Chris Greive on the shop floor - riding a camel in Egypt in 1988.
Chris Greive on the shop floor - riding a camel in Egypt in 1988.
Chris Greive's history with the Flight Centre goes back to its Top Deck roots in early 1980s London, writes Grant Bradley.
Flight Centre boss Chris Greive started his formal education in the travel trade in the hurly burly of Earls Court, London, early in the 1980s.
It was a time when dozens of tour companies were out on the street and in pubs touting for business and the shackles were just starting to come off a tightly regulated travel business.
In his first travel job he had the thankless task of trying to sell overland epics for Top Deck Travel - the firm from which Flight Centre was born. Top Deck had a fleet of aged and temperamental double-decker buses and he had to sell to English agents more interested in selling "fly and flop" packages to Spain.
"I was sent to travel agents who were selling two-week holidays in Benidorm and I've got brochures for overland trips to Kathmandu."
Greive got shares in Top Deck in 1983 during "one of its periodic financial crises" and says it was a great place to learn the trade.
The business initially sold tours mainly to Antipodeans. Not only were firms fiercely competitive but many got by on the smell of an oily rag.
"You do learn how to run a business efficiently," he says.
Top Deck's buses had up to two million kilometres on the clock. Part of the appeal of working at the company was the camaraderie born from nursing these buses - with names such as Bollocks, Snort and and Snot - to far-flung parts of Europe including behind the Iron Curtain. Drivers would come up with ingenious ways to avoid road taxes and save money at every possible turn.
In the early days one bus suffered 16 major breakdowns, 72 minor ones and arrived back from a tour two weeks overdue, according to a book tracing the evolution of the company.
"It was a huge amount of fun, the road crew were having a whale of the time," says Greive, who was based mainly in London.
In spite of setbacks Top Deck survived and does today, with newer equipment. The original unique selling point - cheaply refurbished buses - helped it thrive. "It was one of in excess of 30 Australasian travel operators in the coach camping industry and really only two have survived - Top deck and Contiki."
Although he had no formal grounding in the travel industry - in which he has become an important player in this country - life experience was pushing him that way.
He took his first trip within a few months of his birth 62 years ago in rural New South Wales to Auckland where his father, a doctor, joined a practice in Otahuhu. Greive went to Selwyn College where he spent his last year dreaming of going abroad.
He did, aged 18 - first to Australia, then through Asia, teaching English in Japan, and to Canada where he drove mail trucks through the night in the snowy wilds of northwest Ontario. He arrived in Europe in the mid-1970s with enough savings to buy a brand new BMW motorbike from the factory in West Germany. He toured through Europe and Africa but when the money ran out he had to take a job in London as a motorbike courier who typically "had a life expectancy not much longer than a tank commander in the Arab Israeli war".
He ended up working for an advertising firm, married and then came back to New Zealand to do a BA in history and politics. While he said that in theory the qualification was "no good to man nor beast", Flight Centre does actively target people who have done degrees because it shows they can apply themselves.
After university it was back to London where a mate encouraged him to go for a job at Top Deck.
The company's Australian founders - one a vet by training - had by then figured out there was more money to be made selling travel rather than running tours themselves so set up Flight Centre selling discounted airfares. Top Deck kept the tours going but also got into selling travel as well.
The early years were like the heady days of pirate radio - anti-establishment and lots of fun. The "bucket shop" plane ticket retailers were shunned by the established agents and airlines were initially fairly sniffy about them.
The bucket shops worked on the principle that second-tier carriers couldn't compete with established government-owned airlines and by bending International Air Transport Association rules (which prevented discounting) were able to sell cheap seats, Greive says.
"We were very disruptive, some airlines refused to deal with us, our philosophies were different from travel agents at those times."
He bought more of the business in 1987 before coming home three years later, investing in Flight Centre New Zealand and serving as managing director until 2004. It was a period of rapid growth from five stores to more than 120 and diversifying into other travel brands. Initially the weak economy helped.
"In the early 1990s there was a soft economy and high unemployment. Those conditions were good - we could find good locations so we could find good people very easily, especially those who were coming back from overseas."
By 1995 the company was ready to go public and became something of a "millionaires' factory" for staff who took up the chance of 50,000 shares at A85c each. Within five years the Flight Centre millionaires' club stood at more than 100.
Greive was appointed to the global board between 2001 and 2004 and remains in regular contact with Top Deck/Flight Centre's now very rich founders.
In 2006 he was in the middle of a bid by private equity firm PEP to buy the business and delist it.
"Thank God it didn't happen - we'd have been loaded up with debt - being a listed company is little bit onerous but it's not that bad."
He says Flight Centre remains fiscally very conservative.
While accused of running a lazy balance sheet cash is important for a business vulnerable to big global shocks such as terrorist attacks and pandemics that can halt travel in some areas overnight.
"It [Flight Centre] likes to say it could run the business with no income at all for three months."
When he left Flight Centre in 2004 the aim was more travel in semi-retirement, basing himself at a house he had in Spain. It didn't quite work out like that.
In 2006 he bought into the Barkers menswear chain. He wasn't especially interested in clothes but saw it as a good business to own for some time then sell.
Nine years later he has a 65 per cent stake and has seen the brand refreshed and new, themed stores opened. Like travel agents, clothing retailers are vulnerable to online sales so the physical stores have to have the right look, be in the right place and offer the unique service.
Last year the job of heading the New Zealand Flight Centre operation came up again. He was interviewed by the founders for the job.
"I thought they'd say: 'Chris you're too old.' I've been doing it for a year, I'll do it for another year and then they'll appoint someone else."
One senior airline executive, Air NZ's chief of sales and revenue, Cam Wallace, says Greive's return has been good for the industry. "There's huge respect for him from the competition, from airlines and around the market because of his history."
Greive says that while the business environment is vastly different to when he joined Top Deck 34 years ago - mainly because of internet booking sites - many core philosophies, especially around team structure, remain the same at Flight Centre.
The business is still organised into families (typically teams no bigger than seven staff as that's the maximum number who can be managed effectively and efficiently without extra skills) villages (three to seven teams or businesses) and tribes (20 to 30 shops and businesses).
When Flight Centre started it was notorious for low basic pay but big commissions for successful agents.
Greive says the pay's improved but the emphasis on commission remains. It's uncapped and the company here in New Zealand has salespeople earning $150,000 a year.
"What gets rewarded gets done," he says.
The firm has been a frequent winner of best workplace awards in the past and Greive is described by colleagues among 1150 staff as embodying its egalitarian culture.
The Auckland headquarters is open plan, he's out on the floor with the rest of the staff and wears the same uniform. He keeps a low profile - he's seldom in the media and skips most of the numerous trade functions.
He's got firm views on workplace culture. "We dislike hierarchies with a passion - I don't have a carpark so I ride a motorbike. I think people react so much better when they don't see their boss as someone who is aloof and disinterested."
Captain on board
Photo / News Corp Australia
The Flight Centre captain used in advertisements since the late 1980s was the brainchild of founder Graham "Scroo" Turner, says Chris Greive.
It became a sought-after role for actors who enjoyed a high profile in Australia, where most of the business is based.
"Typically they become too famous and they become too demanding and we had to find another one," Greive says.
"We've had a number of different captains along the way. One was actually a pilot."
While the captain still appears in ads the mannequin outside stores was phased out a few years ago. "We don't have them any more, which is a bit of a shame."
Travel agents survive the do-it-yourself age
Although the number of agents has fallen, from some small mom and pop stores to chains like Stella, House of Travel and Flight Centre, they are hanging in there and the big ones are thriving.
The slow death of physical travel agents has been predicted for years.
Three years ago a recruitment company put travel agents among the five most likely jobs to become extinct by 2017.
The theory was that direct booking through airlines and booking sites was going to kill them off. But although the number of agents has fallen, from some small mom and pop stores to chains such as Stella, House of Travel and Flight Centre, they are hanging in there and the big ones are thriving.
The boom in outbound travel thanks to the high New Zealand dollar, cheaper flights and relatively healthy economic growth have helped but the fundamentals of bricks and mortar businesses haven't disappeared, especially where they can leverage deals through their size.
Airlines found out that it's costly to set up booking sites and Air New Zealand, which embraced the online model to try to cut out agents, has under chief executive Christopher Luxon worked much more collaboratively with the trade.
Morningstar's Farina Parsons analyses Flight Centre and says physical travel agents in New Zealand and Australia have a unique advantage.
Travel from this region is often complex and in spite of booking sites getting easier to use, she said most travellers preferred the assurance of an agent making the arrangements.
Flight Centre was especially well positioned in Australia with about 40 per cent of the market and buying power to get better deals than their competitors.
While the firm had to issue a profit warning early this year because of soft performance in the Australian market, Parsons said in New Zealand the firm's revenue was up about 12 per cent to around $420 million last year.
It makes anything from 2 per cent to 10 per cent commission on international travel with net margins of around 2.5 per cent.
Flight Centre NZ managing director Chris Greive says his firm hasn't got it completely right in the past and has had to adapt.
It is about to launch an online booking tool for customers to use on the assumption they will continue to work with a travel agent. His company was also rolling out more "stores of the future", larger open plan spaces where consultants aren't stuck behind counters, and roll two or three smaller stores into a prime site.
House of Travel commercial director Brent Thomas says his chain was thriving too although he put the total number of agents around the country at 400, down from 800 at their peak.
"There's been consolidation throughout the industry, those with economies of scale continue to go from strength to strength."
