GLENSIDE, Pa. -- The best preparation for running a tour
operator's business, according to Dani Pipano, president of Gate 1
International Travel Service here, is to start at the grass roots.
In the case of touring, grass roots means knowing the destinations
and understanding the clientele.
For Pipano, who took Gate 1 from a two-man business in 1981 to
the $20 million operation it is today, leading guided tours through
Israel for 14 years provided an invaluable insight into the U.S.
clientele he led.
"I would say the groups I led in Israel were 99% American,"
Pipano said. "Having that background in the travel industry has
been a real distinct advantage for me because I understand the
needs of American tourists, and they have always been our main
source of revenue."
For instance, Pipano understands that American tourists want to
be a little more independent. "They don't want us to decide what or
where they are going to eat every night of the tour. They like to
make those types of decisions themselves," he said. "I've found a
lot of Americans really want to go in-depth into one country."
In addition, Pipano said, middle class clientele often want
first class accommodations. "A lot of these people have saved their
entire life to go on these tours, so they spend the extra money for
comfort," he said.
"Also, for an additional couple hundred dollars, they love to be
able to walk downtown from their hotel. That's important, and
they've showed that they are willing to pay for it. That's why most
of our hotels are located downtown."
It's that type of knowledge that has helped revenue grow
significantly, with sales up more than 13% in 1997. Gate 1, which
has close to 100 employees, underwent a major expansion in 1991. At
that time, Gate 1 was about half the size it is today and focused
on its Israel tours.
Israel still accounts for as much as 35% of Gate 1's revenue.
But now, Gate 1's itineraries include Morocco; Portugal; Egypt;
Tunisia; India and Nepal; Sicily and Malta; Turkey; Greece; Kenya;
Tanzania; South Africa; Hungary; Poland; the Czech Republic;
Austria; Romania; Croatia; Bulgaria; Germany, and Mediterranean
cruises.
All tours are fully commissionable to travel agents. "Travel
agents are our whole business," Pipano said. "We do not take a
reservation from anyone without its going through a travel agent.
If we take a call directly, we have an agent referral policy that
works according to the caller's ZIP code."
All of Gate 1's tours are commissionable at 12%, he said. Agents
can earn higher commissions based on volume. For instance, if an
agent books five or more people on the same departure, commissions
grow to 14%.
Another area where agents can earn commissions is on the Web.
Gate 1's site, located at www.gate1travel.com, has been live for
two years now, but on-line booking is on the way.
"The general public will be able to see the product but not book
it unless they go through one of our agent's sites," he said. "That
booking will create an invoice, and we'll be able to give agents
the commission." That commission will remain at least 12%, he
said.
And Gate 1 offers "high-level fams," according to Pipano. "We
don't bog agents down with hotels and site inspections the entire
time," he said. "We give them freedom to enjoy the destination so
they'll leave with a positive feeling about it." Gate 1 keeps two
spots open on each departure for travel agents.
In addition, travel agent educational seminars have been a big
success for Gate 1, Pipano said. "The bottom line is we are
competing against bigger operators, some with over 70 years'
experience in the business," he said. "It's our job to convince
agents that we do things a little different or better. We simply
would not be able to do it without agents' support."
Gate 1 is a no-cancellation guarantee on all of its tours. "We
know how tough a cancellation is for travel agents," he said.
"Barring a circumstance we can't control, all of our departures go
off as planned."
Tour size, Pipano said, is booked as another Gate 1 advantage.
The operator will take no more than 42 travelers, keeping the
experience intimate. "Because of our size, we average about 28 per
tour," he said.
All of Gate 1's tours are considered "soft adventure," even
safaris in East Africa, where the tour "includes a tent, but
bellboys carry your luggage and you have marble floors in the
bathroom," he said. "These days, accommodations are nicer all
around."
Another major change, he said, is the shorter length of tours,
which used to be two to three weeks. Now, they average 10 days, and
some customers want to go for as few as five days, Pipano said.