Travel-support services 'on front lines'

By Chris Woodyard
USA Today

LOS ANGELES — It takes a lot of faces to launch a thousand trips.

Delta Air Lines skycap Miguel Sunein is back to pulling full loads of bags on his cart at Los Angeles International Airport. The travel industry's supporting cast of workers also had to cope with Sept. 11. Gannett News Service

They may be a smiling skycap or a hotel's desk clerk. Or employees of a small company — the hotel florist, airport parking operator or airline caterer — who work behind the scenes.

Airlines, hotels, restaurants and rental-car firms may be the stars of the business-travel economy, but often overlooked are thousands of companies whose prosperity also depends on lots of people taking lots of business trips. Many of those companies were hurt last year by a weakening economy, then clobbered after the Sept. 11 attacks decimated travel.

Finally, after months of cutbacks, layoffs and out-and-out failures, there is hope. And, yes, in the $563 billion-a-year travel industry, it's the little guy who appears to be leading the way.

"We're right on the front lines," says 30-year skycap Kevin Smith at Los Angeles International.

When it comes to travel, the breadth of the supporting cast is staggering. "No matter how small your job, it's important," says Dee Minic of the Travel Industry Association.

Hilton Hotels has 3,500 suppliers who deliver everything from paper towels to caviar to its 2,000 hotels. Fifteen trucks may unload at one hotel in a given day.

Hilton's central laundry for the New York area cleans and presses 100,000 pounds of sheets and pillowcases, with 160 workers and loads of high-tech machines.

As more travelers return to the skies, travel-related businesses are cautiously optimistic.

"You feel it," says Stephanie Haymes, co-owner of Cicada, a fancy restaurant in downtown Los Angeles that specializes in group business. "I think it's coming back."

But there's still a way to go.

Cicada's fortunes are tied to Los Angeles' convention business, which has fallen about 20 percent since Sept. 11.

Here's how a few of the service companies are faring:

• Airline caterer.

As soon as airlines were flying after Sept. 11, many quickly curtailed in-flight meals. But, little by little, food has found its way back aboard planes.

"We're coming out of the trough," says Darwin Day, senior vice president of LSG Sky Chefs, the nation's largest airline caterer.

The company closed only two of its 83 flight kitchens and still employs 9,100, on the way back toward 12,000 before Sept. 11.

• Business travel magazine.

The outlook was grim when travel came to a standstill. "When it happened, I got a lot of calls wishing us well," says Francis Gallagher, publisher of Business Traveler magazine.

Airline ads dried up. Airport newsstand sales dwindled.

The magazine retooled. Gallagher says the staff started an e-mail newsletter to improve contact with readers and beefed up the Web site, Businesstravelerusa.com.

It's paying off. American Airlines and British Airways, two big advertisers, are coming back to Business Traveler's pages. Airport sales are rising.

• Airport luggage-cart provider.

For a company that has been around 30 years, Smarte Carte isn't exactly a household name. It provides the luggage carts for rent at almost every U.S. airport.

Business fell 40 percent after Sept. 11. The company was forced to lay off workers, most of them at its headquarters near Minneapolis. About 250 of the company's 1,300 jobs were lost.

Rentals are still about 15 percent lower than a year ago, but gaining. The outlook depends on how quickly flight schedules bounce back.

"We don't know what normal means anymore, what with the capacity that's been taken out of the system," says Smarte Carte CEO Ed Rudis.

• In-flight entertainment network.

Sky Radio had a big business — its broadcasting of radio-style talk shows on airline entertainment systems. It packaged celebrity business leaders with CEOs of companies who paid for the chance to be interviewed by founder Marc Holland.

Overnight, business evaporated. Holland had to lay off nine of the operation's 19 employees.

The future, he decided, depended on changing the business model. He signed deals to give companies exposure not only through Sky Radio, but also through airport signs and billboards. And he changed the pricing to reflect the cost of reaching actual listeners, rather than just the cost to be placed aboard a certain airline. He also created special programming to address travel fears.

Business is picking up, he says, but it's not back to normal.

• Passport provider.

Instant Passport & Visa, a Providence-based company that expedites travel document issuances to passengers in a hurry, saw revenue drop by half after Sept. 11.

Its founders ripped up their paychecks to conserve cash, laid off three workers who were in training to join the staff of 20 and looked for new opportunities.

They reasoned: With the world a more dangerous place, wouldn't travelers want to know safety in the places they intend to go? Instant Passport teamed with iJet Travel Intelligence and WorldCell, an international cell phone company, to bundle their services.

With airlines' bargain-basement deals, up popped vacationers who might not have gone anywhere otherwise. They needed passports and visas — right away.

The turnaround was complete. Instant Passport's business is 20 percent higher than before Sept. 11.

• In-room entertainment provider.

On Command suffered as hotel occupancy fell. The decline was particularly felt in the loss of business travelers, whose expense accounts and lifestyles make them more apt to pay for an in-room movie.

The company's net loss in the fourth quarter was $34.1 million, compared with a $19 million loss during the same quarter of 2000.

The business traveler is returning but often is on a tighter budget and has less time to watch a movie, CEO Chris Sophinos says. So he packaged a channel of shorts — "Seinfeld" reruns, classic ESPN game match-ups, HBO's "The Sopranos" — as a lower-cost alternative.

• Airline nut roaster.

King Nut, which packages peanuts and snacks for six of the eight largest U.S. airlines, is in the unusual position of having seen business pick up after Sept. 11. As airlines switched away from full in-flight meals, they tried to make up for it with low-cost snacks.

When commercial flights were grounded immediately after

Sept. 11, "we probably laid off half our company," says Executive Vice President Martin Kanan. But when flights resumed, "we were able to get new business and contracts."

Of course, it didn't hurt the 125-employee company that its largest customer, peanut-happy Southwest Airlines, didn't reduce its flight schedule like other airlines.

As long as peanuts are cheaper than chicken breasts, King Nut knows it has the sky covered.