Fixed base operator business plan
About aviation & fbo business – written by joseph full title as submitted should be “what is a fixed base operation? Joseph had asked rod and myself what the fbo business was about, the good/bad/ugly about starting or operating a fixed base operation. Since this is something that he would like to be involved with in the future, the answer obviously is to outline the fact that aviation will eat your lunch faster than any other business, and you better know what the hell you are doing. If you can’t satisfy the requirements for a lot of capital, and a lot of professional and proven business principles, you may as well take your hard cash and throw it into the bbq pit, as at least you won’t have any money in the end, but without the stress involved with trying to figure this gig this is the most difficult point to be made as an aviation consultant, because if you sit down and make a realistic assessment of an aviation venture, and you are not bringing the pie in the sky image, you are considered someone who is not friendly toward general aviation, when in actual truth, you are trying to make general aviation work. Smart money knows what we are talking about in this article, the fakers don’t want anything to do with the reality of this business, and often end up paying the price themselves. Aviation needs more professional and business oriented understanding of how to build a fbo so that it is profitable, sustainable, and has an opportunity to succeed. Dictionary reference or description of an fbo can be found in wikipedia as follows: “a fixed-base operator (fbo) is a commercial business granted the right by an airport to operate on the airport and provide aeronautical services such as fueling, hangaring, tie-down and parking, aircraft rental, aircraft maintenance, flight instruction, etc. In common practice, an fbo is a primary provider of support services to general aviation operators at a public-use airport either located on airport leasehold property or, in rare cases, adjacent to airport leasehold property as a through the fence operation. Most fbo operators doing business at airports of high to moderate traffic volume are non-governmental organizations, i. These traveling aviators offered airplane rides, aerobatic flight demonstrations, and frequently collaborated as “flying circuses” and performed impromptu air shows for the townsfolk, charging whatever the local economic conditions would allow. As a result, mechanics and early flight instructors moved around with the aircraft and had no established business in any one location. The pilots and mechanics who made their living on the road began establishing permanent businesses, termed fixed-base operations at the growing number of airports appearing throughout the united states as a way to distinguish permanent businesses from the transient businesses common prior to 1926. The corporate jet movement of the late 60’s and early 70’s brought about a rapid change in the fbo’s traditional business form.
Fbo business plan
Most fbo’s, whether based in higher density areas such as metro ny/nj, la, dallas-fort worth, or chicago, or smaller cities like sioux falls, sd, allentown, pa or portland , me, where labeled as a “full service” fbo. These operators offered the usual “menu” of services; flight training, maintenance, aircraft sales, fueling and storage. But “big business” saw an opportunity in the fueling game; they knew corporate jets used up a great deal of this fuel, “jet-a” as it is known to aviation professionals alike! These roi (return on investment) minded businessmen were not aviation romantics nor in any way enamored with airplanes per se; they were, however, visionaries; simply a case of “number$”, big number$! Beck went on to say that, “management soon realized that the flight school department was a high risk low return” profit center1, and rather than one they would keep, was shaded to allow all their focus on a top quality customer driven re-refueling service to this “high end” jet owner and operator. Explains that this is how fueling businesses started and the other components were sold, such as flight schools and maintenance components. Is it because profit is the leading driving force or because there are not enough aviation/business minded individuals capable of managing all components of general aviation services? Part of my long term goal of one day owning and operating my own fbo, i sought out professionals in the business of aviation marketing and consulting to assist me in this fact finding mission. Finding the right people to get into business with can be difficult at most (if you are not financially capable of the startup capital on your own). Too often we have people who get into the aviation business by paying way too much for an existing business, or start a business without any real direction. Requires you to understand the demographics for the region, which includes income level, business users, etc, that aren’t often thought about until it is too late. I am not sure during your studies if you did much research into current fbo operators, but most don’t stay in business very long because there may be some pent up demand, but that is quickly satisfied and it is all downhill from beck stated the following on may 15, 2012: “after much independent research study and the equivalent of a doctorate thesis in business, i have concluded that: 1. Business or financially motivated and oriented people are rarely in any aspect of the recreational segment of ga.
On the other hand, the investment minded gravitate towards aviation ventures with maximum return on investment/equity (roi/e) and minimal risk, hence the upscale fbo enterprise rather than the higher risk of any business aspect of the recreational areas of ga. Aviation requires a certain amount of thought, study, business analysis, proper infrastructure, capital, and demand for the product before it is able to work. No matter how good the customer service level is, and the camaraderie at the airport, the fact is if you don’t have enough customers, the business will not work. Included other helpful insights in starting an fbo by considering the long term goals of the fbo to include growth in the planning stages instead of in hindsight. Having enough runway length should always be a consideration, and you have to think down the road on this one because having a corporate airplane on the field means good business. Once you have the runway length, an ifr approach, the door is open to making the airport available to larger airplanes and corporate operators that will hopefully base the airplane on the airport. A final note, rod beck offered a major error an individual fbo owner/operator can make in the ga business. One sin that is perpetually overdone in the aviation business, is not understanding how an airport can maximize its potential to serve the public, as well as the aviation community. All too often we try to plug in a business or the advice of someone who has limited experience conducting business, but has a passion for aviation. More often than not, the best solution is to step up to the plate and have someone who is a big picture aviation business development type, that so happens to have an interest in short term solution has always been to install an operator who is a great craftsman (a&p mechanic) and has a client base for maintenance. The problem is that the airport never develops a stronger client base, and sees the potential of the airport by understanding hanger lease opportunities, the long term income derived from airplanes that can have the owners enticed to basing the airplane on your airport, and that knows a realistic demand for aviation and how best to get there. Varies from one business to another and is increasingly less common to find a “full service” fbo. However, to offer a full definition of services the following excerpt or definition is provided by wikipedia: “fixed-base operators support a wide range of aeronautical activities which may include one or more of the following: sale of aviation fuel – piston aircraft fuel (100ll or avgas) and/or turbine aircraft fuel (jet-a or jet a-1), line services for general aviation aircraft, air taxi and air charter operations, scheduled or nonscheduled air carrier services & support service, pilot training, aircraft rental and sightseeing, aircraft sales and service, aircraft storage (tie-down or hangar), repair and maintenance of aircraft, sale of aircraft parts, aerial photography, crop dusting / aerial application, aerial advertising and surveying.
Though not required, fixed-base operators generally also provide at least basic auxiliary services to pilots, flight crew and passengers such as: restroom facilities, communication access (telephone, internet access, fax), and waiting areas. Larger and better equipped fixed-base operators may additionally offer food vending/restaurant facilities, ground transportation arrangement (car lending, taxi/limousine, shuttle van, on-site car rental), flight planning and weather information areas (computer or telephone based), pilot/crew rest lounges & showers, aviation supplies shop (selling navigation charts, manuals, or in-flight comfort items), access to in-flight catering, and accommodations reservations / concierge services for both crew and passengers through a customer services representative (csr). Otc bulletin board: pssr), a business intelligence software and solutions company, announced today that eastern aviation fuels has contracted for passur fbo fuel portal? Through its accurate flight tracking capabilities and useful marketing tools, passur will help our fbo network not only to manage its existing business better, but also to help it grow. The united states department of transportation in cooperation with the federal aviation administration has the duty of establishing minimum standards for commercial aeronautical activities and recommends implementation of these standards by the airport operator or agency (commonly referred to as the airport sponsor). The united states fbo industry is represented nationally by the national air transportation association or nata, but is also partly represented by both the national business aviation association (nbaa) and the aircraft owners and pilots association (aopa). Businesses meeting the minimum criteria as an fbo is 3,138 as of april 2009 according to a survey conducted by aviation resource group international (argi). 31, 2007, tsa launched, with industry partner signature flight support, the secure fixed base operator program (sfbop) at anchorage, alaska, shannon, ireland and le bourget, france. The program is a public-private sector partnership program that will allow fixed base operators (fbos) to check passenger and crew identification against manifests or electronic advance passenger information system (eapis) filings for positive identification of passengers and crew onboard general aviation aircraft. The broader application of such programs will provide robust security while maintaining operational flexibility for general aviation operators. The private charter standard security program is similar to the tfssp but adds additional requirements for aircraft operators using aircraft with a mtow of greater than 45,500 kg (100,309. The tsa secure fixed based operator program, “frequently asked questions” is a good resource in defining some of the regulations and requirements necessary to operate an fbo under this new program. At this year’s annual convention of the national air transportation association, part of the aviation industry expo super show, key discussions focused on undercurrents that have the potential to change the fixed base operator industry for years to come: airports potentially getting into the services sector at their facilities; the changing face of lease terms; and, the growing influence of outside money.
Infanger, 2005) the concept of new players entering an industry strictly from an investment standpoint – versus a love of it, per se, as is the history of fbos – has been a dominant part of american business for some time. Infanger reports that: “while this discussion was taking place, a proposal in congress was calling for a requirement that leaseholds on airports should be 75 years in length”, asks david bennett, director of safety and standards for faa’s office of airports, “if you’re an airport operator, why would you want to lose control over your property for 75 years? Peter clare of the carlyle group, an investment firm that has acquired piedmont-hawthorne and garrett, among various aviation interests, says a key reason outside investors are interest in the fbo market is due to the growth in business aviation. Information was particularly interesting to me as i consider the advice from the aviation marketing and business consultants rod beck and mike dempsey regarding outside investors. Will the lack of “business management” or too much passion verses profit allow for excessive turnover in the fbo industry, giving credit to the question topics mentioned at the nata convention? Another area of advancement and growth comes in the form of technology, such as the following news release announced at the conference: multi service corporation announces it has entered a strategic partnership with houston-based perfectstop, a new internet-based platform that directly links aircraft operators and fixed base operations (fbos). The aopa fbo rebate was launched in august 1997 to help cut the cost of flying for aopa members piloting under far part 91 for pleasure or personal business. Faa’s bennett and various fbos also stress the importance of minimum standards at an airport to ensure an equitable business environment. Such standards, they say, help maintain competition while helping to protect the investment of businesses already on the airfield. Paul meyers, principal in charge of denver-based aviation management consulting group, says that his firm is “not a big fan” of basing rates on gross receipts. He also cautions that, as fuel prices escalate in today’s uncertain market, a percent of fees rate could have a damaging effect on fixed base operators.? Legal battle in san diego provides an example of an fbo’s fight to stay in business and an airports, struggle with wanting more land for its own services in the following gibbs vs. Sand diego, 2005, case: the national air transportation association, which represents the interests of airport-based businesses, in a letter officially, expressed its concern to the san diego city council regarding the city’s refusal to renew the lease of gibbs flying service, a fixed base operator on montgomery field for 68 years.
We know the people that have always wanted to fly, would be able to find you in a basement if you offered an inexpensive learn to fly program. Having a “frequent flyer” means the aircraft utilization side will be ok, there may be enough demand to warrant another flight school airplane. In addition, you will always have spillover into a charter, and the opportunity to sell the client an airplane is right there in front of you, so make sure you take care of the customer at all times during flight training. It is my understanding that most paint shops are booked up and are doing steady business, and this is one area that if you don’t have a big demographic population in the area, and insist on an aviation business, this option may be the best way to make a respectable income. Beck provided me with an example from albany municipal airport business analysis for the pro’s and con’s of a particular fbo. It may be prudent for all fbo owners/operators to set aside some capital for aviation consultants to assist in analyzing their current operations and offering a pro’s and con’s list as recommendations or long term goals for the success of the fbo in the future. It is obvious to point out that without customers, there is no aviation “business” to profit from or to provide services to, but one particular fbo is making a statement about the importance of happy, satisfied customers who will provide free marketing opportunities for the fbo by word of mouth advertising for their newest service provided. Bill moltenbrey of business jet center (bjc) at dallas love field has added one more job to his growing list of duties, cleaning up after the fbo’s four-legged customers. In order to create a profit margin for this flight club a plan to offer private charters 35 hours of flight time was established. If any of the flight club members are also pilots, they can pilot these private charters and earn additional flight time each breaking down the monthly flight hours available with an average of 65 flight hours it was determined that a maintenance plan and a licensed a&p mechanic will be required to service the aircraft for an average of 16 hours a month. With the addition of more aircrafts, the club can expand its own members to more flight hours per month and purchase larger planes with larger seating capacities to continue to increase its profits during private the same communication from rod beck, he states, “for recreational aviation” to survive for the working/middle classes who feel that their being squeezed out due to shear economics, i. Mail communications from may 15 through may 18 2012, ved on may 15, 2012, website:Beck, rod, a short history of general on and marketing, october 13, 2010, website retrieved on , eastern aviation fuels contracts for passur(r) ons, february 9, 2011, prnewswire, ved on may 17, 2012, website:5 responses to “the fbo business – written by joseph lynch”. A copy of the lease the business growing, and what are the opportunities are big questions to any fbo acquisition.
If the income is on the downslide, you need to forecast that percentage for future income, although you may think you have a growth potential, you still have to think in terms of worst case any business acquisition – don’t overpay, as it will make your life miserable! 21st, 2017 at 6:41 your research and perspective making a lot of sense for thinking clearly with business perspective. Solutions | blog | about | by media dew an inexpensive web site design solutions about aviation & fbo business – written by joseph full title as submitted should be “what is a fixed base operation?
