“You’re not going to be around in another five years” said the person sitting across the board room table from a receptive tour operator during NAJ’s Salon discussion group two months ago in New York City as a group of a dozen travel suppliers and receptive tour operators gathered to discuss near- and long-term issues confronting the inbound tour and travel industry in the USA.

No one seemed to blink or make a serious effort to counter the statement. It came, after all, in the midst of a colloquy over challenges confronting U.S.-based receptive tour operators (RTOs)—especially small and mid-size companies—which are many: mergers with, and acquisitions by, larger companies; the growing tendency of some international tour operators to buy product directly from supplier websites and online travel agencies (OTAs), thus eliminating the need for signing cumbersome paper contracts with RTOs; technological developments driving the growth of ticketless admissions that compel RTOs to equip themselves with expensive programs in order to accommodate large groups visiting attractions or taking ground tours; and the growth in the number of overseas travelers who are bypassing agents and operators in their home countries and putting together their own travel packages and itineraries from U.S. supplier websites.

The challenges notwithstanding, Jake Steinman, CEO of the NAJ Group, which organized the Salon—there was another Salon just days prior in Orlando—offered the opinion that “receptive operators are crafty and resourceful … they’ll find ways to survive and be relevant.”

How they will survive and be relevant is what the Inbound Report’s editor talked about with Steinman, who offered examples of what he meant—examples based on his visits and discussions with receptive tour operators during his annual autumn Listening Tour, during which he calls on RTOs in New York City, Orlando and Los Angeles, where the overwhelming majority of U.S.-based receptive tour operators are headquartered.

In sum, RTOs today are surviving by adapting as they:

1. Redirect resources and personnel, working for new business outside of their traditional client bases;
2. Offer new services to their existing clients; and
3. Expand the definition of what a receptive is by selling outbound travel as well.

—For instance, GTA, the bedbank component of the Kuoni brand—Kuoni’s remaining assets were acquired earlier this year by the EQT Partners, the Swedish private equity group—has dropped participating in some major international trade shows, including the World Travel Market and ITB, where a two-story stand—including staffing expenses—can run over $400,000.  The rationale is that they already know 90% of the customers attending those shows as they have sales staff in scores of countries who call on them regularly.

—Another Kuoni operated company, AlliedTPro—established in the early 1960s its lineage makes it the oldest receptive tour operator in the U.S.—is also effecting such economies and targeting by reducing their presence at trade shows in favor of networking and social “schmoozing” events. Both AlliedTPro and GTA have space in the same Manhattan office building.

—In the past three years, with the burgeoning growth of air traffic from India through gulf carriers as well as substantial increases in the number of visitors from Arab countries, many receptives have begun participating in the Arabian Travel Market in Dubai. Three years ago Emirates, Qatar and Etihad airlines, recognizing a woefully underserved market, began aggressively courting India passengers headed to the US to connect through their hubs by offering shorter connecting times and better service.  Combined, the three carriers offer 26 flights a day serving 12 U.S. cities.

—At Manhattan-based TeamAmerica, known for its upscale product, Enzo Perretta, the company’s founder (in 1997), CEO and managing director continues be an acknowledged “ahead-of-the-curve” thinker and practitioner of new sales and marketing tactics. He now has a mini-theatre in the basement of the company’s Manhattan offices where travel agents and other travel trade professionals are invited in groups to view presentations of the company’s product line. The company has also expanded the number of trade shows it attends and are the official ground operators in the Easter US for TUI.

—Established in 1994, Orlando-based Tourico Holidays has grown to be a billion-dollar-plus per year business by constantly looking for business where no one has sought to look for it before.  Lately, several years after it established a presence with offices in China, it has approached Jaiyuan, the Chinese equivalent of Match.com in booking travel for singles getting together. Such a niche was not a wild guess. Rather, research had shown that millions of Chinese who grew up as a sole child under China’s “one child” policy found there was an extreme imbalance in the male/female populations in the cities in which they lived, causing  60 to 70 percent of them to find matching results in other cities distant enough to require an overnight stay.  Tourico is working to power the dating site with their inventory.

—Also, another out-of-the box distribution idea that was generated from one of the graduates of the Tourico Travel Academy, was to explore working with automobile dealer groups—several of which own more than 240 dealerships nationwide—to provide vacation packages (rather than rebates or similar premiums) as incentives for purchasing a new automobile.

—Tourico has an advantage that no other receptive tour operator has in seeking out such new business channels. It lies in the constant succession of the groups of 30 or millennials who comprise the student body at the Tourico Travel Academy. Created three years ago to educate and train potential employees (the overwhelming number of college graduates who complete the Academy’s 10-week curriculum are offered jobs at Tourico) for the company, the students provide an ever-present caucus of brainstormers who come up with new or uncharted ideas.

—While there is no hard and fast number of those who are doing so, an increasing number of RTOs that are subsidiaries of overseas operator companies or have a customer base in one country, are selling outbound travel—a trend that traces its beginnings to West Coast-based offices of the U.S. receptive tour operations of Japan-based tour operators.