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Three Reasons To Have A Plan

It’s never too early to have an aircraft analysis plan.

The US economic data is still mixed. There is no clear agreement on whether the US economy is in a recession. Keep in mind the perspective: a recession is when your neighbor is out of work and a depression is when you are out of work. For the general aviation turbine aircraft market- signs are becoming mixed about a recession.

AMSTAT lists turbine business aircraft for sale. Right now- its fleet report shows that 10.7% of the active fleet is being offered for sale. This indicates a balanced market - the number of buyers and sellers are in balance. A few months ago- it was definitely favoring the seller.

Of course- for individual models the market may be hot- or cold. In general- older aircraft are in a soft market while newer pre-owned are still selling well. Still- we see some cracks in the wall. The lower end of the turbine market is slowing. Large cabin business jets tend to always sell well: those with the money to afford them don't tend to suffer from normal business down-cycles as much as others. However- as of late even large cabin business jets are starting to take longer to sell. The number of global-range jets for sale used to be in the single digits and were selling before they were listed. Now there are a few more for sale and prices aren't as astronomic as even a few months ago.

It is too early to tell whether the ride will get as bumpy for turbine general aviation. But it is never too early to have an aircraft analysis plan. Pilots routinely train to handle all plausible emergencies. That way should something abnormal occur- the procedures to handle it are familiar. It is the same with the non-flying and financial end of aviation. You need to have a plan for the aviation operation in order to be ready for whatever changes may face your operation.

A second reason to have a plan is that it’s easier to change a plan than to come up with a plan. No plan can address all contingencies. But if there is a plan in place for running and managing the aviation operation- changes in mission- changes in allocating costs- reduced budgets and other changes can all be evaluated against the current plan. This makes for a choice between adjusting a process versus hitting a crisis.

A third reason to have a plan is that it gives you guide posts and measurement criteria to measure how you are doing. While a 'thumbs up' from the CEO is a great measurement- aircraft availability- fuel cost per gallon- and actual-versus-budget are all important measures. It also gives you the data to measure small changes before they become major ones.

One operator we worked with was directed to look at getting rid of one aircraft while still meeting their demand with the remaining two. Fortunately- we had done an aviation needs analysis for them a few years prior.

We worked with them to update their plan to account for two versus three aircraft. We helped the aviation manager show the effect of having two on their operations- their costs- and their mission effectiveness. We also had them tracking costs by tail number so when the command was given to sell one aircraft- they could keep the two aircraft with the lowest projected overall costs and thus- have a better shot of meeting their new- lower budget.

All of this could have been done without a plan- but having a plan to refer to allowed them to do this in an orderly fashion of urgency versus one of panic.

David Wyndham is an owner of Conklin & de Decker. The mission of Conklin & de Decker is to furnish the general aviation industry with objective and impartial information in the form of professionally developed and supported products and services- enabling its clients to make more informed decisions when dealing with the purchase and operation of aircraft. With over 1-800 clients in 90 countries around the world- Conklin & de Decker combines aviation experience with proven business practices.

More information from www.conklindd.com; Tel: +1 508 255 5975

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