It wasn't really a surprise that Cristina Buaas and Dasha Westerfield knew each other. Each woman owned a travel agency in Houston: CSB Travel in Buaas' case, West University Travel in Westerfield's. Their agencies were only 2 miles apart. They were both Virtuoso members. Their clients moved in similar circles.
But what was surprising was their decision earlier this year to merge their agencies to create River Oaks Travel, which they co-own.
"I think we wanted to really stress the local connection in our community and be a really strong presence for the local market," Buaas said.
A merger between two agencies is "very uncommon," said Robert Joselyn, president and CEO of the Joselyn Consulting Group. "Rarely do we see it."
As Joselyn said, the word "merger" is used a lot, but usually it means one agency is buying another.
That's not the case with River Oaks, though. It's a true merger, and both Buaas and Westerfield carry the title "co-owner."
As with any merger, they will see a number of benefits, but what strikes me as particularly smart in the case of River Oaks Travel is the amount of future-proofing the partners managed to complete with one transaction, even if that wasn't their primary objective.
Before they merged, West University Travel was a storefront agency and CSB Travel was based out of Buaas' home. Both had employees and independent contractors (ICs), but each agency had just one owner.
What would happen if that owner was unreachable on a trip, got sick and needed to take time off or was kept away from the business for some other reason? Who would make decisions about the business? Who would assist the owner's personal clients?
Certainly, to some extent, problems could be anticipated or dealt with by the owner from afar. But there is a certain security in having another reliable head of the agency, one who will make sound decisions in the business' best interests in case one owner is absent.
It's "the power of two brains," said Westerfield.
As the IC model proliferates and more and more travel advisors essentially own their own business, this is a problem that is bound to come up more frequently. Buaas and Westerfield have found a solution that not only solves it but also gives them the benefits of size, scale and synergies.
It's not the solution for everyone. Joselyn likened the merger to a business marriage, and like an actual marriage, both parties need to ensure they are compatible on many levels before finalizing the choice. That includes financial compatibility from a business model perspective, culturally and based on clientele. If not, he cautioned, "divorces are painful."
Robert Sweeney, president and CEO of Innovative Travel Acquisitions, agreed.
"The odds going into that that it's going to work out beautifully, it's not 100% sure," Sweeney said.
He urged any agency owners considering going down a similar path to have their agencies appraised by an expert so they can execute an equitable merger.
Buaas and Westerfield went into their merger with eyes wide open. Both participated in Virtuoso's benchmarking program, developed with Joselyn, so they were already used to sharing details about their businesses. That helped them confirm their compatibility.
Westerfield said, "We were able to look at our businesses in terms of finances and how it's structured from the get-go and know where we both stand."