When Michael Sibley, president of LaPlace Travel Center in LaPlace, La., and a group of investors decided to enter the travel plaza business, they saw it primarily as a means to run their minicasino operation. They soon learned it could be much more.
“Our hope was that we’d break even on the truckstop, but after it was up and going we realized if we focused on the truckstop and restaurant we could make money at that as well,” Sibley said.
The location sits at the intersection of I-55 and I-10 and opened in 2000. It had an initial group of eight investors. Today that number has dropped to five and Sibley is the youngest and most active in the business.
The group met when they invested together in a commercial bingo hall. When the state of Louisiana changed some of its gaming laws, the group decided to branch out into the truckstop business.
“The video poker side has always been the predominant profit center and accounts for a substantial portion profits of the organization,” Sibley said.
The location’s other profit centers include a convenience store and a Huddle House restaurant franchise.
Initially, the investors hired a c-store management company to run the business and Sibley, who is also a certified public accountant, kept his day job.
“I was completely new to the industry and was totally reliant on the consulting company. After being in business for 10 years under that scenario, I decided to quit my job as a legal administrator and go to work fulltime in the business,” he said.
His biggest learning curve was learning the retail market, working with vendors and monitoring profit margins.
“The people who do well in the industry are good at focusing on every penny and squeezing every little bit of margin that they can,” Sibley said.
Since Sibley took on a more active role, sales and profits have increased, which he attributes to a lot of small changes.
“It’s the continuous changing and refining of things and implementing ideas that I get from every retail place that I visit, including the big boys,” he said. “I seem to find myself making observations everywhere I go, looking for ideas of something they’re doing, and I ask myself, ‘Why don’t I try that?’ Because we don’t have a big corporate structure, I can try new things easily. Some things work and some don’t.”
Today, the group of investors meets once a month and Sibley provides updates on the business. “If there are big issues, I seek their input. Luckily they’re comfortable with me, and we have been very fortunate with the success that we have had,” he said. “From the beginning we had created a modest dividend that we could pay to each of the investors.”
Sibley doesn’t always visit the location every day. “Thankfully, the managers I have are great and they know their jobs very well,” he said. “I try to go there a few times a week for at least a few hours each day. I’ll do a site survey, ride the parking lot, make note of things that are new that they might not be aware of. I walk the store and after that come up with a list of things I want to discuss,” he said.
Sibley credits his employees with the location’s success. “I can have as nice of a business and as good of a facility, the prettiest, cleanest place, but if I have bad employees, I’m not going to stay in business.”
Karla Lewis, Sibley’s restaurant manager, has been at the location since it opened. “We have a lot of locals in the restaurant. That is because of her and her relationship with the customers,” Sibley said.
LaPlace’s c-store manager, Tawanda Henry, was recently promoted to the manger position after being at the location for three years. “She is sharp and enthusiastic and her workers respect her,” Sibley said.
Sibley has 35 full-time employees in the c-store and truckstop portion of his business. He leases the video gaming portion of the business to a separate company and they split the profits.
Because his managers’ time is consumed with day-to-day operations, Sibley said he also takes on nearly all of the special projects for the locations, such as ways to cut costs or improve operations. “If I go to a bunch of c-stores and everyone else is using Styrofoam cups and I’m using paper cups, I’ll make note and I’ll take that on as a project to research if I am missing out on an opportunity to save money or make a change customers are looking for,” he said.
Sibley also said he jumped on the opportunity to work with Darren Schulte, NATSO’s vice president of membership, who did a site visit and provided a list of ways Sibley could improve the business.
“He gave me a 30-plus page report all about making improvements with what we already had. I thought I did a good job of keeping clutter away from our cash registers, but after Darren pointed out to me how cluttered it was, I further eliminated things around the counter. From a customer standpoint, that is what makes them more comfortable,” Sibley said.
With Schulte’s help, Sibley also realized he had a lot of duplicate items. “I was getting gloves from both my grocer and a vendor for trucker supplies. The retail and margin on one was a lot higher than the other. Darren pointed out that I was giving people a chance to buy down,” he said.
Operators can take advantage of Schulte’s retail advice by reading NATSO’s blog where he is a frequent frequent contributor.
With a location in Louisiana, hurricane preparedness is a way of life for Sibley. To prepare for storms, Sibley has an emergency generator that can power the whole location, and he stores his company data in the cloud. Because he can’t process credit cards without a connection, Sibley has a back-up plan for his internet and has a 4G data card connected to his router. He also keeps a list with employees’ cell phone and emergency contact numbers and talks with them about who can work as the storm nears.
“We stay open as long as it is safe to do so. Not only do we have an opportunity to make sales, but we also serve to help the public evacuate.”
He created an incentive plan to keep employees on as long as possible without putting them in harm’s way. “The longer they work, I bump up their pay and the first people to come back get an incentive for coming back early.”
Sibley put all of his plans into action when Hurricane Issac passed through in August 2012. Unfortunately, the storm damaged La-Place Travel Plaza more than any other hurricane had, but because of his advanced planning, Sibley was able to get the location back up and running quickly.
“The roads will get impassable with every hurricane, but this was the first time the building flooded. The water was up three feet or more on gas pumps and we had about seven inches of water inside the building,” Sibley said.
It took days for the water to recede enough for Sibley to get to the location. “From the elevated portion of the interstate, I could hear that my generator was running. After a few days, we could get to the location and had a cleanup work day. People in high trucks brought employees in through the floodwaters and we cleaned up,” he said.
Business picked up quickly as soon as the location reopened. “We were busy and made up the money we lost from being closed for a few days,” he said.
Sibley said his greatest hurricane lesson has come from dealing with his insurance company. “I realized that a lot of our assets are not covered. My building and its contents are covered, but things outside aren’t. My pumps or storage containers weren’t covered, and I learned that the hard way,” he said.
Stop Watch covered how to prepare for natural disasters in 2011. View the article, Advance Planning Minimizes Truckstop Losses from Natural Disasters, for more tips.
Photo Credit: LaPlace Travel Center
This article originally ran in Stop Watch magazine. Stop Watch provides in-depth content to assist NATSO members in improving their travel plaza business operations and provides context on trends and news affecting the industry.
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