Network: April 1991
Robert Johnson is developing software for airline reservation systems. He's sure his product has potential, but before he goes any further, he wants to know what the airlines need, what the government requires, and how to protect his idea (Travel Advisory, January, [Article link]).
For information about airline systems, Mr. Johnson should first investigate the major travel automation vendors: Covia, outside Chicago, (708) 518-4000; Saber, a division of American Airlines, in Fort Worth, (817) 963-1234; System One, in Houston, (713) 751-4300; and Worldspan, in Atlanta, (404) 916-7400. Second, he should contact one of the airlines that operate independent reservation systems, such as US Air or Delta. And he should also research independent consultants working in this field. For the names of consultants, he should look at Travel Weekly (201-902-2000), a newspaper that regularly reports on travel automation.
Mr. Johnson can patent his software; I hold a patent for the reservation system I developed. However, it may not be worth his time, since his product, if viable, will probably be put into service before he can get it patented. Other protection is available. He should request that consultants sign a nondisclosure agreement before he discusses his idea with them. He can also copyright his software.
Regulations governing reservation systems fall into two categories: those that deal with the operation of the system and those that deal with general computer operations. An example of the first: the ordering of information on the computer screen can have an impact on which flights are sold, so to eliminate bias, regulations govern the way flight information is prioritized. The second type of regulation would deal, for instance, with glare from the terminal screen and its effect on the health of an operator.
Mr. Johnson should discuss all of this with a lawyer. It may save him many false steps.
David C. Vollrath
Vollrath International Inc.
Miami* * *
Our company is also developing software for the airline industry. We've found it difficult to research marketability and end-user requirements. I suggest Mr. Johnson survey airline personnel who use reservation systems. He should also develop a relationship with at least one airline so he can later test his product. All this is slow and frustrating work, but the payoff for a viable product makes it worthwhile.
John W. Farley
Technical Systems Group Inc.
Judith Morrison found a market for her sports-theme greeting cards in sporting-goods stores throughout her home state, North Carolina. Now she wants to cross the border, but she's having trouble meeting qualified national sales reps (Card Carrying, January, [Article link]).* * *
Judith Morrison should consider attending North America's largest sporting-goods trade show, the National Sporting Goods Association's Sports Expo '91 in Chicago from July 15 to 18. Call the association at (708) 439-4000. She should also contact the Sporting Goods Agents Association, in Morton Grove, Ill., at (708) 296-3670. Lois Halington, the executive director, can suggest ways to find agents.
Charles S. Suritz
Senior Marketing Manager
National Sporting Goods Association
Mt. Prospect, Ill.* * *
Banks are frustrating Angella Lewis's start-up plans. She's "ready to run" with her mail-order women's apparel business, but local banks won't let her open an account to handle customers' credit-card orders (Credit Check, December 1990, [Article link]). Her problem, it turns out, isn't uncommon.* * *
We faced the same problems as Ms. Lewis. We run a mail-order company, which until recently was also located in Miami, and time and again we were told by banks that Miami is crawling with fly-by-night mail-order merchants and "credit-card gangsters." We couldn't afford the security deposit the banks required (about six months' charges), so we couldn't take Master Card or Visa orders. And Discover accepts only those companies that Master Card or Visa has already accepted. The only friendly credit card is American Express. Acceptance there was as simple as filling out a form and signing a contract. The charges are higher, but it's a start.
P.S. Dianne Inc.
Brookline, Mass.* * *
You Can Quote Us
Past mistakes with his personal credit are thwarting Greg Waugh's start-up plans. He's opened a small photography business, and he needs additional financing to upgrade his equipment and buy advertising. But banks will not lend him the money he needs (Cleaning the Slate, November 1990, [Article link]). One reader suggested that the answer was only two pages away.* * *
The answer to Mr. Waugh's problem appears in [ [Article link]] of the same issue that his letter is in! Inc.'s New Businesses column reports on a study that found "a number of entrepreneurs had run bridge businesses between leaving secure jobs and starting their real companies. The intermediary ventures required little financing and were used as cash cows."
Before he leaves his current job, Mr. Waugh should start small, making use of the equipment he has and taking only those jobs that he is able to handle. He then should invest all revenues back into his company. If Waugh has already given up his job, he can moonlight for his primary income. Perhaps he should consider teaching a photography course.
Out of Your Mind . . . and into the Marketplace
In February's Resources box concerning finding venture capital ([Article link]), we mentioned a booklet published by Ernst & Young, Preparing a Business Plan. Well, the firm has discontinued that booklet, but John Wiley & Sons recently released The Ernst & Young Guide to Raising Capital (349 pages, 1991, $14.95, 800-848-8298), which includes advice on what venture capitalists expect from your business plan. n