In 1850, 2 brothers set up a cotton trading company inAlabama. This soon expanding into trading other commodities and over the subsequent years the company was one of the first to trade in share issues.Continued growth in the 20^th Century saw the company emerge as one ofthe leading investment banks turning over $19.2 billion at its peak.

Following in the trend of other investment banks, thecompany invested in sub-prime mortgages – those of poor quality and high risk. Eventually all confidence in the investment banks disintegrated as it was unclear just how many high risk, poor quality loans were tied to each investment bank. The company, Lehman Brothers, which was over 150 years old, filed for bankruptcy in September 2008.

It can be argued that the failure of Lehman Brothers was due to an increased reliance on poor quality, high risk trading.

What significance does this have in the coach hire industry? Due to the current economic climate, more and more customers are requesting “cheap coach hire”.  Coaches are assets run by businesses – they have the associated running costs and overheads and in order for the coach operator to stay in business they have a minimum charge that they need to meet.  If customers insist on lower prices, the coach operators have less incentive to reinvest in quality vehicles,as well as maintaining high standards in their staff and drivers.  Coach operators employ hundreds including cleaners, maintenance staff as well as office staff all of which need wages paying.

With reduced investment comes poor quality vehicles and eventually business failure as the coach operator struggles to make ends meet. Perhaps it’s time for people to appreciate that quality of service needn’t come at a prohibitive cost and that by paying a fair price all parties can benefit in the long run.