You could not be more wrong.
Egregious FBO charges
- Thread starter dans2992
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midwestpa24
Final Approach
There are small communities that contract out the entire operation and management of the airport to an FBO, usually small family owned businesses. It saves the small community the cost of managing and maintaining the airport full time.
Signature, etc., is not providing airport management services.
There are also airports that the city/county/sponsor operate the FBO services directly. There are some that don't like such arrangements, as they see it as government competing with private business. However it is often found at airports where the FBO left, and there was nothing left to fill the void.
The FBO business is not as big and lucrative as you would imagine, outside of those in large metro area airports. Did you know the average profit margin for an FBO is 1.4%? Many of the small mom and pop type FBOs are slowing closing up and going away as the owners retire or pass away. There are small airports losing their operators completely, and no one looking to come in and replace them.
Signature, etc., is not providing airport management services.
There are also airports that the city/county/sponsor operate the FBO services directly. There are some that don't like such arrangements, as they see it as government competing with private business. However it is often found at airports where the FBO left, and there was nothing left to fill the void.
The FBO business is not as big and lucrative as you would imagine, outside of those in large metro area airports. Did you know the average profit margin for an FBO is 1.4%? Many of the small mom and pop type FBOs are slowing closing up and going away as the owners retire or pass away. There are small airports losing their operators completely, and no one looking to come in and replace them.
I can imagine that’s true and like it or not, I think it’s driven by progress that is slowly making their services unnecessary, as long as the airport itself continues to exist with self-serve fuel and parking. As mentioned earlier, restaurant leaseholders are in my view more likely candidates to succeed as businesses because they can draw from the local community as well as the pilots who may no longer need most of what an FBO offers.
Obviously hangars are in short supply and high demand, so there’s business there too if the land lease terms are acceptable. But I think onsite FBO staff serving owner flown light aircraft are becoming obsolete. Just my observation.
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midwestpa24
Final Approach
FBOs are not just gas stations. They usually provide multiple services, including maintenance, rental, and instruction. Fuel is just a small part of the business model. Self serve isn't going to replace those other services. We already complain how hard it is to find an A&P that isn't booked months out. That isn't getting better.
yep. That’s why blackstone is buying up all these fbos. Your observation vs blackstone - pretty sure it’s obvious who is more successful, like way more successful.
Clip4
Touchdown! Greaser!
As usual, you are clueless.
| DATE: | 05/20/1986 |
|---|---|
| ORGANIZATION: | State Ethics Commission |
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If there is demand for FBO services at a price people are interested in paying, then they will survive by selling these services. You yourself are saying they are closing and nobody is interested in the business, except where there are big fish to fry - jets etc with a ridiculous cost structure from the individual ownership POV. There’s not much more to say.
The maintenance business seems to me to be bifurcating, like the airport service business in general. There is certainly a fraction of people who want a full service ‘bring your credit card’ maintenance shop, Cirrus owners etc, just as there are the fancy FBOs that charge egregiously for parking but can very often be avoided. Meanwhile as certified aircraft owners at grassroots level watch the RV crowd do their own thing, I think more and more are using independent A&Ps with low overhead and doing more of the work themselves under supervision, sometimes in their own hangars. All this stuff is just the market looking for efficiency, and moving towards it when possible. I have a very nice relationship with a local A&P IA along those lines and it’s cut my costs to the bone, while increasing quality because I’m quite fussy and unlike he know how to get parts for my unusual airframe. He works with each customer based on that customer’s needs and skill level, spreading himself over a lot of planes but making a healthy living in doing so. Good teamwork, with lower cost to the owner than a traditional FBO. I think in the end, the more complex types that require more maintenance than can be done by that setup, and which aren’t typically owned by bucks-up owners are going to be unsupported by reasonably priced maintenance and generally fall by the wayside. Training organizations will hire their own A&Ps to cut out the FBO profit.
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Gilbert Buettner
Cleared for Takeoff
Far and away the largest part of my FBO's profit comes from pumping jet fuel for transients and five corporate airplanes based here.
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Vintage Snazzy (so my adult children say)
As much as I use and appreciate small town airport FBO's, I have no idea how they make enough for it to be worthwhile.
Perhaps in a small town whatever they make is competitive compared to whatever else small business they could run (local plumbing shop, electrician, trucking, etc.)
Perhaps in a small town whatever they make is competitive compared to whatever else small business they could run (local plumbing shop, electrician, trucking, etc.)
