Exit is a matter of timing, and the natural time to sell a business, if it is not being passed down to the next generation, is when things are on the up. Personal situation, family situation, short- and medium-term prospects all must be considered. In that respect, the timing couldn’t be better for John and Peter Johnson who, in July, stepped down from coaching for good.
The pair have sold their business to The Coach Travel Group, a consortium of seven coach operators that also comprises Alpine Travel, Barnes Coaches, Coatham Coaches, JH Coaches, Swans Travel and The Ready Group. As they say goodbye to the industry to which they have both devoted some 45 years, they do so with high hopes for their business, the consolidation, and the coach industry.
A dynamic relationship
Peter and John could be described as The Odd Couple of coaching. They each joined the family business in 1979 and 1978, and have in that time shared a “dynamic and sometimes challenging relationship”. Peter, whose focus has been on the engineering side, prefers to remain in the background. It is commercially minded (and more diplomatic) John, who began pioneering the tourism programme in the 1980s, who is the face of the company. Both have the same ethics and beliefs at heart and with their retirement coaching loses one of its strongest advocates. A former Director of the Coach Tourism Association, John’s enthusiasm and knowledge has always been shared through a strong voice. That makes it all the more surprising that he has chosen to step back from the industry.
When discussing his retirement, John does acknowledge that, in an ideal world, and with a 115-year-old business on its third generation, a fourth-generation family member taking the baton would have been preferable. But things are never simple when the business is split between two brothers who both have children through two marriages. For various reasons, things did not work out. No other family members are involved in coaching. Not everything can be planned for in a business strategy.
John’s decision to sell was driven largely by the invitation to join The Coach Travel Group. That project required a Midlands operator. Coaching is by nature a regional endeavour and benefits from co-operation between fellow businesses. There was a reluctance to miss that opportunity at the risk it would leave the company weaker in the future. Combined with the fact John turns 65 this year and Peter 68, it seemed like the right time to sell, and hand over the operation to a younger, more energetic team.
“Business is business,” John says. “We are third generation, passionate about customer service and looking after our staff. But we never wanted to be old-school boys giving outdated views. We never want a scenario where we would impose a view that can be seen as being out of touch. So the best thing for this company, its staff, customers and suppliers, is to say: ‘The king is dead. Long live the king’.”
Consolidation is the future?
The fundamental principles are clear, according to John. He sees the consolidation as making savings on purchases because of economies of scale. Benefits of sharing work at peak times. Maintaining a business within a group, increasing its private hire and holidays.
“Right from the start we thought that the coach industry is right for consolidation,” he explains. “As compliance and expectations grow, especially driven by decarbonisation, the coach industry will be in many ways required to adapt as the bus industry is doing. Larger groups have the strength of buying and of operational efficiency. If we were required to convert to electric, it would cost a huge sum. That would be difficult for Johnsons to afford on its own. Storing hydrogen would bring safety concerns. The very nature of it will drive consolidation.”
That can be tough to hear from what has long been seen as an archetypal family business. Can a company go corporate while retaining its traditional image? “Peter and I knew that it would happen sooner or later,” John says. “We did have hope for that fourth generation, but as soon as we knew it wouldn’t work out, we had to develop a team to run the business. We didn’t want to be tied to it the rest of our lives. We’ve given 45 years of serious hours to the company over the years, and faced some serious challenges.
“The reason we wanted to sell to The Coach Travel Group is that it wants to retain the original brands, while adding ‘The Coach Travel Group’ beneath it. This isn’t just about the colour and the name on the coach. It’s what everybody buys into. People tell us when they have seen our coaches in Austria, York, or Dover. It brightens up a person’s day. They feel an association, a connection with the brand. Large companies talk about brand value, and there is a lot to be said for it. That’s why we went with The Coach Travel Group. It promises to bring efficiencies, savings and profitability, but it will keep the individuality of the businesses.”
‘End of a chapter’
The handover process to an internally appointed senior management team has been ongoing for some 13 months, framed by a sense of inevitability. It comprises Kyran Flynn as General Manager, Lauren Davies as Head of Business, Sales and Marketing, Andy Leyland as Head of Finance, and Ashley Brown as Head of Operations. Johnsons and its 55 vehicles are now in their hands. That no external management has been hired is an important point for John.
“It’s the end of a chapter, and I’m happy with the ending,” John says. “So far as Peter, independent family ownership and I are concerned. It’s the end of one era, the start of a new and exciting one for Johnsons. We are putting this company in a good position, with a good leadership team that will ensure this company thrives and succeeds in the future. The last thing Peter and I wanted was to see the company become a faceless part of a group. There is strength in creating a network of operators that can and are happy to work together. We have a flexible product that can meet anybody’s expectations.
“The biggest thing that has kept us in this business for 45 years has been the fact it’s a great industry to be involved with, with great people. It’s an industry passionate about looking after its customers and operating professionally. Peter and I have always been proud of what this company, and this industry, have achieved.”
