Diedre and John Bloom travel together frequently. The husband and wife team owns an agency hosted by Avoya Travel, what the host refers to as one of its Independent Agencies.
The Blooms, based in Richland, Wash., were originally government contractors, but they opened a brick-and-mortar agency upon retirement in the mid-1990s. After 9/11, they moved to a home-based agency model; in 2008, they joined Avoya.
But their frequent travels together got Diedre thinking: If something happened to her and her husband, how could they ensure their outstanding commissions would go to their estate?
Enter Carol Howell, owner of another independent Avoya agency based in Dearborn, Mich. Howell started working as an agent 36 years ago and has worked in government, corporate and entertainment travel. For the past 10 years or so, she has sold leisure travel only. She joined Avoya in 2008.
The Blooms and Howell don't remember when they met for the first time — they believe it was at Avoya's annual conference years ago — but they became fast friends.
Recently, they struck an agreement designed to guarantee that their outstanding commissions and clients will be taken care of if the worst happens.
The Blooms and Howell are the first of Avoya's independents to merge agencies, forming a single limited liability corporation: Bloom and Howell.
John and Deidre Bloom
They also put in place a business agreement. Should anything happen that renders the Blooms, both in their 70s, unable to work, Howell will take over their book of business. Any commissions from travel that either of the Blooms booked will go to their estate, and Howell will absorb their clients.
The agreement is reciprocal should anything happen to Howell, who is in her early 60s.
"I had this epiphany," Diedre Bloom said of the idea. "I just thought, what happens — because [John and I] always travel together — [if] there is a joint accident and we both pass? … We have a lot of commission on the books that won't be paid for another year, possibly two years, because we're booking out to 2019."
Howell said it made sense to put the agreement in place now, while everyone was healthy and working.
"We wanted it in place in case something should happen," she said.
Between the three agents, there is a considerable amount of commission on the table. Bloom and Howell is on track to produce more than $4 million this year, Howell said.
In addition to creating efficiencies like paying for only one errors-and-omissions insurance policy, the agreement is also a retirement plan.
While Diedre Bloom and Howell continue to add to their client base, John Bloom is no longer taking on new clients. Instead, he has taken on additional responsibility with his children and grandchildren but is still kept reasonably busy with his existing customers.
Carol Howell
The agreement between the Blooms and Howell grew out of a friendly business arrangement. According to Howell, Avoya encourages its independent agents to find a "buddy" willing to help service clients when an agent is traveling, and vice versa.
"It's really important for us to be able to travel when we want, but we also have to be accessible to our clients," she said. "We build relationships, we don't just take orders. So to be able to give service to our clients when I'm traveling or not traveling, you want to find a good buddy."
Diedre Bloom said that while the topic itself is no one's favorite, planning for the worst before it happens is an important step for a business owner to take.
"Obviously, you never want it to happen, but we kind of felt like if we had put in place everything that needed to be in place, then we don't have to worry about it anymore, don't have to think about it anymore, it's done," she said.
"It was some work to [form] an LLC, but it's well worth it."
Beside estate planning, John Bloom said, the deal also helps protect their clients.
"By assuring that our customers will be handled by Carol, who has the same business outlook [and] ethical outlook that we have, we know our customers are going to be in good hands," he said.
Howell encouraged all agency owners to give some thought to what would happen to their business and customers if something should happen to them.
"You've got to think about when you do want to retire, what are you going to do with [your business]?" she said. "How are you going to protect all your hard work over the years and those commissions, that money that is due to you — and your reputation? You want it to go to someone who will continue the service levels that you have, so it's an important topic to think about. And a lot of us don't."