AC Management Nov14_Gil WolinNov06 20/10/2014 15:55 Page 2
...the decision to go with a management company, and the expectations of the benefits should be the focus of the company's process of shopping and selecting a firm to manage its aircraft.
aviation deficiencies. Everything had looked so much simpler at the time of purchase: Buy the airplane, employ someone who could fly it as part of the job, and fly forth into success! Simple? It might have been if that’s all that there was to it. Except it wasn’t… Crew hiring; training and qualifying; meeting insurance requirements; finding a suitable maintenance “home” for the jet; and something else… those “third-party revenue” opportunities that the broker had spoken of. All added to the complexity of the equation. None of the partners seemed interested in starting a second entity to own and operate the airplane and meet the Part 135 requirements for offering charter flying. So outside Advertising Enquiries see Page 9
135, how does a company realize those possibilities? The company's use plan, predicated on flying just 250 hours annually, left a window to fly the airplane another 250 while staying within the scope of normal business aircraft flying averages. It was at this point that our business manager charged with overseeing his company's newly purchased pre-owned jet first heard about companies that manage what he was finding unmanageable. Some months after enlisting his company's airplane with a Management company, he offered this insight to anyone who has to share their work time with their main job and serving as a de facto aircraft-operations provider: “Find a management company to take the airplane off your hands so you can do the jobs you bought the airplane to achieve. With the appropriate balance of in-house and outside use, a management firm may even enable that airplane to become a money maker in its own right. Instead of being viewed as a cost – which can vary wildly from company to company – aircraft management is more regularly viewed as an alternative to the costs of directly managing the aircraft. That means the costs are often offset by the benefits of the management program – and by freeing a company executive from time not productive for the company's primary line of business. But as with so much of Business Aviation, the decision to go with a management company, and the expectations of the benefits should be the focus of the company's process of shopping and selecting a firm to manage its aircraft.
EXPERTISE, TIME, TROUBLE FREE Aircraft management companies exist in many varieties, scattered across a broad swath of locations. They vary in their approach, clientele, base location and aircraft selection. But they all serve a fundamental mission with common traits: To manage a www.AVBUYER.com
client's aircraft to afford them maximum availability of their own plane, while keeping the airplane busy enough – via charter to help it earn its salt. Ultimately, the management company does just what the name implies: It manages the aircraft for the owner. It takes care of supplying crew – cockpit and cabin – and depending on the agreement with the client, not only operates the aircraft for the owner but flies it in revenue-generating operations for third-party clients. Aircraft owners may decide to tap the expertise of a management company after acquiring the aircraft, or after a change in the owner-company's needs and use patterns. Many management companies offer what are commonly called “turnkey management solutions” that might start before the aircraft owner purchases the aircraft – or as far back as before a company selects and acquires the aircraft. In place of paying several vendors and crew, the company with the managed aircraft pays one bill that covers everything. And when placing the managed aircraft on the management company's charter certificate is an option, the benefits can range from simple cost reductions to outright profitability from the aircraft's third-party use. How much, of course, will vary, depending on the hours the jet is made available, the size of the aircraft and the market.
A PERSONAL TOUCH? No two mission requirements from one company to another will be exactly the same when it comes to ownership of a business aircraft. So the need for flexible, customizable programs to suit an individual client’s need is an absolute necessary where aircraft management is concerned. As an example, the team at Meridian Air Charter (www.meridian.aero), based at Teterborough, New Jersey, but with several satellite offices dotted around the United States, emphasizes the individuality of its ❯ November 2014 – AVBUYER MAGAZINE
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