–Treasure from Trash–
The only conceivable way to solve a problem in any environment is to first know that you have a problem.
In the fast-paced world of business aviation there is a deep-rooted problem, a problem no one has ever even addressed, much less fixed. Not knowing that there is a problem, or how to remedy that exact problem has effectively hamstrung the entire revenue component of business aviation since 1962. Why those in the business aviation environment have never believed, or understood they had a problem has always been a mystery to me.
Going back to the beginning for me, it went something like this. After getting all my ratings, I did my flight instructor bit in ‘66 and ‘67 out of Cuyahoga County Airport CGF. Then after that I took on the rookie building time task of hauling checks for National City Bank Cleveland 6 nights a week (out of BLK) for all of ‘68…An unexpected result surfaced. In early ‘69 I personally was contacted by the Federal Reserve Bank wanting to know if I could do for them what I had been doing for National City. My great feat was delivering checks on time 99.75% of the time to the east coast where they have actual real weather, Personally I just thought it was part of the job. At any rate and unbeknownst to me at the time, the FRB tracked everyone that flew cancelled checks for them, and I seemed to have gotten the FRB’s attention. What they wanted to know was if I could do for them what I had been doing for National City. So, I took it on, and in a few months that became MidWest Air Charter, and yes that included National City Bank.
I left MidWest in ‘76 to be the CP for Benz North America, and MidWest changed its name to Airborne…today it is known as DHL. I left Benz in late 88/89 to create and co-found Jet Support Services Inc., aka JSSI. I only tell that story, so you know why I did not work to change the broken revenue charter business years ago; I was doing some other things all of which worked out pretty well.
Back to the problem at hand, seeking to take the clearly broken revenue charter system and make it work. I am taking this up for one simple reason; under the mountains of trash that currently is business aviation, there is gold in them thar hills, and I know how to get it.
There clearly is a solution to earning billions of dollars in revenue aviation, but that requires fixing the problem no one in business in aviation knows they have. This is a problem based on a single word. The significance of that single word is the difference between calling losses “write offs” (aka profits today) and making actual money in revenue aviation.
Yes, it is possible to make a fortune in business aviation. It is just not likely without making the changes necessary. Business aviation is a 200-billion-dollar industry capable of doing multiples of that amount annually. But rarely, if ever, is revenue aviation profitable which explains Felix Dennis’s pronouncement that if it “flies, floats, or fornicates, rent it”.
At no time do any of the current whack-a-doddle charter and revenue systems talk like, act like, or perform like making money is of any remote interest to them.
They all have a plan based on someone else’s plan that is based on someone else’s plan etc., without ever knowing if the first plan in the chain ever worked. Obviously, it did not! That got the business to the going-along-to-get-along plan (copying), and that only works if the first plan in the daisy chain works.
Anyone with money is capable of being in the business of business aviation. How they got their money sets the tone for success. Way too many inherited it, one or two may have won the lottery, or fell headfirst into the Lost Dutchman Mine. However, they got their money, most of them never bother to learn much if anything about the art form of revenue aviation. My golden rule is that if anyone wants to be in the business aviation environment, well actually anywhere in the business, you mut have been a successful chief pilot somewhere or you do not know anything about how aviation functions…I see that a lot in the FAA.
Some in sales and maintenance do simply fine, but they are not operating aircraft to make a profit…so once you get past support and or product services and get into trying to profit from operations it all turns to Merde (that is a French word – look it up if you really need to know).
However current operators got their funding, one thing is for sure; if they are operating aircraft in what is laughably known as traditional methods, then it is not working. I can state that as a fact because it is a fact.
The number one issue not addressed in any former or current business aviation models, is operations (that is not the word by the way). If anyone in/owing a business aviation that has never flown or operated aircraft extensively or been hired to run a multi jet operation, then they do not understand the word variables (that is not the word either), or what role variables play in day-to-day operations.
To start with, there are just too many variables, too many requirements, regulations, and situations that are not addressed or understood in any form for the business of business aviation to ever be profitable as it is now established.
The prime directive in the business of business aviation should be that you either innovate or you stagnate. Currently, we are in the 60th year of stagnation. And yet, no one has ever questioned why business aviation always fails or is used for tax write offs instead of making profits. The answer, however, is always the same; people that have little to zero experience in the complex world of aviation who think they really know aviation or think that aviation is just another business. Well, they are full Dunning-Kruger.
I can say that for one simple reason. It is true. In the real world of aviation, specifically in flying; if as a PIC, you screw up, you wind up a smoking hole in the ground. In the business of business aviation, if they screw up, they do not get killed, no they go to lunch with their accountant or investor and work out how to write off the last failed deal. And of course, how to do it again, make the same mistakes again and go to another lunch.
So, to the individual owning an aviation business, losing money is no big deal, just another day in paradise playing with shiny objects. That happens because everything that the owner screws up become write offs. It is not as dramatic as a crash and burn scenario, and no one dies, but ultimately that business of business aviation businesses always ends with the same result. Failure!
None of this is esoteric or avant-garde. There is no secret. Knowing what you are doing in the aviation business is the prerequisite to being profitable. The difference between success and failure is knowledge. Real useable knowledge. It is not about what someone said or thinks, it all comes down to what you know, and a lot of bona fide experience helps more than you can ever know.
Should you be interested in what that word is, and maybe see a little demo on why that word makes all the difference between success and failure, and worth billions in actual profits for all concerned, contact me at rick.eriksen@cox.net
