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Financial Benchmarking for NATA Members a Guide to FBO Accounting Software the VLJ’S Future in Charter

Financial Benchmarking for NATA Members a Guide to FBO Accounting Software the VLJ’S Future in Charter

3rd Quarter 2006

Financial Benchmarking for NATA Members A Guide to FBO Accounting Software The VLJ’s Future in Charter

PRESORT Standard Also Inside U.S. Postage PAID Silver Spring, MD • The Continuing Threat of Permit No. 1400 Aircraft Misfueling • Opportunity Finder: Castle Air • Making Your Business Fly in Cyberspace

Aviation Business Journal Official Publication of the National Air Transportation Association Voted #1 Fuel Brand Chairman of the Board President Bill Koch James K. Coyne SevenBar Enterprises NATA Dallas, Tex. Alexandria, Va.

Vice Chairman Treasurer Reed Pigman, Jr. Dean Harton Texas Jet, Inc. Landmark Aviation Fort Worth, Tex. N. Charleston, S.C.

Immediate Past Chairman Chairman Emeritus Sally A. Leible Greg Arnold Airport Terminal Services, Inc. TAC Air St. Louis, Mo. Texarkana, Tex.

Board of Directors Dale Froehlich John Lotz Business Aviation Services Monterey Bay Aviation ® Sioux Falls, S.Dak. Monterey, Calif.

Michael Grossmann James Spinder Castle Aviation Inc. Atlantic Aero, Inc. North Canton, Ohio Greensboro, N.C.

Dennis Keith Theo Staub Jet Solutions LLC Jet Aviation Holdings, Inc. Richardson, Tex. Teterboro, N.J.

Publisher Art Direction/Design James K. Coyne Tim Wagner

Editor Advertising Manager David W. Almy Cheryl Stratos Contributing Editors BECAUSE... Michael Ancell Kelly Creamer

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AVIATION IS OUR ONLY The VLJ’s Future in Charter: The $1.4 Million Question By Lindsey McFarren 13 BUSINESS AND WE UNDERSTAND Some on-demand air charter companies see the new very light jets not as a luxury toy for speed-hungry private ITS UNIQUE REQUIREMENTS. pilots, but as an opportunity to create an entirely new market of on-demand air charter customers. Member Profile: Castle Air By David W. Almy 18 Like many entrepreneurs, charter operator Michael • WE MAKE IT OUR RESPONSIBILI- Grossmann has adapted to the times—and they have been a-changin’ hourly, it often seems—to find his next great TY TO BRING BUSINESS TO FBOS business opportunity. FBO Accounting Products Move Beyond Bookkeeping By Paul Seidenman and David Spanovich 25 • WE LISTEN AND RESPOND This article explores accounting software products designed specifically for FBO applications, including a TO INDUSTRY ISSUES AND look at offerings from six major vendors. CONCERNS The Continuing Threat of Aircraft Misfueling By Mike G. Mooney 35 Delivering the incorrect grade of fuel into an aircraft can • WE DON’T WAIT FOR CHANGE, have disastrous consequences, but by working together to ensure that appropriate preventative measures are WE ANTICIPATE IT AND TAKE followed, we can help stop aircraft misfueling altogether. ACTION NATA Announces New Financial Benchmarking Service NATA now offers its members access to up-to-date 54 financial trends and benchmarking analysis for the aviation industry to help them make more informed business decisions. WE WORK DILIGENTLY TO President’s Message | By James K. Coyne 7 BE THE MOST PROGRESSIVE AND Inside Washington | By Eric R. Byer 10 INNOVATIVE FUEL SUPPLIER Making Your Business Fly in Cyberspace | By Dan Kidder IN AVIATION TODAY. 42 The Biggest Myth in Aviation? | By Russell Lawton 49 Safety Watch 51 ® New NATA Members 57 Advertiser Index 800-521-4106 www.avfuel.com 58 TM

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Aviation Security Gets Down to Business By James K. Coyne, President The dramatic clampdown on air travel security philosopher will try to procedures this past summer, prompted by the dis- clarify the whole mess Tcovery of a sophisticated terrorist plot to detonate by recalling the research liquid explosives in several transatlantic airliners, of Abraham Maslow and has once again forced air transportation provid- his famous 1943 paper, A ers and service companies to review their secu- Theory of Human Motiva- rity procedures. Many of us are asking ourselves: tion, where he explained “Am I meeting all the latest security regulations?” how people seek to sat- But maybe the real questions to ask are: “How isfy successively “higher is aviation security part of the optimum product needs” in a hierarchy. or service my customers want from me?” and “Is Once they are “satisfied” with their physiological security just one of my costs or has it now become needs, they move up to a higher level where their an essential part of the process that produces my greatest “needs” are physical safety, security, and revenue and profit?” freedom from threats. People can’t help themselves, To many of us, aviation security is an example of Maslow proclaimed, because their “need” for secu- good intentions run amok. After 9/11 it was under- rity is as real and commanding as their “need” for standable that aviation became the focus of new bread and water. regulations, but five years later it’s hard to under- So where does that leave us? Simply put, secu- stand why aviation gets all the attention and other rity is here to stay, and it will expand its scope transportation modes have almost been ignored. and presence throughout all elements of aviation In any case, most aviation security professionals for decades to come. This is, by far, the greatest feel confident that with hardened cockpit doors change in aviation in the past decade. Forget about and airline passengers who now understand what new planes, engines, FBO terminals, fractional terrorism means, the chance of another 9/11-type programs, low-cost carriers, and even higher gas hijacking is almost zero. But though we are all loyal prices. Nothing is reshaping the nature of aviation soldiers in the battle against militant extremists, the products, services, and demand more than aviation continued emphasis on aviation security reminds security—because it has fundamentally changed me of the old saying about how generals are always what people think about and what they want when fighting the last war and miss the unexamined they fly. threats or untried tactics in other arenas. Thus, the Of course, not all people are the same. They vary latest official assessment of how frightened airline economically, socially, geographically, culturally, passengers should be has been moved up another and in many other ways, but when it comes to notch. It’s now 9/11/06, and we can’t even bring a air transportation they all are concerned with the bottle of water on a commercial plane! Is this the same four fundamentals: price, safety, speed, and last straw—or are the skies forever changed? convenience/comfort. It is here that the impact To answer this question you probably need to talk of security is so obvious because it directly affects to a pollster, a politician, and a philosopher. The each of these primary factors. Security costs make pollster will tell you that the public is afraid and travel more expensive. Security procedures raise generally accepts with little complaint whatever public consciousness about safety and frighten the measures government imposes to reduce the risk of fearful. Security protocols not only increase travel a terrorist attack. The politician will tell you that no time portal-to-portal, but they heighten the risk of one gets elected anymore with the line, “We have flight cancellation, adding an uncertainty factor nothing to fear but fear itself.” American politicians that makes flight scheduling more problematic. And these days wave a banner that says, “Better safe perhaps most dramatically, security requirements than sorry,” and even conservatives can be drunken make air travel, at least on scheduled airlines, far sailors when it comes to security spending. The Continued on page 8

Aviation Business Journal | 3rd Quarter 2006 7 President’s Message Continued from page 7

less convenient and comfortable. of our business, so are our customers gradually No matter what aviation product or service appreciating that this is something they have (and you sell, the rules are now changed because your should want) to pay for. And if there is any lesson particular offering has become more or less attrac- to be learned from 9/11, it is that security costs tive (hopefully more) to customers whose normal shouldn’t be absorbed, without compensation, by a air transportation choices have been transformed service provider. Prior to 9/11, the airlines handled by the new security regime. Whether you handle passenger screening that way and ended up driv- cargo, fuel business jets, load bags, manage aircraft, ing screener standards to the “cheapest” level they offer on-demand charter, clean aircraft, train pilots, could get. Good security, like anything else, costs sell support equipment, install interiors, overhaul good money. engines, or operate a fleet of fractional aircraft, you The way you manage and sell the security part are now selling something that raises (or answers) of your product or service, of course, depends questions about aviation security and has costs di- on what your customers want and need. Maslow rectly associated with your “management” of these teaches us that the higher up the economic ladder questions. Whether you ever thought about it be- your customer is, the greater his “need” for safety fore or not, you’re in the aviation security business and security and therefore the greater his interest now—big-time! in how your product/service meets his security re- So you’ve found yourself another business to quirements—and the greater his willingness to pay run. Just what you need. “Thanks a lot,” I hear for it. A charter customer, for example, is aware of from some of my more sarcastic friends. But for the risks of flying in a large airliner with hundreds many of you, this may be the most important (and of anonymous passengers, but he should also know certainly the most serious) business opportunity about what you do to protect his security when he’s to come your way in a long time. Just as we’ve flying in your aircraft. Your ground security, back- had to gradually realize that security is a big part ground check, and screening procedures give him even more reasons to value private aviation, along with the more obvious time-saving, hassle-free, schedule-reliability benefits of on-demand charter. There is also an opportunity for NATA members, PT6 Fuel Nozzles because of their familiarity with aviation opera- tions in all environments, to identify important new security products or services. Cargo handlers, Recertification, for example, can far more easily and effectively implement meaningful security procedures for Exchange Kits, cargo loaded onto commercial aircraft than could a disparate group of shippers or carriers. Domestic Including Duplex flight schools are far more capable than an army of customs and immigration bureaucrats to create se- curity procedures that insure that only serious (and ■ Exchange kits in stock for most safe) students graduate from their programs. FBOs engine models are often the only ones with employees at a small airport 24 hours a day. Airport operators should ■ 24 hour turntime on turn to them to fulfill (and be paid for) the impor- customer nozzles tant security functions they can provide. Meeting the security challenges we face has ■ Highly competitive changed aviation forever, and the aviation service pricing businesses that change to make security a part of their business will not only make our skies, air- ports, and cities safer, they will also find new cus- 630 Barnstable Rd/Hyannis Airport tomers, new revenues, new profits, and new paths Hyannis, Massachusetts 02601 for growth and expansion. Our customers, undeni- Phone: 508/771-4744 Fax: 508/790-0038 ably, have an enduring “need” for security. So, too, FAA CRS UE5R246N, EASA.145.4786 do we have a “need” to meet that need, giving our www.prime-turbines.com customers much more than mere security—giving email: [email protected] them, in the final analysis, the freedom to live and travel without fear. To me, that’s priceless.

8 Aviation Business Journal | 3rd Quarter 2006

Aviation Business Journal 1/4 page Fuel Nozzles ad Duotone

INSIDE WASHINGTON

Five Years Later: For Better or For Worse? By Eric R. Byer, Vice President, Government and Industry Affairs

As I prepared to write this column, I realized that and oversight. we would soon be observing the fifth anniversary • The White House of the September 11 terrorist attacks. So much has A proposes, and Congress happened with aviation security since that horrific approves, the merger of day that I decided I would briefly review the major key domestic security changes and include a short scorecard on the suc- agencies into the new cess or failure of each. Department of Home- • The Federal Aviation Administration (FAA), land Security (DHS). which was responsible for overseeing aviation The TSA, Customs, security prior to and shortly after the attacks, Secret Service, and INS are included under the loses jurisdiction of this important function to the DHS umbrella. newly created Transportation Security Adminis- This move was for the better, though none of tration (TSA). these agencies are still happy with the change. This was an action for the better. The TSA has be- Unfortunately, they far too often only begrudgingly come one of the more valuable and effective agen- work together. Only if these agencies truly embrace cies within the federal government. You can thank their combined existence will we achieve fulfill- constant public scrutiny and some truly outstand- ment of this promising and necessary initiative. ing personnel for this. They don’t always get it right • Aviation cargo security is addressed in the form (let’s face it, their learning curve has been pretty of a final rule issued earlier this summer. steep) and we don’t always agree with their actions, Does it really address cargo security, or is the rule but they have at all times and as much as possible an answer to political rancor among our friends on tried to involve NATA in the process with straight- Capitol Hill and in the media? Only time will tell forward and honest dialogue. about the success of this rule. The immediate ques- • Private screening companies bear the brunt of tion remains: When will we stop letting politics and criticism for failing to discover the weapons and propaganda rule the day when it comes to rulemak- ascertain the identities of the perpetrators of the ing content? This action was definitely a change for September 11 terrorist attacks. They are made the worse. the scapegoat and are put out of business, with • The TSA mandates security programs for on- the exception of the retention of private screen- demand operators using aircraft weighing more ing services at five pilot-program airports. After than 12,500 pounds, and while there are some several reviews, it has been determined that significant initial hurdles, the air charter industry there is no measurable difference in performance responds well to the program. between the government and the private sector The benefit for the industry has been the ac- on screening. We now have tens of thousands of quired ability to assure the public that our aircraft trained TSA officials at our busiest airports con- are secure, that passengers are being vetted, and ducting these screening functions. that all reasonable measures are being taken to This was for the worse. The screeners were not ensure security. This was achieved with a program the problem. It was instead our government and that, thus far, has been at least manageable for in- the standards that it set. Private screening compa- dustry. This was a change for the better. nies, many of them small businesses, paid the price • The TSA establishes the Alien Flight Training/ for our government’s poorly developed standards Citizenship Validation Rule. This rule applies to

10 Aviation Business Journal | 3rd Quarter 2006 flight training for recreational pilot, sport pilot, rorist act that has already taken place rather than private pilot, instrument rating, or multi-engine spending the time on proactive steps to address rating training. U.S. citizens must prove citizen- likely potential threats. The fact is, though, the ship through a birth certificate, passport, or other politicians should not be making the decisions. I am official document. Flight training centers wishing IS ad forhopeful output that the7/12/05 success 1:21 in GreatPM PageBritain 1 indicates a to instruct alien students must register with the turn finally toward being proactive rather than ful- TSA, students must apply with the TSA before filling silly political requests that are pure window beginning training, and flight schools must keep dressing. detailed records of alien flight training. Initially, the rule reads that every pilot, even a U.S. citizen seeking a flight review or other recurrent train- ing, and every flight school would be subject to the alien student requirements. The rule also re- Investigative & Background quires all flight instructors and schools to register Information Services with their local FSDO, a task the under-resourced, SPECIALIZING IN THE AVIATION INDUSTRY “overworked” FAA was not prepared for—or was • Criminal Record Search • Prior Employment Verification even aware existed! In the end, the debacle is •Social Security Number Verification •Pilot’s License Verification sorted out: U.S. citizens taking some form of •MVR (Driving Records History) • DOT Drug Screening “substantial” training have to prove citizenship, PACKAGE PRICING AVAILABLE and U.S. citizens taking recurrent training do not. Fast,Reliable & Economical Web Based System Only flight training centers instructing alien stu- Toll Free:866-666-7884 • Phone: 770-590-8837 • Fax:770-429-1345 dents must be registered with TSA, and only alien [email protected] • www.intersearchinc.net • P.O.Box 4755,Marietta,GA 30061-4755 students must go through the application process. This action started as a change for the worse, then became one for the better (although far from perfect). While I support documentation of alien flight students, the process and recordkeeping requirements are so cumbersome that many of our member flight training centers just choose not to instruct foreign students, the vast majority of whom are law-abiding flight candidates with great potential.

A Remarkably Resilient Industry Since that horrific day, much has been done to im- prove security within our nation’s air transportation system—some good and a lot bad. Truly remark- able, after more than five years, is the resilience of the aviation industry. Aviation businesses take whatever government throws their way and man- age to make it work, make ends meet, and grow their business to boot. But equally remarkable is that politics continues to play far too large a role in the decision-making of how to address security needs, while the people with the expertise in foiling plots, including the one in Great Britain, are simply not having enough say. I know there is frustration from many out- standing public servants at DHS and within our government’s intelligence infrastructure who are required to be responsive to political pressure from the White House and Capitol Hill to address the ter-

Aviation Business Journal | 3rd Quarter 2006 11

The VLJ’s Future in Charter:

The $1.4 Million Question

By Lindsey McFarren

hen the concept of the very light jet (VLJ) miles, and a service ceiling of 41,000 feet. Eclipse emerged several years ago, aviation enthusi- Aviation boasts about the aircraft’s short landing asts considered the VLJ to be the next owner- distance that makes more than 10,000 U.S. airports Woperator “pocket rocket” aircraft. The fulfill- possible destinations for the Eclipse 500. Eclipse ment of general aviation pilots’ dreams of owning Aviation chose Pratt and Whitney PW 610F engines, and flying their own affordable jets at speeds remarkably quiet turbofans that exceed existing comparable to much larger jets while gaining access Stage 3 noise requirements and will meet upcoming to exotic locations too small for bigger aircraft was Stage 4 requirements. The engines are managed by on the horizon. But some on-demand air charter dual-channel full authority digital engine control companies, including Delray Beach, Fla.-based (FADEC), which leads to greater fuel efficiency and DayJet Corporation and others, see the VLJ not as reduced pilot workload. The aircraft is also outfitted a luxury toy for speed-hungry private pilots, but as with Avio Total Aircraft Integration, a full-service an opportunity to create an entirely new market of systems management device that simplifies crew on-demand air charter customers. tasks and leads to reliability and safety through ef- Can the VLJ be a catalyst for growing the air char- ficient redundancy. ter industry? Will VLJs usher in a new era of “per- DayJet has decided to use the Eclipse 500 in a seat, on-demand” FAR 135 air transport options? unique per-seat, on-demand operation. The com- DayJet thinks so. With the right mix of aircraft, pany will sell seats on the plane much as airlines service, location, and customers, the company has do but will not operate on a schedule, which is developed an intricate and rather unique model for prohibited by DayJet’s Part 135 certificate. DayJet its VLJ operation. Vice President of Community and Government Affairs Traver Gruen-Kennedy said the company The DayJet Model considered using VLJs in a traditional air charter DayJet believes the recently certificated Eclipse model, whereby a customer charters an aircraft 500 is the right aircraft for the emerging VLJ on-de- and crew per flight under DayJet’s charter division mand air charter market. The company will receive brand Wingedfoot Services. But “our per-seat, on-de- 300 Eclipse 500 aircraft in its first two years of op- mand business model gives our customer a simple erations. The aircraft is amazingly affordable, with and easy way to book a seat to meet their personal a price tag of around $1.4 million, and has a maxi- scheduling needs, while our advanced system for mum speed of 370 knots, a range of 1125 nautical Continued on page 14

Aviation Business Journal | 3rd Quarter 2006 13 The VLJ’s Future in Charter Continued from page 13

real-time operations (ASTRO) faster than driving. machine returning “home” each enables us to quickly determine The focus group results led night. In addition to the amenities the cost of production for that DayJet to establish a regional of a DayPort, DayBases will have seat and efficiently manage our model including pre-determined crash, fire, and rescue service, sig- resources to create an itinerary airports served by DayJet, known nificant hangar space, and more and flight plan,” he said. as DayPorts. The typical DayPort sophisticated navigation devices. As the first regional VLJ opera- has no or limited access by com- Although DayJet’s model tor, DayJet anticipates it can bet- mercial airlines and is a short, includes customer service repre- ter manage fuel costs and main- few-hour flight from the DayPort sentatives at each DayPort, the tenance expense by creating a of departure. This regional model transportation itself is meant to permanent presence in secondary has targeted business travelers bridge the gap between the air markets, unlike its global charter who now waste several hours of chartering elite and the airline- operation. “By focusing on meet- driving time commuting from one flying public. “DayJet will offer ing business travelers’ needs in sales call or meeting to another utilitarian regional travel, with no the U.S. southeastern region, we or who fly commercial airlines catering, no in-flight services, and will achieve our goal of first-class through the inefficient hub-and- no frills,” Gruen-Kennedy said. customer service at a price point spoke system. The company an- DayJet has opted to crew each not achievable if we were to use a nounced this spring that it would flight of the single-pilot certifi- service primar- cated Eclipse 500 with two pilots, ily the Southeast based partially on the information As the first regional VLJ United States and gleaned from the focus groups. later announced “The two-man crew leads to safety operator, DayJet anticipates establishment of and redundancy that we think DayPorts in Boca makes a lot of sense, even though it can better manage fuel Raton, Gainesville, the aircraft is certificated for Lakeland, Pensaco- single-pilot operations,” Gruen- costs and maintenance la, and Tallahassee, Kennedy said. “The Eclipse 500 Fla. is a stable, reliable aircraft with expense by creating a DayJet’s regional excellent avionics that greatly sim- permanent presence in model consists of plify single-pilot operations, but three new terms our customer focus groups have secondary markets.... for the lingo-loving indicated a two-man crew means aviation com- more confidence for passengers.” munity: DayStop, DayJet is also committed to traditional charter approach.” DayPort, and DayBase. DayStops high-level, airline-like training, DayJet’s commitment to cus- meet the company’s minimum contracting with Eclipse and tomer service began with the com- operating requirements, including United Airlines for their training pany studying 20 focus groups. a hard surface runway of 3,500 program. “We are getting strong Safety, security, and customer feet or longer, secure perimeter, interest from highly qualified pi- service continuously ranked as runway lighting, and visible lots coming out of airlines that are the focus groups’ top priorities. signage from interstate to FBO downsizing and those that have In focus groups involving busi- terminal. DayStops, as the out- taken early retirement packages ness travelers, participants said posts of the DayJet frontier, will but like the aircraft, our training, they would pay a premium over provide the most basic services. and customer care approach,” non-restricted full coach airfares DayPorts upgrade the service of Gruen-Kennedy added. to avoid overnight costs and the a DayStop to include paved ramp DayJet, although the most vis- inconvenience of large airports space, a customer welcome desk ible operator in the coming VLJ and layovers. Participants told including many customer service world, is not the only on-demand DayJet that most of their regional options, Jet A fuel, oxygen and ni- air charter operator looking to the trips are driven, but that driving trogen services, and FBO person- VLJ to develop a new air charter is inefficient use of time and for nel for towing, fueling, and minor customer market. POGO, run by these kinds of trips conventional maintenance. DayBases will each former American Airlines Chief 121 air service with its security be headquarters for several pilots Executive Officer Robert Cran- and check-in lines is often no and aircraft, with both crew and Continued on page 16

14 Aviation Business Journal | 3rd Quarter 2006 233-80_JA_FBO_NATA 13.6.2006 15:06 Uhr Seite 1

AVITAT Network Members: Bedford, Dallas, Palm Beach, Teterboro The VLJ’s Future in Charter Continued from page 14

dall, plans to operate more than air charter industry as a whole. Of less concern to Milian is the 50 VLJs within its first two years “These aircraft have received fear that VLJs will decrease his of business. However, POGO will considerable media coverage as existing air charter customer pool. sell flights in a more traditional they developed, and an accident He’s fairly confident the typi- manner: by the flight, not the involving a chartered VLJ could cal VLJ charter customer of the seat. Price is expected to range negatively impact all of the char- future is today’s airline customer from $1 to $6 per mile. Linear Air ter industry,” he said. or possibly a small turbo-prop in Massachusetts intends to add 30 Milian’s concerns are rooted charter customer. His concern is Eclipse 500s to its existing Cessna in pilot qualifications and train- not the marketability of the VLJs Caravan fleet. The company’s ing, the aircrafts’ excellent per- but rather the operation of these existing fleet conducts some formance capabilities, and the aircraft in a very complex and regularly scheduled flights to Nan- environment in which VLJs will ever-changing operating environ- tucket and Martha’s Vineyard and be operated. Pilots with sub- ment by inexperienced pilots. also on-demand air charter flights. stantial flight hours typically That said, Milian wouldn’t be The Eclipse 500s already on order want to fly larger aircraft, not completely opposed to adding a will continue Linear’s scheduled “downgrade” from a larger jet to VLJ aircraft to his existing fleet in and traditional air charter hybrid a pocket rocket, although very the future. “If an owner of a VLJ model. well-equipped VLJ, so most VLJ asked my company to manage the pilots are likely to aircraft and use it for charter op- be recent upgrades erations, I would consider it,” he from turboprop or said. “In doing so, I would ensure “These airplanes will twin-engine piston that a properly trained and experi- certainly find a niche, but it aircraft. Some of enced two-pilot crew flies the air- these pilots will craft.” Milian questions, however, will be regional use and they have little experi- whether the market could support ence with high the additional crew and training will not likely be widely altitude operations costs associated with a two-pilot and RVSM air- crew. used in traditional charter space. Some traditional air charter Milian also wor- operators are even less optimistic, models.” ries about where and their skepticism lies not just —Dennis Keith these aircraft fit in the aircraft itself, but also in the in the scheme of per-seat, on-demand model being America’s airports. considered. “The idea that random But with all the focus groups “The airports likely to be used by people, unknown to each other, conducted, sophisticated aircraft VLJ aircraft can have runways as will have the same departure and on order, and planning completed, short as 3,000 to 4,000 feet,” he arrival city at the exact same time can DayJet and other similar said. “Primarily single-engine and is rather far-fetched,” said one air charter companies really change multi-engine piston aircraft use charter operator. “The result will the face of the air charter industry these airports today. Most of the be en-route stops to pick up or with the VLJ? Some traditional air operations are conducted VFR drop off other passengers, greatly charter operators are skeptical. without the benefits of a control reducing the time-savings ben- tower. How will these small jets efit of the per-seat, on-demand The Skeptics fit with the piston aircraft already model.” using those airports? More im- The VLJ’s cabin size and lack Traditional on-demand air charter portantly, how will these aircraft of amenities (read: lavatory) also operators vary in their views on operate in congested terminal have many traditional air charter the VLJ from guarded optimism to areas if flown single pilot? At is- operators shying away. The price all-out skepticism. sue is that, while these aircraft point and operating costs of VLJs Frank Milian, president and have very sophisticated electronic will mean the typical VLJ char- chief operating officer of Jet- equipment, someone needs to be ter will compete with turboprop Source in Carlsbad, Calif., wor- monitoring the cockpit while also aircraft. Consider a King Air 200 ries primarily about the effect a watching outside the aircraft for with three passengers—a reason- VLJ accident could have on the traffic and what not.” ably comfortable ride, particularly

16 Aviation Business Journal | 3rd Quarter 2006 for the short regional hauls VLJs ing to be easily sold on an aircraft The skeptics wonder, can a VLJ are likely to fly. Now put the same without that critical feature. operator base its future almost en- three passengers in the “cozy” Although many VLJ models fo- tirely on business travel and still cabin of the typical VLJ. “So here’s cus on business travel, the existing succeed? the million dollar question: What air charter industry relies not only “These airplanes will certainly will the consumer accept? Will on corporate business trips, but find a niche, but it will be regional a customer sacrifice cabin space also on longer leisure trips—ski- use and they will not likely be for shorter flight time in a VLJ?” ing, boating, hunting, and beach- widely used in traditional charter Keith wondered. bumming. Consider a chartered models,” said Dennis Keith, presi- Most of the VLJs on the drawing family leisure flight departing dent of Jet Solutions in Dallas, board or already test flying today New Jersey bound for Martha’s Tex. do not offer a lavatory or have Vineyard to visit Grandma. The The answer is unknown, but a “friends and family” lavatory, VLJ’s competitor, the typical char- DayJet and others have placed meaning that if someone uses the tered turboprop, can easily handle big stakes on the even bigger lavatory, everyone on the plane Mom, Dad, two kids, the family question: Will VLJs find a new had better be a family member or dog, and all the necessary baggage customer base in the competitive will instantly become a very close for a weekend stay. The same air charter market? Most in the friend. Historically, aircraft with- family chartering a VLJ, particu- aviation industry have adopted a out lavatories don’t sell well in larly one with a two-person crew wait-and-see mentality. “Without a the air charter market. The short policy, would have to leave Fido crystal ball, it’s simply impossible regional hauls the VLJ is expected at a kennel and keep baggage to to know how the VLJ will change to serve could alleviate the need an absolute minimum. Definitely our industry,” Keith said. for a lavatory, but many operators, no fishing poles or rollerblades on and some customers, are not go- this flight.

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Aviation Business Journal | 3rd Quarter 2006 17 Opportunity Finder Like many entrepreneurs, charter operator Michael Grossmann has adapted to the times—and they have been a-changin’ hourly, it often seems—to find his next great business opportunity.

he floor of the Grand Caravan port in Ohio, Grossmann’s Castle company in Grove City, building was painted yesterday, and Air operates a mixed fleet of six time,” Grossmann said. you can tell. The new paint Caravans, two jets, and several smell hangs in the air, and the other dedicated passenger charter Air Ambulance floor doesn’t have a scuffmark aircraft, a busy repair station, as Broker to Cargo Carrier on it, yet. Window guards pro- well as the newest FBO on the Several years later, in 1983, he Ttecting otherwise pristine Plexi- field, seizing opportunities wher- was involved in a car accident glas are yanked, seats installed, ever they can be found. It’s that that landed him in bed for six and voila! What yesterday was a flexibility and versatility that has weeks. “I had a lot of time to freighter carrying boxes is today a been a hallmark of his business think, and I decided that I could five-passenger pipeline patrol air- career—his constant willingness run a charter business better than craft, ready for a two-day mission. to turn on a dime. the company I was working for,” “Hey, whatever works,” Gross- “Back in 1978, I was a firefighter he said. “So, the following year, mann said, smiling beneath his and started flying because she I started my own air ambulance signature handlebar mustache. didn’t want to move to Kansas broker business. Then, we began In a way, that’s the story of City to be closer to my family,” managing a Navajo, hired pilots, Grossmann’s life. From his base he said, nudging his smiling wife and we were up and running as a at the Akron-Canton Regional Air- and business partner, Hilda. “So I charter provider. It’s been quite a made a deal with her. We’d stay in ride ever since.” By David W. Almy Youngstown, Pennsylvania, with Castle Air grew from one to five her family, but I’d start flying Navajos, to today’s six Caravans, lessons. I mean, really, it was that over a decade and a half. “1999 simple.” was actually the year of our busi- “I spent the next two years ness life,” Grossmann reflected. getting my ratings—commercial, “The economy was great. Every multi, instrument, in two years. Then, I started flying for a charter Continued on page 20

18 Aviation Business Journal | 3rd Quarter 2006 Continued on page 18

Aviation Business Journal | 3rd Quarter 2006 19 Castle Air Continued from page 19

cargo carrier was going nuts. We about price,” he said. airplane and they had mechanical, had two Caravans at the time, and September 11, 2001, ended that what did they do? They’d cancel each was flying 250 hours every boom. “Business started to slow in the flight,” he said. “Before 9/11, month. Nobody even asked you 2000,” Grossmann recalled. “We that flight would go because they how much. It was always whenev- saw a lot of competitors go out of were full.” er you have a plane, put me down business. When the automotive “I was in business with eight air- for it. I mean, that’s unheard of. cargo market dried up, that same lines. That’s part of understanding It’s one thing for passengers to year, I took delivery of two more what’s going on in your industry. reserve a plane...but for cargo—it Caravans. So here we are at the I went to the airlines. I visited ev- was that busy. And you could end of 2000 with four Caravans in ery one we’d done business with name your price because it didn’t a slowing market. And 9/11 really and found out what they needed. matter. Nobody even ever talked put the brakes on.” I just found out how the system works,” Grossmann said. “Listen, Fixing Airliners today, if an airplane leaves 30 “But you can’t afford to just sit minutes late in the morning, it there and wait for business,” he will be 30 minutes late all day continued. “You have to be proac- long because the airlines are run- tive and go out and look for it. So ning such a tight schedule. And I started going after the airline if they run 30 minutes late, they maintenance business. We had can lose up to 10 percent of their dabbled in it but never concen- passengers that day. 10 percent of trated on it.” their passengers! And if the plane During 2000 and 2001, Gross- doesn’t get out of the gate at all, mann built that up to be 30 percent they can lose $200,000-400,000 a of Castle Air’s business. “It took the day on a 737. So $2,000 for a main- place of all the freight business we tenance charter, in the big picture, lost as that market softened. Airlin- that’s pretty cheap.” ers were breaking everywhere,” he said with a grin. “We’d move both Pricey Fuel parts and/or mechanics at night Of course, fuel costs have affected and fix an AOG airplane because Castle Air just like every other op- most of the airplanes are parked at erator, and it’s one cost that Gross- night. Prior to 9/11, we were doing mann often has had to absorb two or three airplanes a night. Af- himself. “Our fuel expenses have ter 9/11, that stopped. The airlines doubled in the last year,” he said. couldn’t spend any money. They “On a Caravan, let’s say fuel went cut routes and everything else up 50 cents. Burning 60 gallons they were doing, so they had spare an hour, that’s $30. I can’t get $30 airplanes to use instead of fixing more per hour for the airplane. broken ones. Their flight activity The on-demand freight busi- didn’t come back until this year.” ness is very competitive. There The airline’s also changed are Internet sites where you bid their approach. “After 9/11, if the against other freight carriers. airlines had ten passengers on an Some of them—and I’ve seen this time and time again—don’t know how much their airplanes cost an “You never, never show the negative side. hour to operate. If they did, they You’re always positive, regardless of what’s wouldn’t send their airplanes out for less than it actually cost to going on. Negative doesn’t accomplish operate.” anything. So I try to stay positive all the “Those operators will sidestep engine reserves in order to make time. If your point of view is positive, your their numbers work. If you take employees will be positive. And if your all the reserve money out of there, you can operate ‘cheap’ employees are positive, then your business but sooner or later it’s going to will be positive.”

20 Aviation Business Journal | 3rd Quarter 2006 New Ad 2/27/06 3:33 PM Page 1 Aircraft bite you because you have to do cargo customers ‘What do you engine overhauls at some point. want, price or service?’ Because if And they’ll be out of business,” he you want price, I will not guaran- Leasing concluded. tee on-time delivery. If you want Grossmann calculates that 70 on-time delivery, then I have to percent of his business is freight, go with a little more expensive for Flight Schools 25 percent passenger charter, and operator (because the cheap guys and Universities 5 percent FBO. To achieve those are unreliable) and I’ll guarantee numbers, Grossmann spends less the times. But the majority of the • Lease by the hour than three hours a day at his desk, time, the customer will say, ‘Give • Flexible terms to meet your needs preferring to be in a cockpit or me the cheapest.’” a hangar. “But they only call me “Conversely, in passenger world, • Seasonal considerations when they run out of pilots and I it’s all about service,” he said. “It’s • Aircraft offered: can fly,” he said. about doing the little things, like Cessna 152 the cookies in the lobby and little Online Brokers touches like that.” Cessna 172 Are the Market Cessna 172R In the Internet age, Castle Air Expensive Cessna 172SP doesn’t have a dedicated sales staff. Fuel and People Cessna 172 RG It instead secures the lion’s share The two biggest financial issues Beech Duchess of its business via online contacts. for Castle Air last year were that “The vast majority of our busi- fuel and employee costs went Piper Seminole ness on the passenger side and the through the roof. “We almost dou- Piper Warrior freight side comes from brokers,” bled our gross sales, but our costs Grossmann said. “So the brokers more than doubled,” Grossmann • Aircraft painted to match are the ones who spend the money said. “Managing growth is its own your organization’s colors marketing, going after the custom- challenge, requiring adjustments. • References on request ers. I’m an airplane operator. That’s We’re not as lean as we could’ve what I’ve done for years.” been, but we’re getting better.” “We’ll still quote a customer “As fuel prices started going up, when they call us directly,” he on the passenger side, we added said. “But the good is that a fuel surcharge, so we really if they’re calling you, you have a didn’t lose money on the passen- much better chance of getting the ger end,” he continued. “But on • Tulsa’s premier FBO flight than if we’re quoting it on a the freight end I was not able to • Call ahead for special jet fuel prices bid board. Everything is going In- add fuel surcharges as easily as ternet, so you constantly have to you might think. It’s good for us watch the Internet boards. That’s to be our own fuel supplier here For more information, why we have somebody in the in Ohio, but when you start going call Bill or Lori office 24-hours a day. You have out on the road, you start paying to watch the bids come up so we $5 a gallon, and that hurts.” can bid on them. Activeaero.com Grossmann reports that common is probably the biggest website, industry practice allows landing and then probably behind that is fees and ramp fees to be passed AirNow.com. They have a big bid- through to the customers, but ding board.” fuel costs aren’t. “So how do you In the freight business, 80 compensate for that?” he asked. percent of Grossmann’s business “You don’t make as much money Christiansen comes via the Internet, and price as you’d like on the airplane, but rules. there are different things you Aviation Inc. “It’s not service; it’s the bot- can do to lower your hourly cost. tom line. It’s just about dollars,” You can fly the aircraft more per (877) 331-5550 Grossmann explained. “A friend month, taking a lot of these costs www.christiansenaviation.com told me he was doing a lot of Established in 1972 brokering, too, and he would ask Continued on page 22

Aviation Business Journal | 3rd Quarter 2006 21 Castle Air Grossmann’s Five Continued from page 21 Secrets to Success and spreading them around, low- are doing very well are the ones graduate of the School of Hard ering your costs on the airplane by who have been able to adapt to Knocks, Grossmann thinks a flying it more per month.” their customers and adapt their degree in business may have “We’re trying to become a little business to what has been hap- Ahelped him. “It certainly would more inventive on how we’re pening. The ones who were just have helped in running or develop- doing in business,” Grossmann in one market? I mean, I can list ing a business in aviation,” he said. said. “Because we can’t raise a half dozen companies, more on “This business is very dynamic. prices—I’m only able to charge the cargo side, that are no longer Over the years, I’ve learned from today what I was charging in 1999 around because they didn’t have making mistakes. I don’t care if you for the Caravan when fuel was the ability to see or have some have a degree or not, you still learn 92 cents per gallon. Today, it’s sort of inner vision on what could from making mistakes. Except with three dollars. And back then, my possibly happen.” a degree, you should be some- planes were new. Today, they’ve “The single best decision I what more intelligent and maybe got 9,000 hours on them, which made in business was to get a shouldn’t have made the mistakes means there will always be a little Caravan because that’s when I re- in the first place. We all learn from bit more maintenance, so the ally started making some decent our mistakes, but unfortunately, hourly cost of things has gone up. money. The Caravan just goes when you learn from your mistakes, There’s no real easy, quick fix. and goes and goes. Certainly the the lesson is normally expensive. I second best decision I made was didn’t always know if I was doing it The Next Opportunity moving to a big airport, which the right way or the wrong way, but “We’re getting more into the really got us going. You make a it certainly was my way.” single-engine charter with the lot of little decisions all day long, Today, Grossmann lives by five Caravan because not everybody all year long, but very few of the “secrets to success,” which he cred- can afford a jet or the Cheyenne,” big business decisions you make its to Walt Disney: Grossman said. “I didn’t see the really change the course of what single-engine turbine passenger you’re doing. Moving here and Think tomorrow charter market before. Now, I see buying Caravans were certainly • Imagine the possibilities the market. We can more than two of them,” Grossmann con- • Free up your imagination halve the cost of a King Air 200 cluded. • There are no limits to what we with the Caravans. There’s an op- “I love coming to work in the can do portunity there. I would like to fly morning,” he declared. “I get up Strive for lasting quality 50 passenger-hours each month in the morning, and I love the • Everyone has to buy into quality and make as much as I do flying business and I love what I do. My and believe in quality 80 cargo-hours in the Caravan. So father taught me that. He told • Be sincere it’s about flying the airplane less, me: ‘Whatever you do make sure making more, and improving air- you like it. There’s nothing worse Love what we do craft resale and the same time.” than getting up in the morning • Work hard Grossmann remains passion- hating to go to work.’ I don’t care • Pay attention to little things ately flexible when it comes to how bad things are, I do not hate • Welcome competition going to work. I get up in the finding profitable aviation busi- Stick-to-it-tivity ness lines. “Since being involved morning, and I can work here 10, • Hang in there with NATA, I have met opera- 12, 14 hours a day. I just love this • Don’t give up tors all over the country—cargo business, I love being around our • Our only talent is perseverance operators, passenger operators” people, and that keeps me going Grossmann said. “The ones who because I love what I do.” Have fun • Be yourself

22 Aviation Business Journal | 3rd Quarter 2006

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(386) 427-4222 While software updates are important, they don’t compare to adding the resources, connections and customer (800) 200-7887 service of a leader in business aviation. Cornerstone Logic, Inc., the creator of FBO Manager, is now set to go to the next level as a subsidiary of Universal Weather and Aviation, Inc. A global leader in trip support and fbomanager.com fueling card services through the UVair® Fuel Program, Universal® brings us the resources to provide 24/7 universalweather.com customer support, deliver wider fueling card acceptance, develop innovations more rapidly, add training resources and respond quickly to industry changes. For details on how this update can make your FBO more productive, efficient and profitable, contact John Nelson at (800) 200-7887, or visit fbomanager.com. FBO Accounting Software Moves Beyond Bookkeeping By Paul Seidenman and David Spanovich

t a time when most small airfields away from urban areas, “You’ve got to be able to account businesses have transitioned mostly serving an owner-flown for that, so that you can resupply their accounting tasks from piston aircraft clientele. the fuel. The problem is that your pen-and-ink ledgers to per- “Of the 2,300, about one-third or basic back office software can’t do sonal computers, many FBOs about 765, are still using manual this because it is accounting, not still rely largely on manual accounting methods,” he said. aviation, specific.” bookkeepingA methods. Others “They probably use credit card Steve Dennis, CEO of the Avia- have automated to the point of us- processing machines, but that’s tion Resource Group Internation- ing generic back office programs the extent of the automation. Al- al, a Denver-based FBO consulting that are not aviation-specific though they might at some point firm, noted that FBO accounting and were never designed for the move into a very basic account- software users also need real-time unique FBO business environ- ing software product, the primary access to two types of information: ment. market opportunity in account- accounting data and “customer “When you look at the market ing software will be among those specific” information. for FBO accounting software, the FBOs that now use some kind of “[Customer specific information] majority of FBOs—mostly the general accounting software. For enables you to keep an ongoing smaller ones—are using simple that group, this means moving record of the names of the per- starter kits designed for very toward aviation-specific account- sons who are operating or flying general accounting,” said Gloria ing products.” on the aircraft and the types of Barnes, president of Wellington- products and services they usually Royce, an FBO accounting soft- Made for an FBO request,” he said. “Customer spe- ware firm in Atlanta, Ga. She said Aviation-specificity has emerged cific data has become an essential that while medium to large FBOs as a key design feature and pre- marketing tool because everybody are using “partial systems” and requisite for today’s FBO account- likes to be known by name. With older aviation-related software, ing software products. This means the data in hand, the FBO is bet- many of them don’t know that going well beyond bookkeeping ter prepared for the arrival of the newer software is available that to include such areas as customer aircraft, its crew, and passengers. can save more time and provide service and inventory control. At the same time, the accounting better financial reporting. “Letting One example is commingled fuel, function automates the flow of the industry know about this is which occurs when the fuel the information concerning the trans- probably our biggest challenge,” FBO purchases for resale is stored actions taking place with those she said. in the same facilities as fuel paid customers, so the two run parallel Jeff Kohlman, principal of the for by an outside company for its to each other.” Aviation Management Consult- own consumption. That could be Bill Greenwell, a partner in ing Group in Greenwood Village an airline for which the FBO has Frederick Aviation, an FBO at the (Denver), Colo., agrees, noting an into-plane fueling contract. Frederick Municipal Airport in that the degree of accounting sys- “When you manage commingled Maryland, agrees. “You have to tem automation still varies widely fuel, you need software that tells have some type of management among FBOs. He explained that you what you’ve bought, what system wrapped around the ac- although the top third of the 3,500 your customer has put in, what counting data function, such as a FBOs in the United States have you’ve sold, and what’s left in the marketing module, which codes adopted comprehensive, avia- tank—both yours and the custom- your customers by the kinds of tion-specific accounting software er’s,” said Jack Demeis, president products and services they buy,” systems, some 2,300 have more of Austin, Tex.,-based Continuum he said. “With that, you can better limited packages or none at all. Applied Technology, Inc., a spe- target your promotional mailings.” These, Kohlman said, tend to be at cialist in FBO accounting systems. Continued on page 26

Aviation Business Journal | 3rd Quarter 2006 25 FBO Accounting Software Continued from page 25

These requirements imply more with everything available, that you accounting system vendors. robust and complex “point of sale” only have to log onto just once.” “As the industry consolidates, (POS) software, which tracks all Not everyone believes that more chains will develop, and that the business actually transacted combining a POS system with a will be very helpful for us,” said at the front counter. That can back office system is the way to Hubert (Hubie) Lee, president of include fuel sales, catering orders, go. Mike Wardwell, chief financial PRG Aviation Services, an FBO hotel and rental car bookings, and officer and comptroller of Million accounting software developer maintenance. The POS transac- Air Dallas, a full-service FBO, se- located in Woodland Hills, Ca- tions are processed by the soft- lected the Base System, a fully in- lif. “The chains will have more ware, and the data is fed to the tegrated FBO accounting software employees and be run by sophis- back office accounting systems, package from Wellington-Royce ticated management teams that which essentially perform a book- of Atlanta, Ga., because it was a will demand the tools to monitor keeping or general ledger function. complete system. “A fully inte- market share, margins, and other Aviation Management Consult- grated package is important to us metrics to make them more com- ing Group’s Jeff Kohlman said that because we believe it does a better petitive. They will look at balance FBO accounting software vendors job of driving a seamless flow of sheets and income statements a are recognizing that POS prod- information,” he said. “We looked little more than skin deep.” ucts present major opportunities. at separate accounting packages, Continuum Applied Technolo- “When most of the FBOs initially and they were not as stable or as gies’ Jack Demeis urged account- automated their accounting func- seamless as we would have liked.” ing software developers to view tions, they purchased low cost, Wardwell pointed out that se- off-the-shelf back office systems,” lecting the Base System also had a Software Product Vendor/Manufacturer Capabilities Average Price Range Customer / Sales Contact he said. “They didn’t do every- lot to do with the fact that Million Continuum Applied • Fuel POS, inventory & concierge services License (one-time purchase): $1,800-2,900 per concurrent thing the users wanted, but they Air Dallas offers many services, Technology, Inc. Corridor Workgroup • Work order quoting, work orders & invoices user (minimum user count may apply) * Chris Kubinski did most things well and were including fuel, charter, line main- 9601 Amberglen Blvd. Edition — Small Single • Procurement & inventory management ————————————— (512) 918-8900 x244 inexpensive. But then the software tenance, and aircraft sales. “You Suite 109 Facility • Logbook research & maintenance tracking ASP (subscription): $100-140 per concurrent user/month [email protected] vendors realized that they could really have to take a good look at Austin, TX 78729 • Part sales (minimum user count may apply) * develop products that automate your operation when choosing an www.corridor.aero the POS function and could easily accounting system,” he said. “If, Continuum Applied be attached to, and work with, for example, we only sold fuel, • Fuel POS, inventory & concierge services License (one-time purchase): $2,200-3,400 per concurrent Technology, Inc. the current back office systems. there would probably be other Corridor Workgroup • Work order quoting, work orders & invoices user (minimum user count may apply) * Chris Kubinski 9601 Amberglen Blvd. Frankly, it’s far more cost effec- systems that would be compatible Plus Edition — Medium • Procurement & inventory management ————————————— (512) 918-8900 x244 Suite 109 tive to do that because you are with that kind of an operation.” Single/Main Facility • Logbook research & maintenance tracking ASP (subscription): $120-160 per concurrent user/month [email protected] Austin, TX 78729 keeping your current back office The Aviation Resource Group • Part sales (minimum user count may apply)* www.corridor.aero system. This saves on installation International’s Steve Dennis esti- Continuum Applied and training costs.” mated that the aviation-specific, • Fuel POS, inventory and concierge services Technology, Inc. Paul Liepe, president of MyFBO. off-shelf accounting software prod- Corridor Enterprise Plus • Work order quoting, work orders & invoices License: Contact vendor for pricing Chris Kubinski 9601 Amberglen Blvd. com, a Danville, Va.,-based devel- ucts available today are applicable Edition — Large Multi • Procurement and inventory management ————————————— (512) 918-8900 x244 Suite 109 oper and vendor of an Internet- to about two-thirds of the FBO in- Facility • Logbook research and maintenance tracking ASP (Subscription): N/A [email protected] Austin, TX 78729 based FBO accounting product dustry. “For the remainder, there • Part sales of the same name, reported that are at least a few cases where www.corridor.aero today’s customers expect state- integrated, proprietary systems • Integrated credit card processing PRG Aviation Systems Prices start at $320 per month (including maintenance & Hubert Lee of-the-art software packages that would be necessary because they • Immediate & extensive reporting – easy to understand reports 6351 Owensmouth Avenue, support), or license purchase at $ 5,950 (800) 877-1425 will interface with such popular can be customized to the exact ELS Fuel Management • Designed by a CPA – solid financial basis with internal controls & Suite 105 ————————————— (818) 710-1425 back office systems as QuickBook, requirements of the FBO,” he said. System audit trails Woodland Hills, CA 91364 Available via month-to-month subscription or one-time [email protected] which is used by half of his cus- “The more general off-the-shelf • Airline Accounting option www.prgaviation.com purchase tomers. products that have an industry- • Migration path to FBOperational Fuel Management System “What we hear most often from wide application may not always John Nelson our customers is that they want be suitable for very complex FBO Cornerstone Logic, Inc. • Fuel truck automation $5,500 LeeAnn Nelson to move toward full integration of operations.” PO Box 1744 • Credit card processing for all oil companies, bank cards ————————————— Jason Levine the back office accounting soft- Along this line, the consolida- FBO Manager New Smyrna Beach, FL 32170 • Touch screen interfaces Available via one-time purchase; New ‘Lite’ versions and (800) 200-7887 ware with POS programs such as tion of the industry over the past www.fbomanager.com • Connects to major accounting programs subscription basis coming (+1 386 427 4222) ours,” Liepe said. “By doing that, few years may ultimately influ- [email protected] what you get is a single package ence the direction taken by FBO

26 Aviation Business Journal | 3rd Quarter 2006 FBO consolidations as an inexo- software programs that reside on FBO firms that use the Internet rable trend. “The mom-and-pop the vendor’s server. MyFBO.com’s to interface with their company’s operation is becoming a thing of Paul Liepe said that the advantage central server,” he said. “However, the past and is giving way to the of an Internet-based system is for single location FBOs, the issue multiple location, multi-service reduced start-up costs. “If auto- is the integrity of Internet con- facility that will demand a more mation means a large front-end nectivity. Until that is 100 percent sophisticated software product,” investment in servers, that might failsafe, dependence on the Inter- he said. “Because consolidation re- be too expensive for some people,” net carries a huge risk. If you lose sults in the creation of a group of he said. your Internet connection while companies that will work together Jeff Kohlman of Aviation Man- you are carrying out a function, to standardize their quality of ser- agement Consulting Group said then you will lose the ability to vice, information sharing becomes that more vendors are looking perform the function until you are more critical and requires enter- toward Internet-based software reconnected.” prise capable systems.” packages for FBO accounting. Kohlman said that because most Another slowly emerging trend “This is being done now, but most- is Internet access of accounting ly with the large, multi-location Continued on page 28 NOTE: All data was supplied by software vendors. * Implementation services (installation, training, etc.) and technical support are additional and driven by several factors.

Software Product Vendor/Manufacturer Capabilities Average Price Range Customer / Sales Contact Continuum Applied • Fuel POS, inventory & concierge services License (one-time purchase): $1,800-2,900 per concurrent Technology, Inc. Corridor Workgroup • Work order quoting, work orders & invoices user (minimum user count may apply) * Chris Kubinski 9601 Amberglen Blvd. Edition — Small Single • Procurement & inventory management ————————————— (512) 918-8900 x244 Suite 109 Facility • Logbook research & maintenance tracking ASP (subscription): $100-140 per concurrent user/month [email protected] Austin, TX 78729 • Part sales (minimum user count may apply) * www.corridor.aero Continuum Applied • Fuel POS, inventory & concierge services License (one-time purchase): $2,200-3,400 per concurrent Technology, Inc. Corridor Workgroup • Work order quoting, work orders & invoices user (minimum user count may apply) * Chris Kubinski 9601 Amberglen Blvd. Plus Edition — Medium • Procurement & inventory management ————————————— (512) 918-8900 x244 Suite 109 Single/Main Facility • Logbook research & maintenance tracking ASP (subscription): $120-160 per concurrent user/month [email protected] Austin, TX 78729 • Part sales (minimum user count may apply)* www.corridor.aero Continuum Applied • Fuel POS, inventory and concierge services Technology, Inc. Corridor Enterprise Plus • Work order quoting, work orders & invoices License: Contact vendor for pricing Chris Kubinski 9601 Amberglen Blvd. Edition — Large Multi • Procurement and inventory management ————————————— (512) 918-8900 x244 Suite 109 Facility • Logbook research and maintenance tracking ASP (Subscription): N/A [email protected] Austin, TX 78729 • Part sales www.corridor.aero • Integrated credit card processing PRG Aviation Systems Prices start at $320 per month (including maintenance & Hubert Lee • Immediate & extensive reporting – easy to understand reports 6351 Owensmouth Avenue, support), or license purchase at $ 5,950 (800) 877-1425 ELS Fuel Management • Designed by a CPA – solid financial basis with internal controls & Suite 105 ————————————— (818) 710-1425 System audit trails Woodland Hills, CA 91364 Available via month-to-month subscription or one-time [email protected] • Airline Accounting option www.prgaviation.com purchase • Migration path to FBOperational Fuel Management System John Nelson Cornerstone Logic, Inc. • Fuel truck automation $5,500 LeeAnn Nelson PO Box 1744 • Credit card processing for all oil companies, bank cards ————————————— Jason Levine FBO Manager New Smyrna Beach, FL 32170 • Touch screen interfaces Available via one-time purchase; New ‘Lite’ versions and (800) 200-7887 www.fbomanager.com • Connects to major accounting programs subscription basis coming (+1 386 427 4222) [email protected]

Aviation Business Journal | 3rd Quarter 2006 27 FBO Accounting Software Continued from page 27

U.S. FBOs are at airports a consid- erable distance from metropolitan Software Product Vendor/Manufacturer Capabilities Average Price Range Customer / Sales Contact areas, they still use dial-up rather than high-speed Internet connec- • Monitors operations in “real time” – tracks all service requests; tions. “Internet-based accounting Forecasts manpower requirements, scheduled arrivals & programs require a high-speed departures PRG Aviation Systems • Dispatching & monitoring of all services – uses “alarms” to $750/month (includes maintenance & support); or license service, which keeps a lot of FBOs Hubert Lee 6351 Owensmouth Avenue, identify overdue items purchase at $14,000 from using them. However, within FBOperational Fuel (800) 877-1425 Suite 105 • Integrated concierge services – emails confirmations to vendors ————————————— the next five to ten years, we Management System (818) 710-1425 Woodland Hills, CA 91364 & customers Available via month-to-month subscription or one-time expect to see further development [email protected] and refinement of Internet-based, prgaviation.com • Integrated credit card processing purchase aviation-specific accounting soft- Tex., software vendor. • Immediate & extensive reporting – evaluates impact of pricing ware.” The Corridor family, first intro- decisions, manpower utilization, metrics & other reports for The FBO accounting software duced in 1997, consists of three controlling costs producers are eyeing all the mar- products: Corridor Workgroup and ket trends and have tailored their Corridor Workgroup Plus, targeted • Integrates line service, flight operations, shop floor and POS activities products to a broad range of cus- respectively to small and medium- MyFBO.com $50-400 per month, depending on FBO needs • Multi-location (enterprise) ready/scalable Contact any staff member tomers, from the large, multi-ser- size FBOs, and Corridor Enter- 926 Main Street ————————————— MyFBO.com • Internet based – no installation required (434) 793-6800 vice chain with posh facilities at prise Plus, designed for larger FBO Danville, VA 24541 Monthly subscription delivered via Internet • Wireless access available [email protected] urban airports to the independent operations. Each is available with www.myfbo.com working out of a trailer and dis- up to 25 different modules that • Exports transactions to QuickBooks and other back-end accounting pensing fuel from a single pump can be selected by the customer. packages Demeis explained that Corridor at a rural landing strip. Aviation • Full integration for all data transactions into accounting is designed for compatibility with The BASE System Wellington-Royce Corporation Business Journal has identified six • Flexible pricing setup with automated discounts $20,000-30,000 Gloria Barnes the size and mission of the user, (Business 6065 Roswell Road, #2200 major vendors of nine account- • Profit & loss statements by aircraft ————————————— (770) 395-7400 letting customers pay only for Aviation Software Atlanta, Georgia 30328 ing software products designed • Data security and complete audit trails One-time purchase of license with annual renewal of support [email protected] what they actually need. Corri- Engine) www.wellingtonroyce.com specifically for FBO applications. • Supports all aviation services and business processes Regardless of size, finding the dor’s latest release, Version 8, will be announced at this year’s NBAA • Full accounting right product means planning TotalFBO Horizon Business Concepts, Inc. Traci Lynch convention in Orlando, Fla. • Point of sale functions $5,000-8,000 ahead, as the Aviation Resource Accounting 721 West Queens St. (800) 359-9804 One of Corridor’s major fea- and Aviation • Shop orders ————————————— Group International’s Steve Den- Broken Arrow, OK 74012 [email protected] nis advised. “Look about three to tures is that it can work in tandem Management • Maintenance tacking One-time purchase with service plans available Software www.TotalFBO.com five years out,” he said. “During with most existing (non-aviation- • Concierges; charter; flight school; inventory management that period, ask yourself, will your specific) back office accounting business stay about the same or software systems. This, according customers, the company’s major grow. If it remains about the same, to Demeis, addresses the fact that market has evolved into the multi- then I would consider the least most businesses tend not to want location FBO, serving primarily expensive off-the-shelf product. to change their primary legacy ac- a turbine trade, according to the But if you are looking at growth, counting systems. firm’s founder and vice president I’d advise choosing one that is The company offers installa- John Nelson. expandable, one you can add tions on a single desktop PC or on FBO Manager is designed to more modules to as your business a central server under a license bridge the front desk and back of- agreement. For Corridor Work- grows.” fice by automating the processing group and Corridor Workgroup of all sales transactions and trans- Plus, an Internet delivery option mitting the data to the FBO’s main is available on a per user, monthly accounting software package. The subscription basis. system uses a touch screen inter- Continuum Applied face for processing fuel, catering, Cornerstone Logic and other services and to gener- Technology, Inc. Cornerstone Logic, of New Smyr- ate receipts and invoices, totally One of the best known POS prod- na Beach, Fla., is well known for eliminating manual methods. ucts for the FBO industry, Cor- its FBO Manager, a POS software To process fuel sales on the ridor counts literally thousands product marketed to FBO op- ramp, FBO Manager interfaces of users to date, according to Jack erations of all sizes and to flight with the fuel truck via an elec- Demeis, president of the Austin, schools. With more than 350 tronic register, which records the

28 Aviation Business Journal | 3rd Quarter 2006 Software Product Vendor/Manufacturer Capabilities Average Price Range Customer / Sales Contact

• Monitors operations in “real time” – tracks all service requests; Forecasts manpower requirements, scheduled arrivals & departures PRG Aviation Systems • Dispatching & monitoring of all services – uses “alarms” to $750/month (includes maintenance & support); or license Hubert Lee 6351 Owensmouth Avenue, identify overdue items purchase at $14,000 FBOperational Fuel (800) 877-1425 Suite 105 • Integrated concierge services – emails confirmations to vendors ————————————— Management System (818) 710-1425 Woodland Hills, CA 91364 & customers Available via month-to-month subscription or one-time [email protected] prgaviation.com • Integrated credit card processing purchase • Immediate & extensive reporting – evaluates impact of pricing decisions, manpower utilization, metrics & other reports for controlling costs

• Integrates line service, flight operations, shop floor and POS activities MyFBO.com $50-400 per month, depending on FBO needs • Multi-location (enterprise) ready/scalable Contact any staff member 926 Main Street ————————————— MyFBO.com • Internet based – no installation required (434) 793-6800 Danville, VA 24541 Monthly subscription delivered via Internet • Wireless access available [email protected] www.myfbo.com • Exports transactions to QuickBooks and other back-end accounting packages • Full integration for all data transactions into accounting The BASE System Wellington-Royce Corporation • Flexible pricing setup with automated discounts $20,000-30,000 Gloria Barnes (Business 6065 Roswell Road, #2200 • Profit & loss statements by aircraft ————————————— (770) 395-7400 Aviation Software Atlanta, Georgia 30328 • Data security and complete audit trails One-time purchase of license with annual renewal of support [email protected] Engine) www.wellingtonroyce.com • Supports all aviation services and business processes • Full accounting TotalFBO Horizon Business Concepts, Inc. Traci Lynch • Point of sale functions $5,000-8,000 Accounting 721 West Queens St. (800) 359-9804 and Aviation • Shop orders ————————————— Broken Arrow, OK 74012 [email protected] Management • Maintenance tacking One-time purchase with service plans available www.TotalFBO.com Software • Concierges; charter; flight school; inventory management

NOTE: All data was supplied by software vendors.

fuel flow information from the chise type operations. The system meter installed on the truck. A is being used by more than 1,200 900-Megahertz Wi-Fi is used to users worldwide. transmit the data to the FBO back In August, Horizon Business office software, thus eliminating Concepts contracted with Hous- voice radio communications and Horizon ton-based Million Air to be the all paperwork associated with exclusive accounting software those transactions. FBO Manager Business Concepts provider for the FBO franchise works with all major brands of TotalFBO is a well-known, totally group. For Million Air, the vendor fuel truck meters, and Corner- integrated accounting product for will supply its Enterprise ver- stone supplies kits to retrofit the the FBO industry produced for the sion of TotalFBO, which has been fuel trucks for compatibility with past 18 years by Horizon Business the fuel automation system. designed for multi-location opera- Concepts, a Broken Arrow (Tulsa), Though acquired in August by tions. Houston, Tex.,-based Universal Okla., software company. To date, TotalFBO, explained company Weather and Aviation, Corner- five versions of the system have president Leann Lehmann, is a stone Logic is being operated by been released, and its customer highly versatile system designed the larger firm as a wholly owned base ranges from small FBOs subsidiary. through major chains and fran- Continued on page 32

Aviation Business Journal | 3rd Quarter 2006 29  Keeping customers and passengers aloft requires a rock-solid business foundation. And no supplier is more stable and reliable than Chevron Global Aviation. Only a company like Chevron can provide such a high level of service to a broad range of constituents from general aviation investors, to corporate pilots, FBOs of all sizes, even weekend sport pilots. Chevron Global Aviation offers a network of over 750 FBOs, and a consistently reliable supply of high quality fuels 2OUND thanks to our refi nery and transportation infrastructure. Because at Chevron Global Aviation, we know it’s about more than just a good fl ight. It’s about good business. For more information, visit us at www.chevronglobalaviation.com 0RINTOUTAT Ink: CMYK Initial Date Ali HJ Chris/Virginia Yvonne AE: AD: PM: PM: CW: Name:Corporate (Ad Spread) Initial Date Amanda Naeem Rick Sharee DTP: Proof: Traffic: Traffic: St Mgr: Buddy Check: _____ Spell Trim: 17" x 11" Live: 16.5" 10.5" Bleed: 17.25" 11.25" Magenta KeyLines DO Not Print Job #: CHV AVI M66366 303 2nd Street, Street, 2nd 303 Tower S. Floor, 8th 94107 CA SF, 0600 882 415 T: 37463 Version:02 07-20-06 gm 37463 Version:02

Eurographics © 2006 Chevron Products Company, a division of Chevron U.S.A. Inc., Houston, TX.

The only thing better than heading into the blue, is knowing that there’s a blue-chip company behind you.

© 2006 Chevron Products Company, a division of Chevron U.S.A. Inc., Houston, TX. 37463_M66366_CAD_v2 1 7/20/06 3:22:40 PM

PACIFIC DIGITAL IMAGE • 333 Broadway, San Francisco CA 94133 • 415.274.7234 • www.pacdigital.com Filename:37463_M66366_CAD_v2.ps_wf01 Operator:SpoolServer Time:15:30:54 Colors:Cyan, Magenta, Yellow, Black Date:06-07-20

NOTE TO RECIPIENT: This file is processed using a Prinergy Workflow System with an Adobe Postscript Level 3 RIP. The resultant PDF contains traps and overprints. Please ensure that any post-processing used to produce these files supports this functionality. To correctly view these files in Acrobat, please ensure that Output Preview (Separation Preview in earlier versions than 7.x) and Overprint Preview are enabled. If the files are re-processed and these aspects are ignored, the traps and/or overprints may not be interpreted correctly and incorrect reproduction may result. Please contact Pacific Digital Image with any questions or concerns.  Keeping customers and passengers aloft requires a rock-solid business foundation. And no supplier is more stable and reliable than Chevron Global Aviation. Only a company like Chevron can provide such a high level of service to a broad range of constituents from general aviation investors, to corporate pilots, FBOs of all sizes, even weekend sport pilots. Chevron Global Aviation offers a network of over 750 FBOs, and a consistently reliable supply of high quality fuels 2OUND thanks to our refi nery and transportation infrastructure. Because at Chevron Global Aviation, we know it’s about more than just a good fl ight. It’s about good business. For more information, visit us at www.chevronglobalaviation.com 0RINTOUTAT Ink: CMYK Initial Date Ali HJ Chris/Virginia Yvonne AE: AD: PM: PM: CW: Name:Corporate (Ad Spread) Initial Date Amanda Naeem Rick Sharee DTP: Proof: Traffic: Traffic: St Mgr: Buddy Check: _____ Spell Trim: 17" x 11" Live: 16.5" 10.5" Bleed: 17.25" 11.25" Magenta KeyLines DO Not Print Job #: CHV AVI M66366 303 2nd Street, Street, 2nd 303 Tower S. Floor, 8th 94107 CA SF, 0600 882 415 T: 37463 Version:02 07-20-06 gm 37463 Version:02

Eurographics © 2006 Chevron Products Company, a division of Chevron U.S.A. Inc., Houston, TX.

The only thing better than heading into the blue, is knowing that there’s a blue-chip company behind you.

© 2006 Chevron Products Company, a division of Chevron U.S.A. Inc., Houston, TX. 37463_M66366_CAD_v2 1 7/20/06 3:22:40 PM

PACIFIC DIGITAL IMAGE • 333 Broadway, San Francisco CA 94133 • 415.274.7234 • www.pacdigital.com Filename:37463_M66366_CAD_v2.ps_wf01 Operator:SpoolServer Time:15:30:54 Colors:Cyan, Magenta, Yellow, Black Date:06-07-20

NOTE TO RECIPIENT: This file is processed using a Prinergy Workflow System with an Adobe Postscript Level 3 RIP. The resultant PDF contains traps and overprints. Please ensure that any post-processing used to produce these files supports this functionality. To correctly view these files in Acrobat, please ensure that Output Preview (Separation Preview in earlier versions than 7.x) and Overprint Preview are enabled. If the files are re-processed and these aspects are ignored, the traps and/or overprints may not be interpreted correctly and incorrect reproduction may result. Please contact Pacific Digital Image with any questions or concerns. FBO Accounting Software Continued from page 29

for single computer use or for a tion. Flashturn will be offered to online credit card processing, fuel central server. The software is TotalFBO users at a discount. farm management, ground service also designed for multiple service TotalFBO is offered under a reservations, flight dispatching, operations, including fuel, main- license as well as a license plus an maintenance, and inventory man- tenance, charter, flight schools, optional, yearly fee-based service agement. For flight schools, the concierge, and customer profiles. plan that provides unlimited sup- software provides student curricu- By this fall, the vendor will add port, including software upgrades, lum tracking. an Internet feature called the at no additional charge. The software’s safety and secu- “Flashturn On Line Service Re- rity features include hazardous quest System,” which will be avail- incident reporting and tracking, able to FBOs on a subscription while a security module supplies basis. Customers of those FBOs TSA-related information for for- will be directed to the Flashturn eign students wanting to train at site, where they can register and MyFBO.com U.S. flight schools and generates confirm a service request—all at security badges and passes. no charge to them. Participating In 1998, MyFBO.com introduced MyFBO.com can also provide FBOs can use the site to advertise an FBO accounting software customers with PDAs that can fuel prices and provide for ser- product of the same name that re- process a credit card transaction vice reservations. Lehman said sides exclusively on the Danville, on the ramp. Using cell phone the system is now in Beta testing Va.,-based vendor’s server and is networks, the sales data is trans- with current TotalFBO customers accessible solely online. Company and will be offered to the broader president Paul Liepe said that mitted directly to the MyFBO. market following an announce- MyFBO.com has a large presence com company server, which then ment at this year’s NBAA conven- in the small to mid-size multiple generates an email receipt, sent to location FBO seg- the buyer, for the transaction. ment, although it PRG Aviation Systems does count very large multi-service PRG Aviation Systems, a Wood- chains among its land Hills, Calif.,-based software customers. company, offers two accounting According to products specifically geared to the Liepe, MyFBO. FBO industry: ELS Fuel Manage- com “fills a gap” ment System and FBOperational "Maintenance Productivity between the Fuel Management System. has never been higher small flight school Company president Hubie Lee and Inventory requiring some describes ELS as a system de- never more accurate." automation for air- signed for the small and medium- Cary A. Winter - Executive Vice President, North American Jet craft dispatch and size FBO that fuels 40 to 60 air- CORRIDOR Aviation Service Software is designed for our industry. the large FBO that craft per day, mainly owner-flown Designed for your business. It works with your business processes can afford to install to improve safety, costs, and efficiency. piston models. Specifically, the in-house servers. software provides POS tracking Our Industry Your Business FBOs Work Orders Because it is an Repair Stations Line Service Internet-based Operators Rotables MROs Inventory system, servers are Refurb Shops Part Sales R&O Compliance not required. Fixed Wing Accounting Integration Rotor Quoting... and more! Along with cus- tomer accounting 996 1 functions such as C RRIDOR billing and pre- 2 0 0 6 Celebrating 10 Years payment track- ing, MyFBO.com’s Ask Around. See who's talking about capabilities include CORRIDOR. Then contact us for a www.corridor.aero leasing and con- demo, and let us show you how 512.918.8900 CORRIDOR will impact your business. tract accounting,

32 Aviation Business Journal | 3rd Quarter 2006 and accounts receivable manage- users are mostly full-ser- ment and reporting. It can also vice FBOs. generate invoices and post data to BASE has more than the user’s general ledger software 22 applications, with for financial statement purposes. eight core applications The more capable FBOperation- built in. Of the core al caters to the major FBO firm applications, three that needs an advanced planning are dedicated to basic tool to control costs and manpow- accounting functions: er requirements. The typical user accounts payable, ac- has a large, demanding customer counts receivable, and base that can include corporate general ledger. The flight departments, fractional own- remaining applications ership companies, and airlines. are available on an op- FBOperational offers more tional basis, which can than just basic, monthly financial be easily incorporated reporting capability, Lee said. as a customer’s business on the client’s server and can be Among the software’s more ad- grows. For example, the “Purchase delivered to the customer via CD, vanced capabilities is its ability to Services Request” option is a req- tapes, or the Internet. It is compat- determine what impact a pricing uisition system that can be used ible with both single and multiple decision might have on a specific when an FBO needs to acquire location FBOs. In fact, only one product or service the FBO offers. equipment. server is required for single and It also enables the FBO to track At the end of August, three ad- multi-location FBO companies. customer purchases throughout ditional modules the day, helping the operator de- were added to the termine the busiest times and the software, includ- manpower requirements for those ing one enabling periods. FBOperational can also centralized track- be used to build customer profiles ing of concierge Enterprise and prioritize service delivery and ground ser- times based on arrival and depar- vices, including ture times of aircraft. For flight car rentals and school or charter firms, the sys- catering. A second software... tem includes an aircraft dispatch module, known as feature. a “customer rela- Under current planning, PRG tionship manage- will release a shop inventory/ ment program,” is work order module for both ELS designed to manage and FBOperational by year-end. customer profiles. The third module, ...more economical than a black & white ad. Wellington-Royce totally dedicated Corporation to aircraft manage- Wellington-Royce Corporation’s ment, enables the BASE (Business Aviation Software user to issue up

Engine) System is designed as a to three different complete FBO accounting pack- invoices per charter age, encompassing both POS and trip, depending on the back office. Currently, 400 to how the cost of the 500 customers at 60 to 65 airport charter is separated sites are using the system. Accord- out. MyFBO.com ing to Gloria Barnes, the Atlanta The BASE Sys- software firm’s president, those tem is resident

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Charter arranged in the US by TAG Aviation USA, Inc. is operated by AMI Jet Charter, Inc. or other FAA certificated and DOT registered air carriers. CST #2078988-50. The Continuing Threat of Aircraft Misfueling By Mike G. Mooney What Is Misfueling? Delivering the incorrect grade of fuel into an aircraft is termed a “misfueling.” Most general aviation aircraft and some aircraft used by airlines are fueled by the gravity or “over-the- wing” method, and therefore the nozzles for either avgas or jet fuel may fit into the fuel tank opening. This creates the significant risk of a misfueling. Continued on page 36

Aviation Business Journal | 3rd Quarter 2006 35 Aircraft Misfueling Continued from page 35

What happens when an aircraft similar looking aircraft in opera- mittee for review and adoption. engine is misfueled? The serious tion around the world, visual ap- Once published, we hope that this consequences of misfueling vary pearance alone cannot be relied document becomes the industry based on the grade of fuel and the on to identify which grade of fuel standard for aircraft misfueling engine type, but here are some the aircraft requires. prevention. examples: • Total engine failure due to The Diesels Elements knock damage if jet fuel is deliv- Are Coming of a Misfueling ered into a spark-ignition piston To complicate matters, greater Prevention Program engine powered aircraft that numbers of diesel-powered requires avgas. The key elements of effective aircraft are now being manufac- misfueling prevention should be • Ignition failure if avgas is deliv- tured, and in some cases existing ered into a compression-ignition adopted into the standard practic- aircraft with spark-ignition piston [diesel] piston engine powered es at all fueling operations. These engines are being converted to aircraft that requires jet fuel. elements include: diesel engines. Aircraft fitted with • Vapor lock and engine failure • Training, diesel engines are very similar in due to fuel starvation if avgas is • Grade Confirmation, delivered into a turbine engine appearance to aircraft fitted with • Written Fuel Order Forms, powered aircraft that requires spark-ignition piston engines, • Grade Decals for Aircraft and jet fuel. Many turbine engines making visual identification very Fueling Equipment, are capable of operating on av- difficult. In addition, the filling • Selective Nozzle Spouts, and gas, but such operation is strict- ports on modified aircraft may not • Fuel Receipt Quality Control ly controlled as described in the have been replaced with the larger Procedures. Pilot Operating Handbook. diameter airframe fueling port as- Training Is Key sociated with aircraft requiring jet If an avgas powered aircraft is fuel. The consequences of fueling Root cause investigations in the inadvertently refueled with jet these aircraft with avgas can be aftermath of aircraft misfueling fuel, there can be sufficient avgas (as well as a majority of other inci- catastrophic. remaining in the aircraft’s fuel dents) have identified insufficient lines and carburetors to enable An Industry Standard training as an all too common the aircraft to taxi, run up, and cause. A very basic rule for all Clearly there is a need for a com- even take off. When the jet fuel aviation businesses should be: reaches the engine, often at a criti- prehensive set of procedures to cal time during the takeoff, the address the many possible causes All employees providing any kind of engine can fail and cause a forced of misfueling. To address this service for anyone shall have docu- landing or worse, a crash. need, an API/IP Aviation Fuel mented training using an approved Subcommittee, whose members training program administered by a What Went Wrong? include John Thurston of Air BP qualified instructor. In analyzing the documented and Martin Tippl of Exxon-Mobil, The documents to support cases of misfueling, a variety of are currently drafting a recom- proper training should include: causes were identified, but the mended practice document en- • Copies of written exams (with leading cause was lack of grade titled “Procedures for Over Wing passing scores), and confirmation, meaning that the Fueling to Ensure Delivery of the • A sign-off for each of the neces- fueling staff did not confirm with Correct Fuel Grade to an Aircraft.” sary skills by a qualified instruc- the customer the grade of fuel Once the draft is completed, it tor signifying that the student required. Because there are many will be sent to the full API com- demonstrated they were compe- tence in performing that par- ticular service safely. The Look-alikes The NATA Safety 1st program is • Piper Mirage [avgas] and Piper Meridian [jet fuel] superb on this documentation as • Cessna 404 Titan [avgas] and 441 Conquest [jet fuel] it contains the forms to document • Twin Commander 580 [avgas] and Twin Commander 690 [jet each service. However, in some fuel] cases we have found that it was not filled out and the application

36 Aviation Business Journal | 3rd Quarter 2006 Get�SPCC�"P e a ce �o f�M in d " for Safety 1st certification was never sent to NATA. Recurrent training should be U n a tte n d e d �S p ill? done based on intervals (annual, U n a tte n d e d �S p ill? semi-annual, etc.). For refresher training, the simple act of casu- ally observing employees perform their job can result in an accurate ��aa��PP ro ro b b le le m m assessment of their skills. If you NN o o t t ��DD ra ra in in ! ! see that the job is not performed ��SS a a fe fe correctly, submit that employee ww ith ith for some refresher training. The dates and results of these follow- up observations and any training •• 100%100% AboveAbove GroundGround SecondarySecondary provided should be recorded in the employee’s training record. ContainmentContainment All personnel must clearly •• EasyEasy "Drop"Drop In"In" InstallationInstallation understand the consequences of •• StainlessStainless SteelSteel ConstructionConstruction any lapse in maintaining correct procedures. I call this deliver- •• StormwaterStormwater FiltrationFiltration ing the “what’s in it for me.” The •• SpillSpill ControlControl consequences of a misfueling •• EasyEasy SpillSpill CleanClean UpUp are deadly serious, therefore it is essential that personnel are fully •• QuickQuick Open/CloseOpen/Close ValveValve trained to undertake over-wing fueling of aircraft to prevent mis- fueling. Training staff should develop a C u s to m �b u ilt�to �fit�a n y �s iz e written, risk assessed job task that contains a step-by-step proce- tre n ch ,�s q u a re �o r�ro u n d dure on how to over-wing fuel an aircraft. This job task should also address health and safety issues and any legally required personal protective equipment required when performing such work. Training aids such as posters or bulletins describing the require- ments of misfueling prevention and other safety subjects should be located on walls, doors, and bulletin boards to remind refu- eling staff to remain vigilant in preventing misfueling. Grade Confirmation Is Essential When taking a verbal fuel order, the requested fuel grade should be repeated back to the customer SAFE �D R A IN ,�2 9 8 5 �G o rd o n �A ve .,�S a n ta �C la ra ,�CA �9 5 0 5 1 � to ensure confirmation. Whether verbal or written, all fuel orders Toll�Free:�1-888-428-8886,�www.SafeDrain.com Safe�Drainô �is�a �pa te n te d �pro d uct� (Pa te n t�N umb e rs:�5 ,3 8 3 ,74 5 ,�5 ,5 8 2 ,72 0 ,�5 ,72 8 ,2 9 4 )�a n d �is�pro te cte d �b y�o the r�pa te nts�and�patents�pending. Continued on page 38

Aviation Business Journal | 3rd Quarter 2006 37 Aircraft Misfueling Continued from page 37 must include confirmation of the If you are working personally “50 a Side with Go grade of fuel required. Essential with a customer, receive an over- Juice Please” information in a fuel order is: wing fueling verbally, and plan to Using standard product names • Fuel grade, complete the fueling immediately, when referring to aviation fuel • Quantity of fuel to be delivered you won’t need to write up the or- products is important to avoid into each fuel tank, and der, just verbally confirm the fuel confusion. Customers often use grade. In all other instances, the • Aircraft registration. unusual or abbreviated product order must be written after being names, which can lead to confu- Pilots commonly request “200 verbally received from the pilot. sion. This is particularly apparent a side” or “top it off,” without The recording of verbal orders specifying the fuel grade required. where customers have operated and their accurate transmission internationally. For example, Again, it is critical to repeat the from one person to another are order back to the customer and in Spain the local name for jet critical in ensuring that the cor- fuel can be “petroleo,” which is have them confirm the grade rect fuel grade and quantity are very similar to “petrol” as used required, as in “Is that 200 gallons delivered. Meter tickets and other for gasoline (more like avgas), in of JetA a side?” or “Is that a top-off documentation used routinely to many countries. Some pilots may with Avgas 100LL?” (Ideally, the initiate normal fueling or billing use only one grade of fuel in their employee asks this while handing processes are not written fuel fleet and may not be aware of the the customer the now-written fuel order forms as they do not docu- importance of grade confirmation. order and asking him or her to ment the confirmation of the fuel When orders are received from sign it as confirmation.) grade. customers (or from instructions

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38 Aviation Business Journal | 3rd Quarter 2006 relayed via other staff members) that do not use “standard” prod- uct names, you must clarify the grade. Orders such as “aviation fuel” or “gasoline” have the poten- tial to cause the delivery of the incorrect grade of product. Fuel Grade Decals All aircraft owners should fit fuel grade warning labels to the over-wing refueling ports of their aircraft. These labels are provided free of charge by fuel dealers and provide the best warning to the line staff of the fuel grade the aircraft requires. The fueling equipment should have fuel grade decals on all four sides. Many operations have placed fuel grade Continued on page 40

Are You Nozzle Savvy? Do you know which nozzle should be used on your aircraft and why? All avgas-powered aircraft with over-wing fueling ports should have an opening smaller than 2 inches. FAA-mandated restrictor plates are available for larger openings.

Avgas Nozzle Jet Fuel Nozzle (1-inch spout) (J-spout)

1 1 2 /2-inch oval spout. The intent is that the 2 /2- inch J-spout for jet fuel will not fit into the tank opening on an avgas-powered aircraft fitted with the restrictor plate.

The Rogue Nozzle (straight spout)

1 Jet fuel nozzle, 1 /2-in spout. Be on the lookout for jet fuel nozzles fitted with this spout. It will fit into an avgas aircraft even with the restrictor plate. These should not be installed on jet fuel nozzles.

Aviation Business Journal | 3rd Quarter 2006 39 Aircraft Misfueling Continued from page 39

decals on the inside of the vehicle’s windshield (at so that they will not have to bother with switching the top so it won’t block the driver’s view). That nozzles for a relatively small number of aircraft. way drivers can see the grade of fuel the vehicle Convenience will not be a very convincing argu- carries as they approach the aircraft. ment in court if you remove the industry standard misfueling prevention device! No Decal, No Fuel We recommend that the rogue nozzle spout be A policy should be established that line service kept in the care and custody of a supervisor. If it is personnel only refuel aircraft that are properly fit- needed, the supervisor can confirm the need (by ted with appropriate fuel grade identification that confirming the fuel grade and tank opening size) matches the fuel grade on the refueling equipment then issue the rogue nozzle and ensure its prompt they intend to use. In cases where no such identi- return. fication is visible on the aircraft, employees should have a completed fuel order form before proceeding Fuel Receipt Quality with the fueling. Control Procedures The worst scenario in a misfueling is gross fuel The “Rogue” Nozzle contamination upstream in the fuel supply system. Close control and access of the “rogue” nozzle spout Most fuel suppliers take careful measures to ensure (see sidebar on page 39) is critical in an effective that only clean, dry, on-spec product is delivered to misfueling prevention program. In case after case airports. However, if this product is delivered into we have found FBOs that have removed the J-spout the wrong tanks, it will contaminate the fuel in the and installed the rogue nozzle spout permanently. tanks. If this contaminated fuel is not discovered We ask them why they would remove such a criti- and reaches an aircraft, the consequences could be cal item, and they usually say “because we fuel deadly. some aircraft (usually helicopters) that the J-spout Adherence to established fuel receipt quality won’t fit into.” So they risk misfueling avgas aircraft checks is the best defense against this kind of mis- fueling. Key elements include: • Testing the gravity of the fuel and ensuring that it is within acceptable tolerance limits when com- pared to the accompanying certificate of analysis, and • Conducting a visual inspection of the fuel to en- sure it is the appropriate color. Once the fuel grade is confirmed and other qual-

ity control checks are acceptable, the use of grade selective couplings at the point of connection on the fuel farm where the road transports off-load will help prevent the wrong grade of fuel from being delivered into the storage tank. Also, the grade se- lective connectors must be used to transfer prod- uct into the refuelers to prevent the loading of the incorrect grade of product into fueling vehicles. Working Together Aircraft misfueling is a continuing threat in our industry, but by working together to ensure that appropriate preventative measures are followed, we can help stop aircraft misfueling altogether. The wrong fuel grade can be deadly, so when it comes to fuel grades, never speculate. Always make sure.

Mike G. Mooney is with Air BP Aviation Services. Special thanks to John Thurston of Air BP and Martin Tippl of Exxon-Mobil for their contributions to this article.

40 Aviation Business Journal | 3rd Quarter 2006

Making Your Business Fly in Cyberspace

Internet Marketing Continued from page 39

Part 2 in a Series of Articles on Successful Internet Marketing By Dan Kidder

veryone in business knows they have a passionate love for the you chomp at the bit, dig in your what it takes to succeed, how goods or services they offer. This heels, and won’t budge an inch to meet the bottom line while is truer in aviation than almost to utilize what can be an easy, Ekeeping the overhead low, and any other industry. inexpensive, and practical tool to most importantly, how to suc- The unfortunate reality is that market your business. cessfully market their services once a person begins to provide and products to their customers. services or goods in their be- Why Have a Website? Everyone in business has to know loved industry, they tend to get We have discussed this topic in this because, after all, everyone so bogged down in the day-to-day previous ABJ articles, so I won’t in business has an MBA, is an business operation, marketing, till that ground again, other than expert in marketing, and most personnel, accounting, facilities to restate the most important importantly, has a full-time staff management, etc., that they sel- aspects. Websites provide an inex- pensive way to reach customers, dedicated to selling and market- dom get to work in the areas they are easy to update and change, ing their products and services to really enjoy. give you the means to provide each and every potential client What if I told you there was a your customers with vast amounts in the marketplace. True or false? way to free up some—not all but of information without tying down Please show your work. some—of your time to pursue a sales staff to answering basic Of course the above statement the aspects of your industry that questions, and make your busi- is blatantly false. Few business originally drew you into it in the ness vastly more competitive than people go into their chosen mar- first place? Would you be inter- similar operations that do not ket because they are general busi- ested? Of course you would. You have a website. ness experts. Those who choose would run like a mad horse to The problem most small to a particular line of business do so learn more. However, the second medium-sized businesses face is because they are experts in their I tell you that a successful website that they understand this, have industry or, more often, because is just the key you need, many of a website, and haven’t seen the

4242 AviationAviation Business Business Journal Journal | 3| rd3 rdQuarter Quarter 2006 2006

results I have so flippantly prom- your website appears in the list- a brief form, electronic robots ised. “Alright Bub, if it is so easy, ing. called spiders or META crawl- inexpensive, and efficient, why ers, will visit your site, pull your aren’t the customers beating down Searching, Searching, keywords, and add them to their the door?” you ask. Because there Searching—12 Million database. Additionally, Yahoo! is more to successful web market- Matching Sites and many other search engines ing than just having a site. The first step in ensuring that are driven by a publicly edited your site is appearing is going to database called the Open Director What Good Is a major Internet , Project, Directory , www. a Website If No such as Google or Yahoo!, and .org. Once your website is One Can Find It? testing typical search terms that submitted to one of these search Any business presence in cy- you expect a customer might use. engines using the ODP, it is berspace must have some key If you can’t find you, neither can simultaneously submitted to the elements in order to be found they. hundreds of other search engines amongst the tens of millions of META tags are text headers on in the DMOZ. These include AOL websites on the your website that utilize a descrip- Search, Yahoo!, , and many and the millions of websites that tion and keywords that a search others. This still won’t make you offer similar services as your busi- engine pulls when searching for pop to the top of the list, but it ness. Just as you spend time and matches to a site. Your site must does put you on the cyber map, so energy to ensure that your signs have these important elements to to speak. and marketing materials shine, come up in a search. Google-powered websites use Just sticking the META tags in similar attention must be paid to Continued on page 44 your website. the header of your website is not Fear not, intrepid web warrior, sufficient. You then there is a toolbox filled with equip- must make sure ment to make this process quick that the search en- and relatively painless. gines know to look at your site, add Get the Word Out! your web address The first key to promoting your to their database, API/IP 1581 5th Edition website is ensuring that every and cross index it piece of marketing material prom- to your keywords. inently displays your web address: This sounds compli- your business cards, brochures, cated, but it really email signatures, signs, aircraft, isn’t. tugs, and even painted on the tar- Some services mac next to your tower frequency. charge hundreds Your current customers will learn of dollars to do where can they reach you, and what I am about to Ve l ocity Control they can easily forward your in- tell you how to do is Our Name, formation to others they feel will for just about one Jet Fuel Filtration benefit from your services. hour’s work. Most is Our Game. Make sure that any directories, search engines charts, listings, and advertise- have the ability to ments prominently display your submit your site to website. The NATA member on- the search engine line directory at www.nata.aero is database. Once you a searchable database that poten- have done this, VELCON FILTERS, INC. tial customers use to find service usually by click- COLORADO SPRINGS, CO, USA providers in their area. Visit the ing on the “submit” 1-800-531-0180 • FAX (719) 531-5690 or “suggest URL” site and make sure your company VISIT OUR WEB SITE AT: www.velcon.com information is correct, and that link and filling out

Aviation Business Journal | 3rd Quarter 2006 43 Internet Marketing Continued from page 43

a completely different algorithm included in the search text. This click can range between 8 and 50 (mathematical formula to desig- process is known as text optimiza- cents per click. Once your budget nate actions) to catalog sites and tion and is the single most impor- has been maxed out, your ad no return results. While you can still tant key to ensuring high listings longer appears for that day. manually submit a site through in search results. It is also the Ad Words gives you tremendous Google, the world’s most popular single greatest reason that your flexibility to track and modify and most accurate web database web content needs to be thought- your keywords to make sure that doesn’t care about your META fully constructed and carefully those who click on your ad are tags. In Google, content is king. crafted. Do not just dump your actually interested in your service. To move up the list of search brochure text onto your website! It will suggest similar keywords results, you must ensure that your for terms you provide, tell you in website has text relevant to the Google Ad Words detail how many clicks you are search query from the potential To provide an added edge to getting based on which keywords customer. You must understand your search results, advertise return results, and provide sug- what is meant by “text.” Text must your site. This can be done very gested changes to your site to help be information actually formatted inexpensively through services you better optimize your text to into the site’s hypertext markup such as Google Ad Words. Basi- return valuable results. This can language. Google’s spiders do not cally, you set a monthly bud- cost as little as $10 per month or get that Google divides into an crawl animated Flash elements, as much as you want to spend. average daily budget. You select portable document format (PDF) Obviously, if a $30 per month a series of keywords you think files, attached Microsoft Word expenditure results in just one your customer might type when additional $10,000 charter or an files, or anything other than the looking for your services. Each increase in the sale of even 200 native code that makes up your time a web surfer types in one extra gallons of avgas, then it is a site. of those strings of search terms, Because content is king, it is not your ad appears at the top of the well-made investment. only imperative that the text of list under “Sponsored Sites,” until Make no mistake, there is a your site provide cogent material you have reached your average steep learning curve on Google for your viewers but also that any daily budget. You are charged only Ad Words, but the company pro- possible search string you can when the surfer actually clicks on vides many helpful tutorials to conceive your customers using be the link to your site. Charges per guide you through the process, and once you have mastered the pro- cess, your site will be a Cyber Megalith to be reckoned with. Additionally, the increased traffic will cause your non-spon- sored link to move higher in the search results, as relevance is another aspect used by Google to determine search result standings. Be- cause Google is the number-one search engine in the U.S. and even has been added to the Oxford English Dictionary as a term for searching

44 Aviation Business Journal | 3rd Quarter 2006 the Internet, it is well worth the There are several tools available ports on when visitors are hitting investment to make your site as for web monitoring and analysis, your page. Combining this data Google-friendly as possible. and each has it own benefits and with Google Ad Words lets you set Additional Google tools let you shortcomings. your ad to appear only during the add search capability to your web highest traffic times to your site, content, monitor web traffic, ana- Google Analytics making it more likely that your lyze and maximize content, sell Packaged with Google AdWords, customers will find you when goods, and much more. Analytics is another valuable tool. they are typically searching. It provides detailed breakdowns of Check Your Charts! how users find your site, how long WebTrends Websites allow you to quickly and they stay, what they look at, and WebTrends (www.webtrends. efficiently post and modify con- what they do with what they find. com) provides a suite of analysis tent, which unbelievably is often It also lets you see where in the tools to let you truly monitor and the most underutilized benefit of country they are coming from. maximize web traffic. Detailed the medium. Far too often, busi- graphics, minute-by-minute break- nesses post content on their site Webalizer downs, and automated reporting and put it on autopilot. To take full A stand alone application, Webal- are some of the unique features. advantage of this fluid medium, izer (www.mrunix.net/webal- Fortune 500 companies use this you must monitor how people are izer) provides similar analysis as tool to monitor their multi-million finding your site, and alter the Google Analytics, giving you the dollar websites, and it can be as content to maximize the number ability to break down web visitors simple or complex as you want it of visitors who find useful infor- in a variety of fashions. Webalizer to be. WebTrends can also work mation about your business. also allows you to see detailed re- Continued on page 46

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Aviation Business Journal | 3rd Quarter 2006 45 Internet Marketing Continued from page 45

as a consultant for your business capitalize on them. For example, addresses, web addresses that are and make sure that all the work is if people from regions you had too long, and mid- or bottom-level done for you on a contract basis. never considered begin visiting domain names all decrease your your site and purchasing your website effectiveness. Take the Stick! goods and services, modify your An example of a mid- or bot- As the old G.I. Joe cartoons used external marketing to tap into that tom-level domain would be to remind us, “Knowing is half the customer-rich region. something like, www.comcast. battle.” In the battle for control of If you see that customers are net/joespages//aviation/abcjet- the Internet, or at least our little hitting your site and immediately fuel/index.. A key rule is that piece of it, the other half of the leaving, provide content that will if you can’t remember your URL, make them stick around and come battle is taking the stick in hand you can’t expect that customers and maintaining control of our back often. You could add live weather for your region, updated will. Use online tools, such as site. It is not enough to leave the Network Solutions (www.nsi.com) site on autopilot, letting it run day fuel prices, Jeppesen charts for domain name lookup or GoDaddy in and day out with outdated con- your airport, aviation news, inter- (www.godaddy.com) to purchase tent, lack of relevance to custom- esting trivia, etc. Be creative and a domain name that reflects your ers, broken links, attached docu- keep them coming back. business. ments that haven’t been viewed Location, in ages, etc. The content must be Another key is using the new clean, fresh, and functional. Location, Location “.aero” extension, which is avail- Now that you have tools to Just as any aviation business able only to aviation organizations analyze your content, you must would be foolhardy to locate in and businesses, to differentiate take that knowledge and use it a train depot, where you place your business as a purely aviation to modify your content accord- your website in cyberspace has business. That way, customers ingly. Once trends start appearing tremendous impact on how effec- searching for Joe’s Fuel will im- in your analysis, steer the site to tive it will be. Hard to find web mediately be able to tell that your business sells aviation fuel, as opposed to Joe’s Filling Station in Baton Rouge that sells gasoline. (Yes, even Joe in Louisiana has a web- site these days.) The extension also allows you to purchase do- main names that aren’t available with a .com extension that you have always wanted to own for your business. Contact NATA’s com- munications depart- ment for information on getting an .aero extension. A top-level domain makes your site easier to find and also sends a subtle message to your customers that they are dealing with a professional enter- prise. Another benefit

46 Aviation Business Journal | 3rd Quarter 2006 Checklist

✔✔ Do - Have a website ✔✔ Do – Have a top-level domain ✔✔ Do – Update it often ✔✔ Do – Analyze traffic and adapt your content ✔✔ Do – Market your site ✔✔ Do – Have interesting content such as local weather information and links to national aviation weather on your site ✘✘ Don’t – Leave your site on autopilot ✘✘ Don’t – Think that your site will replace your other marketing efforts ✘✘ Don’t – Have a generic email address ✘✘ Don’t – Ever consider your website finished is that it provides you with top-level domain email addresses, [email protected], as opposed to [email protected]. This tells customers that you are a top-notch operation worthy of their business. Most of the information we have discussed lays a groundwork for a successful web marketing strat- egy. Obviously a plethora of companies provide consulting on these issues, and libraries are filled with tomes on how to make your website work for you. This article isn’t intended as a comprehensive resource on this issue but rather aims to familiar- ize aviation businesses with concrete steps they can take to maximize exposure for their enterprise. Think about how your website presents your busi- ness and discuss options with your webmaster to integrate these solutions into an effective web campaign. The difference you see may not be im- mediate, and some tweaking will be required, but in the long run, these tools and steps will generate tangible results for your bottom line.

Next Issue: Checkride Your Content — How the Lack of Killer Content Can Kill Your Site

Dan Kidder is President of Kidder Communications, an Arlington, Va.-based communications consulting firm that specializes in small and medium-sized business marketing and political consulting. For more informa- tion, go to www.kiddercom.com or email dkidder@ kiddercom.com.

Aviation Business Journal | 3rd Quarter 2006 47 AviationBusJourn.corpNJs 6/14/06 2:01 PM Page 1

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afety is always top priority.” You often 1. Our company has a documented, comprehen- hear this slogan bandied about and see sive, company-wide safety plan for identify- it on those slick workplace posters, but ing and managing risk that is distributed to all could this expression really be the biggest employees and is regularly updated. myth in aviation? Let’s think about it for 2. Our CEO or other accountable executive takes a moment. The very definition of the responsibility for implementing the safety plan word“S “priority” requires that we evaluate compet- and ensuring its success. ing alternatives. So, calling safety a priority means 3. Safety starts at the top in our company and is it will change based on the needs or urgencies of routinely emphasized as a core value. the moment, such as trying to please a demanding customer or the boss to meet a schedule. 4. Our company safety policy clearly states that Admitting we might not always put safety first any employee can report a safety issue without doesn’t mean we deliberately intend or want to be fear of retribution. unsafe. But if we don’t have a logical, orderly pro- 5. Our company safety policy is articulated in all cess written down for everyone to follow, coupled company documents, such as operations and with a firm management commitment, safety can maintenance manuals, employee handbook, easily take a backseat to the bottom-line or the lat- standard operating procedures, etc. est crisis du jour. 6. Our employees are rewarded for “doing the “Of course safety is first in our company; we’ve right thing” where safety is concerned. never had an accident,” you might be thinking. 7. Our company has a safety manager who reports This is the traditional response to the “Are we safe?” directly to the CEO or accountable executive. question. While it’s definitely a point of pride, the lack of accidents isn’t the only way to measure your 8. Our safety manager is considered a resource company’s safety performance. and facilitator, not someone to blame when The aviation industry has learned through the things go wrong. years that it’s cold comfort to go about fixing prob- 9. Our company has a safety committee, com- lems after a tragedy has occurred. We have instead prised of representatives from each depart- started to embrace a systematic approach to safety, ment, that meets regularly to get ahead of or systems safety, as a result of lessons learned. safety issues and when special needs arise. The late Jerome F. Lederer (who championed sys- 10. We routinely communicate safety issues and tem safety in aviation and space flight) described provide feedback on safety concerns to our system safety as, “Organizing to put your hindsight employees. where your foresight should be in the identification So how did you fair? Were you able to confidently and management of risks.” and positively confirm that all ten areas are com- Risk identification and management are the core pletely covered and documented in your company? of the system safety process. For this process to If not, conduct an honest assessment of your opera- succeed, the company must have a strategy, top tion to determine where the gaps are. Develop an management’s commitment to the process, and full action plan and start the process to ensure you have company participation. Safety must be considered a a systematic approach to managing risk. It won’t value, not a priority, in the organization. happen overnight, but with company commitment, With Lederer’s sage words and a process in mind, it will be an evolutionary process. At some point here are ten points to evaluate whether your com- you’ll be able to truthfully say, “Safety is always pany truly puts safety first. first in our company.”

Aviation Business Journal | 3rd Quarter 2006 49

SAFETY WATCH

News

The Eye-Opening Aviation Expert Lawton Joins SMS Ground Experience NATA Safety 1st Team ATA’s Safety Management System (SMS) viation safety expert Russ Lawton has joined NA- Ground is reaching maturity with some partici- TA’s Safety 1st Program as director of safety and pants completing their manuals and many in security. Lawton has held key safety positions as Nthe midst of completion. Many safety coordina- Aan experienced charter operations advocate over tors have told us that the journey is an eye-opening the past three decades in aviation. Joining Amy experience that gives them an appreciation for a Koranda on the Safety 1st team, he brings a depth system to better manage safety at their operation. of safety expertise to NATA’s SMS Air Operations. SMS participants are very vocal about the SMS be- Lawton holds a master’s degree from the Univer- ing more than a book on the shelf—it is a living, sity of Southern California and a bachelor’s degree breathing document born of sweat and pride. from the Florida Institute of Technology. He is also As ground participants experience safety aware- an active Cessna 210 owner and pilot. ness, they have come to realize not only the need, Full details on Lawton’s background are available but also the desire, for guidance on best ramp on the pressroom section of NATA’s website. practices. The Safety 1st team, with the assistance Safety Watch continued on page 53 of SH&E and NATA’s Safety & Security Committee, has begun to develop the best procedures as well as alternatives to assure safe practices from the small- est to the largest ramp. NATA’s Safety 1st eToolkit provides guidelines for selecting the appropriate chocks for ramp use (Go to www.natasafety1st.org.) With guidance from NATA members and the committee, we will continue to provide the best ramp practices for any size FBO.

SMS Web Casts: Similar Challenges, Shared Solutions ach month, safety personnel participate in SMS manual guidance and development through web casts taught by our safety experts. Participants Ereceive email invitations to join one of eight web casts (all eight continue every month), which require Internet access to view presentations and a telephone connection to listen. SMS participants call the web cast assistance right on target, as the presentations provide enlightened guidance while the discussions with others along this journey prove invaluable. Knowing that oth- ers experience similar challenges is half the battle, but sharing solutions with others, including safety experts who offer advice, jump starts the safety process. If you are looking to bolster your safety program through a systematic approach, go to www. natasafety1st.org for a monthly web cast schedule.

Aviation Business Journal | 3rd Quarter 2006 51

Safety Watch Continued from page 51 SMS Workshops: SMS 101 Updates for SMS Air Operators and Manual Development he FAA issued Advisory Circular (AC) No. 120-92, aking the first step along a journey is sometimes Introduction to Safety Management Systems for Air the most difficult. The Safety 1st team and the Operators, dated June 22, 2006. NATA has up- FAA will hold regional seminars across the na- Tdated its SMS for Air Charter Guide to align with the new FAA AC as well as international standards tion to demystify safety management systems T and guidance materials. NATA SMS participants will and answer your questions about what an all-inclu- receive the updated version of the enhanced guide, sive safety system can do for your operation. The including the new name, NATA Safety 1st Manage- first of these seminars, which begin in late Septem- ment System for Air Operators. ber, will be held in the New York City area. Check To find out more about the NATA Safety 1st the NATA website for dates and locations. Management System for Air Operators, go to www. Beginning this fall, the Safety 1st team will also natasafety1st.org. hold a series of one-day workshops to assist NATA SMS participants with SMS manual development and completion. The workshops are for those begin- New PLST Developments ning the process as well as those who have begun, Are around the Corner and they include a day spent one-on-one with ATA’s Safety 1st Team has been reviewing the safety experts devoted to manual start/comple- best means to provide online training for our tion. All SMS modules will be discussed in-depth PLST participants. After many discussions with and template sharing will help with safety manual our oil company partners, the NATA Safety & implementation. The workshops are designed to N NATA-151 AMCG Ad (1/05) p 1/31/05 3:58 PM Page 1 Security Committee, the NATA Board, and many supplement the web casts and other program guid- top-notch online providers, we are pleased to an- ance. nounce that we are in the final stages of choosing When the workshop schedules are firm, an- an online delivery system. We will share the news nouncements will be made to NATA’s membership through NATA eNews and the NATA Safety 1st in the eNews, eTookit, and Fitebag newsletters. eToolkit when the final details are confirmed. and creativesolutions and ■ thoroughly understanding the needs and exceeding the expectations of our clients ■ keeping our clients fully informed ■ providing innovative Results You Can Count On Aviation Management Consulting Group is a results oriented firm specializing in the general aviation industry. Over the years,we have worked with fixed base operators (from small independents to large international corporations),aviation ■

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Aviation Business Journal | 3rd Quarter 2006 53 NATA Announces New Financial Benchmarking Service for Members n the fast-paced aviation industry, you need up- The web-based service is easy to use and is to-date financial trends on your company and updated each time NATA members upload their fi- comparative benchmarking analysis to make nancial information. You will be officially invited to informed business decisions. As such, NATA has participate later in the year, but we want to provide partnered with the iLumen Financial Informa- you with a sneak peek of what’s to come. tion Network to provide its members with access The iLumen Financial Information Network is Ito industry analysis and benchmarking trends for a community of thousands of private companies the aviation industry. The service will enable mem- in all major industries. These companies anony- bers to answer key questions every month, quarter, mously contribute financial information, which and annual period as they close out their account- drives industry-specific analysis and comparative benchmarking trends easily viewed by business ing books: owners and managers. Your trusted financial advi- • Did the business grow as fast as others in the sors (accountants, bankers, consultants, etc.) can be industry? enabled on the service with your permission. • How do my margins compare in each of my profit centers? Benefits for NATA Members • Are our costs in line? • For key productivity measures, are we achieving NATA believes that this benchmarking service will efficiencies in line with others that are the same provide members with the following benefits: size? • Easy way to upload and analyze your financial information, • Financial and non-financial metrics displayed on industry-specific dashboards, • Benchmarking trends that allow you to com- pare your financial performance to peers in the aviation industry, sorted by geography and size ranges, • Real-time access through a secure NATA branded website, and • A more complete understanding of your financial position every month. The aviation industry is a uniquely complex service industry with many moving parts. With this service, you can view how your company is trend- ing overall and then drill down to individual profit centers such as fuel line services, charter services, maintenance, flight training, and airline servicing. You can then compare your performance to other members, sorted by company size and geography, to have a true picture of how you stack up. You can also spot trends in the industries of your customers and suppliers that could affect your business.

Key Metrics for the Aviation Industry • Fuel Gross Margin % • Service % Revenue • Profits Before Depreciation • Facilities Rental Revenue per Square Foot • EBITDA %

54 Aviation Business Journal | 3rd Quarter 2006 contributed from private compa- nies. It accepts financial data from ABC Aviation Inc. - August 2006 Period Manager Company Dashboard Benchmarking all accounting software packages August 2006 Company Dashboard Print as Report and does not require any changes Financial Metrics: (Click a Financial Metric from the list below to view its chart) Dashboad View NATA

Same Pd Same Pd Rolling Last Avg Growth to your chart of accounts. The Ye ar-to-Date YTD Last Year Current Period Last Yr 12 Months Fiscal Yr Rate T o tal Revenue $15,913,877 $12,778,593 $1,894,191 $1,256,214 $17,190,723 $14,055,439 19.53 data are standardized, frequently Fuel Sales $2,275,438 $1,190,688 $333,883 $152,445 $2,792,556 $1,703,806 61.01 Fuel Sales % Revenue 14.30 13.73 updated, and do not include any Service Sales $219,550Select Data Series$17,521 Yearly$51,301 Trend $4,883 $295,169 $93,140 950.60 Service % Revenue 38.54%� My Company 42.85% 37.34% 42.80% 38.84% 42.01% (12.75) Gross Profit �3.71%Industry Median 0.63% 5.74% 1.37% 4.10% 2.30% 318.97 third-party sources. iLumen has Fuel Gross Profit (%) Gross Margin % $324,185Industry Average$92,062 $65,716 $12,539 $423,348 $191,225 424.09 Profit Before Depreciation % 57.61 51.92 42.4050.00 % 34.16 38.03 51.92 24.10 Industry Median formed partnerships with banks, Profit Before Depreciation Select14.14 Metrics 15.54 10.1945.00 % 10.19 10.19 15.54 0.03 EBITDA 46.80Income Statement47.17 Metics 33.7340.00 % 31.16 31.57 47.17 8.23 Total Revenue 35.00 % accounting firms, trade partners EBITDA % 4.37Gross Margin % 2.72 4.37 2.72 3.59 2.79 51.90 30.00 % Days Sales Outstanding 8.07Operating Expenses4.03 / Revenue (%) 2.49 3.99 2.87 4.03 (37.51) SGA / Revenue (%) 25.00 % Fuel Inventory (DOH) 20.00 % and industry associations to Operating Margin % Revenue per Employee Net Margin % (before tax) 15.00 % Net Margin % (after tax) 10.00 % EBITDA deliver their services to private EBITDA % 5.00 % Cash from Ops / Revenue (%) 0.00 % COGS % companies. Cash Flow Metics Ratio Metics Year 2001 Year 2002 Year 2003 Year 2004 Year 2005 NATA members will hear more about this service in the coming months. An annual subscription to the network is $395. What NATA Members Are Saying Dale E. Froehlich, president and CEO of Business Learn more and Aviation Services, and Bill Greenwell, general manager of Frederick Aviation, recently discussed sign up online via how using NATA’s benchmarking service will impact their businesses and the aviation industry. http://nata.imonitor.net. Common themes included having a better under- standing of their current financial situation, the importance of comparative industry benchmarking, and the difficulty of explaining their complex busi- nesses to people outside of the aviation industry. “The diversity of NATA’s membership represents some unique challenges that this service addresses, namely being able to handle the various ways we keep our books without us having to do any addi- tional work,” Froehlich said. “iLumen will help us take the financial information we currently have and make it much more useful. This will keep us more accountable on a monthly basis. And hav- ing access to comparative industry benchmarking trends will give us valuable insight into our busi- ness and industry that we’ve never had before.” “I see three areas being positively impacted by us- ing a service like this,” Greenwell said. “First, being able to view and compare our financial trends ev- ery month will help us better identify opportunities to grow our business throughout the year. It will also help us to better communicate our financial position to people unfamiliar with the complexity of our industry, specifically bankers. Lastly, I think this initiative will help quantify the aviation indus- try and give us more visibility when NATA repre- sents us on legislative and regulatory matters.” How Does It Work? The NATA/iLumen service is comprised exclusively of private company financial data anonymously

Aviation Business Journal | 3rd Quarter 2006 55 Air BP Aviation Services Avfuel Corporation ChevronTexaco Global Aviation ConocoPhillips Company ExxonMobil Aviation Landmark Aviation NetJets SevenBar Enterprises Signature Flight Support TAG Aviation NEW NATA MEMBERS

Associate Members • St. Joseph County Airport Authority • Corporate Fleet Services • FlightLine First John Schalliol Thomas McLune Pierre Villere • Airport Property Specialists, LLC Executive Director President 1105 Philip Street John Meyer 4477 Progress Dr. P. O. Box 19589 New Orleans, LA 70130 Designated Broker South Bend, IN 46628 Charlotte, NC 28219 504/616-6270 14605 N. Airport Drive, Suite 210 574/233-2185 704/359-0007 fax: 504/304-8799 Scottsdale, AZ 85260 fax: 574/239-2585 fax: 704/359-0406 pbvillere@.com 480/483-1985 [email protected] [email protected] fax: 480/483-1726 • HTSI Primus Epic Support Team [email protected] • The Port Authority of NY & NJ • Don Davis Aviation Inc. Bruce Bennett Lanny Rider Nancy Blaisdell Engineering Manager II • Allianz Aviation Managers, LLC Manager, Teterboro Airport PANYNJ President 27052 N. 71st Place William Welbourn 90 Moonachie Avenue 2154 Hwy. 136 West Scottsdale, AZ 85262 Chief Operating Officer Teterboro, NJ 07608 Henderson, KY 42420 480/203-9374 317 Madison Avenue, Suite 1110 201/807-4019 270/826-6000 fax: 480/513-2622 New York, NY fax: 201/296-0499 fax: 270/826-6040 [email protected] 646/472-1400 [email protected] [email protected] fax: 646/472-1459 • Jet Center of Tyler [email protected] • Tipton Airport Authority • Dulles Jet Center Randa Conner Michael Wassel Phil Sweeney General Manager • Bridge Ventures, LLC Airport Manager 23800 Windsock Dr. 209 Airport Drive Gregory Dupuis 81 General Aviation Dr. Dulles, VA 20166 Tyler, TX 75704 Manager Director Odenton, MD 21113 703/996-1201 903/597-1334 534 Cypress Bend 410/222-6815 [email protected] fax: 903/592-2561 Oldsmar, FL 34677 fax: 410/674-9325 [email protected] 813/343-2214 • EARCO Elite Co. Ltd. [email protected] fax: 833/552-1088 Liam Seyfert • L.B.D. Inc. [email protected] Regular Members Manager of Ground Operations Brent DeHart P. O. Box EL-25159 Proprietor • JetOneJets • Air Salvage of Dallas Governors Harbour, Eleuthera, The Bahamas 3300 25th Street SE Sean Vincent Holly Fagan 242/332-3244 Salem, OR 97302 Vice President of Operations Vice President fax: 242/332-3245 503/364-4158 135 Crossways Park Drive 1361 Ferris Road [email protected] fax: 503/763-8722 Woodbury, NY 11797 Lancaster, TX 75146 [email protected] 516/396-1253 972/227-1111 fax: 516/396-1314 fax: 972/227-6176 [email protected] [email protected] • The Hiller Group, Inc. • Aitheras Aviation Group Martin Hiller George Katsikas President President/CEO 5321 Memorial Hwy. 1601 N. Marginal Road Tampa, FL 33634 Cleveland, OH 44114 813/882-3313 216/298-9060 fax: 813/882-4294 fax: 216/298-9068 [email protected] [email protected] Affiliate Members • ATR, LLC Mark Smith • City of Fort Worth Aviation Department Sr. Vice President Mike Feeley 2000 NE Jensen Beach Blvd. Airport Systems Director Jensen Beach, FL 34957 4201 North Main Street The San Francisco Bay Area’s 800/707-5757 Suite 22 fax: 800/707-5757 best airport is in Oakland Fort Worth, TX 76106 [email protected] 817/871-5403 fax: 817/871-5413 • Avantair, Inc. [email protected] Tracy Chaplin Chief Operating Officer • Civil Air Patrol 4311 General Howard Dr. Gordon Odell Clearwater, FL 33762 General Counsel 877/289-7180 105 S. Hansel St., Bldg. 714 fax: 727/539-7007 Maxwell AFB, AL 36112 [email protected] 334/264-7152 fax: 334/265-7152 • Black Canyon Jet Center [email protected] Charlie Ferraro Operations Manager • Salt Lake City Fire Department 1450 Airport Road Martha Ellis Montrose, CO 81401 Captain 970/249-0592 AMF Box 22107 fax: 970/249-9303 Salt Lake City, UT 84122 [email protected] 801/531-4521 fax: 801/531-4514 [email protected]

Aviation Business Journal | 3rd Quarter 2006 57 NEW NATA MEMBERS

• Longtail Aviation Ltd. • PetroValue • Stanford Financial Group Company • Volaeris Aviation, Inc. Martin Amick Peter Coleman Gary Duensing Nathan Crane Head of Flight Operations President Chief of Maintenance CEO Suite 113, MPA Hangar 207 - 17700 Hwy. #10 100 Jim Davidson Drive 4904 S. Power Road, Suite 103-481 St. Georges Parish, The Bahamas Surrey, BC Canada Sugarland, TX 77478 Mesa, AZ 85233 441/293-5971 604/576-0004 281/340-2500 480/988-7224 fax: 441/293-5972 fax: 604/576-0093 fax: 281/340-2515 fax: 480/988-7225 [email protected] [email protected] [email protected] [email protected] • M7 Aerospace LP • Prairie Aviation, Inc. • The Jet Center of Dallas LLC • Wright Bros. Aero James Kirk d/b/a Alpine Aire Services Club Air Inc. Kevin Franklin Director, Contracts Matthew Curtis Eric Phillips V. P. of Operations 10823 NE Entrance Road President 5125 Voyager Drive 3700 McCauley Drive San Antonio, TX 78216 13129 Airport Road Dallas, TX 75237 Vandalia, OH 45377 210/824-9421 Little Falls, MN 56345 214/339-3992 937/890-8900 fax: 210/820-8656 320/250-0132 fax: 214/330-7982 fax: 937/454-8342 [email protected] [email protected] [email protected] [email protected] • Majestic Terminal Services, Inc. • Quality Aircraft Care Brian Cella Dennis Rieck President Owner Advertiser Index PMB 114 2056 Palomar Airport Road, Suite 1 Aero-Mach Labs 47 900 Meridian E #19 Carlsbad, CA 92011 Milton, WA 98354 760/438-8852 Air BP Aviation Services Back cover 253/862-1269 fax: 760/438-4861 Aicraft Technical Publishers 50 fax: 253/891-1338 [email protected] AirSure Ltd. Inside front cover, 52 [email protected] • Redmond Air, LLC • Mission Creek Lodge, LLC Mike Honey AmSafe Aviation 58 Dale DePriest General Manager Avfuel Corporation 3, 5 Owner 705 SE Salmon Avenue 25327 SE 19th Place Redmond, OR 97756 Avgroup, Inc. Inside back cover Sammamish, WA 98075 541/923-1355 Aviation Management Consulting Group 53 425/830-6620 fax: 541/923-4181 fax: 707/286-7753 [email protected] ChevronTexeco Global Aviation 30, 31 [email protected] • Royal Air, Inc. Christiansen Aviation Inc. 21 • N20H, LLC Glenn Adams CommAvia 39 Morgan Combs President Chief Pilot PO Box 52444 ConocoPhillips Company 6 3415 University Shreveport, LA 71135 Corridor 32 St. Paul, MN 55114 318/459-9000 651/642-4328 fax: 318/868-0124 Cygnus Expositions 38 [email protected] [email protected] ExxonMobil Aviation 4 • Oscoda-Wurtsmith Aviation Services, Inc. • Sky Bright Inc. Raymond Anderson Lee Avery FBO Manager 24 4073 E. Van Ettan St. Owner/Manger Hartzell Propeller Service Center 51 Osocda, MI 48750 65 Aviation Drive 989/739-8486 Gilford, NH 03249-6680 InterSEARCH 11 fax: 989/739-8490 603/528-6818 Jet Aviation 15 [email protected] fax: 603/528-1814 KaiserAir 57 • Palwaukee Service Center LLC [email protected] Scott Spjuth • Sovereign Flight Support (FBO) Landmark Aviation 12 Director of Maintenance Sheldon Steede Multi Service Aviation-U.S. Bank 54 26 East Palatine Road Vice President Wheeling, IL 60090-6309 1079 Southside Road MyFBO.com 33 847/537-1205 St. David’s, DD03, Bermuda Navigance Technologies Group 45 fax: 847/541-2252 441/335-3087 [email protected] [email protected] NetJets 48 Prime Turbines 8 Professional Insurance 55 R. Dixon Speas Associates 40 Raytheon Shared Services 17 Safe Drain 37 “The World Leader in Aviation Restraints” SevenBar Enterprises 23 ¾State-of-the-Art restraints including “airbags” Signature Flight Support 41 ¾Unlimited plating and webbing color options ¾FAA approved automotive style pushbutton restraints TAG Aviation 34 ¾Worldwide 24-hour AOG support Transportation Safety Apparel 11 ¾Call us at 1-800-228-1567 UVair 9 Velcon Filters 43

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