Seeking limopreneurs: Tulsa limo operator builds small-biz startup program

Seeking limopreneurs: Tulsa limo operator builds small-biz startup program


July 25, 2007

TULSA
– With a 16-year growth record behind him, VIP Limousine owner Charles
“Chuck” Cotton intends to help would-be chauffeurs duplicate his
success around the nation.

Owner of VIP Limousine Charles “Chuck” Cotton sits Tuesday in his newest vehicle, a stretch Hummer H2.  (Photo by Rip Stell)

Starting with an ad in USA Today, Cotton launched Limopreneur,
a Tulsa-based offshoot of VIP that helps customers open a turnkey
home-based business. For $94,200 – initial deposit of $5,000, the
remaining balance due before starting training – clients receive two
weeks of hands-on education in Tulsa and Oklahoma City, often as the
student either of Cotton or his wife, Joan. Included are room and
board, meals, transportation, detailed operational materials and
personalized instruction on everything from finance and marketing to
chauffeuring a vehicle.


Owner of VIP Limousine Charles “Chuck” Cotton sits Tuesday in his
newest vehicle, a stretch Hummer H2.
(Photo by Rip Stell)

When that’s complete, Cotton takes them to Springfield, Mo., where
the “limopreneurs” will take possession of a new, certified 120-inch
Lincoln or 130-inch Cadillac Superstretch Limousine. Driving it home
starts their business.
In the one week the ad has run, Cotton
said limopreneur.com recorded 5,000 hits. About 10 percent of those
qualify as legitimate potentials, with one prospective client already
on the line from Phoenix.
 
“What we’re doing is selling
limousines that we broker for various manufacturers, and the business
opportunities along with supporting methods and materials for a
limopreneur to succeed in his business market,” he said. “I’ve made
every mistake in pioneering a company through the years. With
Limopreneur, we will share all of the successful lessons that we found,
which will save them thousands of dollars.”
Cotton identified 400 secondary cities as ripe targets for Limopreneur.
 
“In
the next 24 months, we feel that we will have operations by independent
limopreneurs in 100 of these markets,” he said. That could return him
up to $2 million in profit.
“And our profit is all upfront,” he said with a smile.
 
Built on special events
It’s built upon his firm’s two decades of growth in the Sooner State.
 
VIP
now stands as the largest limousine company in the state, its fleet of
17 stretched vehicles and black sedans holding 35 percent of the
market. From his 1991 start with but $33,000 in gross revenue, Cotton
said his family company has enjoyed 16 straight years of record revenue
growth to top $1 million annually.
“Which is substantial for the Oklahoma market,” he said. “We’re not a 24/7 operation like they are in larger cities.”
 
VIP
managed that growth in the face of rising gasoline prices, which it
does not pass on to the customer – “unless fuel goes to $4 a gallon, I
won’t have to” – and the impact of company migrations, the telecom
downturn and terrorist attacks.
 
“The marketplace went down
severely after 9/11, but it has now bounced back,” said Cotton. “The
other limousine companies in Oklahoma are experiencing growth also.”
 
With
his revenues up through the first half of 2007, he foresees 8-percent
growth this year. Cotton projects a 10-percent advance next year as the
BOK Center and several Bricktown venues come online.
“Nothing
is recession-proof,” he said, reflecting on his steady increases, “but
it’s a pretty good hedge against inflation because families are willing
to spend their hard-earned dollars on a limousine to celebrate.”
That marks his key selling point for Limopreneur: VIP’s established success in building special-event business.
In
major markets like Dallas or New York, he said corporate transfers from
hotels to airports might make up 90 percent of a limo company’s
business. For the Cottons, it’s only 10 percent.
 
Special
occasion trips comprise 90 percent of his revenue, from such staples as
birthdays, weddings and funerals to seasonal events like Christmas
light tours and holiday parties.
 
“That’s a market the
national companies ignore,” he said, leaving it ripe for limopreneurs.
Cotton even credits that resilient sector for helping his firm not just
survive, but grow during the 2001 downturn, which came one year after
daughter Stephanie led VIP’s expansion into Oklahoma City.
 
Positive cash flow
Since
Limopreneur does not involve a franchise with long-term marketing or
consulting fees – or exclusive market territories – Cotton said he was
able to keep it affordable to baby boomers seeking to start their own
businesses. He also has financing assistance options available.
 
Cotton’s
major expense comes from the stretch limo Limopreneur provides each
client. Although VIP gets a discount, the limos its starts with can run
around $72,000.
 
“There was an article in the Wall Street
Journal that said less than 2 percent of people turning 65 today can
retire,” he said, explaining his motivation in starting Limoprener.
“With this, a family that wants to work can make an average income of
approximately $1,500 net each month.”
 
At first, being a
limopreneur may require 14 to 16 hours a day. Cotton draws that from
his own startup experience, when the former high school instructor,
stockbroker and Balfour sales representative personally managed the
calls and drove the limo. His wife, also a former high school teacher,
also participated in every aspect of the operation. His daughters
detailed the car after each use.
 
Cotton reinforces that discipline by having limopreneurs work similar days for VIP as part of their training.
“But
it can return very quick positive cash flow after the first 60 days of
operation,” he said of the workload. “If the limopreneur follows our
program.”
 
Cotton plans to give these customers about a
five-year head start. He then intends roll out VIP company-owned shops
across the nation, building a network to capitalize on special event
bookings.
“I kiddingly say that we’re in the entertainment business,” he said. “But we are. We sell the mystique of the limousine.”
 

 

 

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