old from Aurora, Colo. decided on Cruise Planners — American Express Travel, a home-based travel agent network headquartered in Coral Springs.

“They have so much training to offer, ongoing education, and the branded name alone is so reputable and distinctive,” Jahner said. “Out of all the ones that I kind of looked into, this is the one that was standing out. More or less, it’s just the perfect opportunity so that I can do what I love, which is raising my kids but also selling travel.”

She has plenty of company. More than 850 franchise owners around the country are actively selling travel through Cruise Planners after paying startup costs that range from zero to $9,995. Those costs cover initial and continued training, marketing and advertising programs, a website, accounting and customer management software and support from the home office.

Fueled by everyone from stay-at-home moms to firefighters and retirees, the number of franchisees has grown by 14 percent annually for the last few years.

That has not gone unnoticed by cruise lines, who welcome more voices pitching their product.

“I think they are very important,” said Camille Olivere, Norwegian Cruise Line’s senior vice president of sales in North America. “They’re big supporters of ours and they’re bringing new people into the industry — and that is something that we desperately need.”

Cruise Planners agents sold $156 million in travel and related services last year, a 16 percent increase over 2011 and 48 percent jump over 2009.

Confident in continued growth, top Cruise Planners executives bought the company late last year from Palm Beach Capital, the private equity firm that had been majority owner since 2007.

CEO Michelle Fee, who has always held a stake in the company and now owns 50 percent, said she and fellow owners chief financial officer Tom Kruszewski and chief operating officer Vicky Garcia did not want to risk Cruise Planners being taken over by another investment group that might try to make changes.

“We wanted to make sure that whatever we keep doing is in the best interest of the company,” said Kruszewski, 60.

Before, Fee said, agents often asked whether the investment company would try to sell or change Cruise Planners. She said the purchase sends a good message.

“It shows them that we’re in this with you,” said Fee, 50, who co-founded the company with two partners 19 years ago. Those partners retired in 2007.

The company has invested about $2 million in technology upgrades and equipment in the last few years, including a mobile reservations system for agents that was introduced about a year and a half ago, and a consumer mobile app for iPhones and Androids that should launch later this month.

“We just have to be cutting edge,” Fee said. “Travel is technology; we have to be there with the big guys. Not only are we matching them, but we want to be better.”

Janet Fernandez, who started her Crise Planners franchise, Cruise Impressions, last July after working in different parts of the cruise industry since 1998, said she is already taking advantage of the latest tech innovations.

“I have an iPhone, I have an iPad,” said Fernandez, 32. “It’s crazy, the apps they have created. I can work from anywhere. They’ve made it so easy.”

That’s a huge leap from the company’s early days, when one agent remembers the only computers were devoted to booking airline tickets.

The company got its start in 1994 when Fee and competing travel agents Marvin Davis and Lynn Korn joined forces on cruise sales.

Mike Gelman, a franchise owner in Flowery Branch, Ga. was the first agent to work with the newly formed company back in 1994.

“When we started, it’s like comparing the Wright Brothers at Kitty Hawk to traveling to Mars now,” he said. “That’s what the difference is.”

While the technology has changed, he said, one thing has not: “What they told me originally when I joined, ‘Mike, we want to run this like a family company. We are all family, and that’s how we’re going to treat everybody. And if you’re successful, we’re successful,’” he recalled. “That’s the way they run the company.”

The company’s first cruise-sales training class had just five people in it; by the end of the year, there were 45. Cruise Planners began selling franchises in 1998.

The affiliation with American Express Travel came in 2004, a perk that franchise owners say lends their businesses instant credibility. Cruise Planners buys a franchise from the travel giant, which gives the company the ability to take advantage of deals American Express Travel has negotiated and to allow customers to pay with credit card points.

This year, Cruise Planners - American Express Travel rose 10 spots to be ranked No. 34 in Entrepreneur Magazine’s list of top 500 franchises. Its closest competitor, Fort Lauderdale-based CruiseOne, was No. 55 on the list.

The company has a good reputation with cruise lines as well, earning partner or franchise of the year awards from some of the world’s top brands.

Late last week, Royal Caribbean International surprised the company with news that it was the winner of the top honor of the 2012 President’s Award for Overall Achievement after being named home-based partner of the year for five years.

“These are very bright, smart businesspeople that are running Cruise Planners,” said Vicki Freed, senior vice president of sales, trade support and service for Royal Caribbean International.

New franchise owner L.J. Boothe, 29, said the company’s reputation was one reason he chose Cruise Planners in realizing a longtime goal to go into business for himself — even though he’s never been on a multi-day cruise.

“They’re consistently ranked the top in the industry,” said Boothe, an Army veteran who served in Iraq and Afghanistan.

An accountant with an MBA and father of two from Bristol, Tenn., Boothe said he plans to keep his day job at a federal accounting software company while he gets the cruise business up and running.

He was one of more than 100 agents, mostly new franchisees, attending a recent training session at the Broward County Convention Center. Jahner was there too, and confessed to some “information overload” late in the week.

“What I’ve tried to focus on is just picking a couple of cruise lines that I want to learn really well and the things I know in my demographic that are going to sell really well,” she said.

That’s exactly what the company needs in order to keep making money: agents who sell well. Travel agents typically earn 10 percent commissions from cruise lines, and while the company said it could not reveal specific rates, Fee said commissions are higher for Cruise Planners agents because of the volume of business the company does.

In turn, the company earns royalties of 3 percent of agents’ commissionable sales.

“We don’t succeed until they sell travel,” said Garcia, 46. She highlighted the support they offer to agents to make sure they can do just that: a magazine printed with agents’ names and contact information, the Facebook page for agents that launched last year, the QR codes and deals negotiated for franchise owners.

“We do these tools and do this support to make sure they’re selling,” she said.

In addition to cruises, the company is marketing land and tour sales more heavily. Those segments of travel make up 14 percent of the company’s total business, and that number has been growing. Sales increased 33 percent from 2010 to 2011 and 107 percent from 2011 to 2012.

“It doesn’t mean our cruise segment is shrinking, it just means the pie is getting bigger,” Fee said. “We need to be a 100 percent well-rounded travel company.”

After weathering the recession and the jolt the industry felt after the deadly Costa Concordia shipwreck in Italy last year — more pronounced in Europe than in North America, where Cruise Planners agents sell — Fee said the company is starting the new year with encouraging growth in sales. For the first 25 days of the year, which is the start of the typically busy “wave” season, the CFO said sales increased by 39 percent for cruises departing in 2013 and by 43 percent for all cruises booked so far.

Said Fee: “We’re just feeling that 2013 — knock on wood, no worldly disasters — that 2013 is going to be off the charts for us.”

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