ALEXANDRIA, Va. -- The fledging United Motorcoach Association 20 Group program is delivering as promised.

Bus company owners -- with both large and small operations -- say the program is doing just what it said it would do when it was started last year - help them better understand their businesses and bolster their bottom lines.

"Every time I come back from a 20 Group meeting, I make changes based on something I picked up at the meeting," said Gladys Gills, whose Seattle-based Starline Transportation has become a major industry player in the Northwest.

Jim Cantrell, who operates the much smaller Daniels Charters in Gainsville, Ga., said the sessions have been a "real eye opener" for him and have helped him identify important areas of his business that were being overlooked and neglected.

Developed by business consultant Duane Spader of Spader Business Management in Sioux Falls, S.D., the program involves noncompeting operators getting together in small groups several times a year to review each others financial reports, develop benchmarks for performance and discuss ways each of them can improve. Each group has a maximum of 20 members, thus the 20 Group name.

Since it was announced in late 2005 and the first meetings involving UMA members early last year, the program has grown into five separate groups and expanded to include carriers from Trailways Transportation System, the Ontario Motor Coach Association and Gray Line.

A sixth group 20 Group Lite recently was formed using a new concept that allows members to meet by telephone or video conferencing rather than in person. The new group allows smaller companies to take part without the expense of travel to meeting sites for the regular three-day sessions.

"The UMA groups are doing extremely well, especially for a new industry, and were tremendously pleased having so many groups" noted Spader, adding that it usually takes several years for a new industry to reach five or six groups.

Operators involved in the program say they, too, have been pleased with how well the programs have been going and how valuable the benchmarking and exchange of critical information have been to them.

"Whenever I receive our monthly reports, I pour over them looking for anything that can help my business," said Dave Bolin of New World Tours, an East Coast operator based in Barstow, Va.

He said hes been surprised at how much more he has learned about his own business since joining the initial 20 Group early last year. "Sometimes I feel like the biggest idiot in the group," he confessed.

Among the key lessons he has learned was that his financial ratios were off from those of most other companies, a discovery that has led him to increase prices and reduce expenses so they are closer to the industry norm.

Eye openers

In addition, he discovered he was not doing a good enough job at marketing his business and his long-time policy of turning over his coaches every three years might not be best for his company because it inflates his fixed rate.

"If the market doesnt support changing out the fleet as often as we have been doing, then well have to start keeping our coaches a little longer," he said, stressing that hell be reviewing the situation regularly rather than simply buy new coaches according to the calendar.

Bolin said that while the meetings confirmed he is a decent salesman, they also revealed he lacked important marketing skills. "I found out I was very good at sales, but not good at all at marketing, advertising and just promoting my business," he said. "While were working at it now, were still not sure what were doing in the marketing area so it will take time for our company to improve."

A surprise to him, he said, was discovering that the most successful companies in his group were not just excellent at several key categories of their businesses, but they were outstanding at all of them. "In my case, we were overdeveloped in some areas and underdeveloped in others, so in three to five years I have to discipline myself and my employees so the company gets better," he said.

For Gills, who co-chaired UMAs initial 20 Group and now chairs a second group, the learning came quickly and the subject involved one that keeps a lot of motorcoach operators up at night price increases.

"Early on we realized that raising our rates even at the risk of losing some customers actually worked," she said. "I found out we could make just as much revenue operating fewer buses, and with a shortage of drivers and mechanics, that makes a lot of sense."

She said her fears of increased prices were alleviated in part by realizing that bus brokers charge about $1,000 more than most carriers, convincing her there really are plenty of customers out there who are willing to pay higher prices.

Smarter decisions

"But it is a real gamble if you dont know how it impacts your bottom line," she cautioned, noting that the 20 Group program gives operators the opportunity to study before they act.

Gills said the meetings also have made it possible for operators to scrutinize their operations by providing them with benchmarks and other valuable tools. "People get so caught up in working their businesses they dont have any real scrutiny and they go for years without any," she explained. "You cant really scrutinize your business if you dont have any measures."

Cantrell said his 20 Group experiences have helped him get better control of his business by clearly demonstrating that his product was under priced and the importance of offering outstanding customer service.

"I found just how under priced we really were," he said. "We were at 1 to 3 percent margin and that was not good enough, so we instantly increased our prices."

He said a review of how other carriers operated emphasized the importance of customer service and led to his creating a special point system that pays his drivers a cash bonus for the number of compliments and driver requests they get from customers each month. "We turned all of our drivers into sales people," he added.

Cantrell said he also thought his utilization was good, but after analyzing all of the numbers worked up at the meetings he realized there was considerable room for improvement.

"We thought we were at 60 or 65 percent, but found out we actually were around 50 percent," he said. "If all of our buses are on the road one day, we think were doing good, but then we forget about the two days earlier in the week when they were sitting on the lot. Thats what happens if you dont track their use."

UMA members interested in joining the 20 Group program should call Spader sales executive Jim Treinen at (800) 772-3377.