Challenge: G.A.P Adventures Inc., a Toronto-based tour operator, was outgrowing its in-house operating system. G.A.P’s original network, created by president and CEO Bruce Poon Tip in 1992, used a Filemaker relational database but relied on a weekly fax update to appraise sales agents worldwide of tour availability. It served its purpose for a while, but the growing business — G.A.P annually runs more than 800 small-group adventure tours in 100 countries — soon taxed it to the max. “It was a mix between a database system and a manual system, and to be honest, it was very bad,” says Poon Tip. “It couldn’t handle any sort of volume and it was not competitive enough. It met an industry standard, but our industry is behind the times when it comes to technology and integration.”
G.A.P wanted to offer consumers and sales agents the ability to check the availability of individual tours and book space in real time over the Internet, information that could fluctuate in a matter of hours. Initially, Poon Tip looked for an off-the-shelf solution, but the only existing software packages for the travel industry were designed for mammoth coach and cruise lines or all-inclusive “sun companies”. They were expensive too, at $300,000 to $400,000 a pop. And they lacked the multi-point flexibility G.A.P required for its worldwide business, where tour leaders and guides are all part of the operations system. “When you book a resort holiday with airfare included, it’s a very straightforward transaction,” Poon Tip explains. “Our operations are dramatically different.”
Solution: Poon Tip decided to turn a challenge into an opportunity. He hired a seven-member IT crew to develop new travel operations software — named Compass — under the spinoff company Great Oceans Technology. The idea was to underwrite the development by selling Compass to small and medium-sized travel companies that didn’t compete with G.A.P. Poon Tip soon had clients at the door, deposits in hand.
While growth is a good thing, its timing can prove difficult. In 2002, just as the first round of Compass installations were ready to roll, the nature of G.A.P changed dramatically when it acquired Global Connections, a mainstream flight and accommodation company, doubling G.A.P’s size overnight. Global Connections had its own software, but rather than run with two systems, G.A.P took Compass back to the shop for redevelopment with the needs of Global Connections in mind. “It threw us for a technical loop,” says Poon Tip. “But in the end it made our system better than it was before, even more usable. Compass is now a really robust system for small to medium-sized tour operators of any kind.”
R.O.I.: The new and improved Compass system is slated for delivery by the end of 2003. (Existing clients agreed to wait for the updated version.) Priced at $40,000 to $60,000 depending on the various plug-ins, it fills a niche not served by existing software solutions. According to Poon Tip, there are thousands of small tour companies that only run one or two thousand passengers a year — skiing tours, biking tours, diving tours, long-stay house rentals — and all of them are prospective clients. “I think the revenue potential is huge. It has way more potential than our original core business because we’re in such a niche market,” he says. “It’s a different kind of game because once you get someone using your software, they become a customer for many years.”
As G.A.P Adventures pushes sales past the $50-million mark, president and CEO Bruce Poon Tip is developing yet another operations software, larger and entirely Internet-based, to accommodate the company’s future needs. Both its current software and the new system — slated for completion in 2004 — will be sold to other tour operators.
© 2003 David Zimmer