(Be careful about calling them ramp fees.) beta.SAM.gov is now home to all current contract opportunities formerly posted to FBO.gov.

If that rate is discounted because the FBO expects a tenant to buy a certain amount of fuel to make up the difference, and they do not for any reason, the operator loses. He adds $26 for unanticipated landing fees at other airports for an annual cost of $50. Whether or not the customer buys fuel, they are still using the FBO’s facilities, flushing the toilet, watching the new flat-screen TV, eating the popcorn, using the crew car, and the list goes on. Search Contract Opportunities Create …

The FBO of the future could easily be one that generates the majority of its revenues from sources other than the sale of fuel. If we are not careful, the FBO industry could end up like the legacy airlines.

Although most FBOs over-lease their hangar space to offset some of the potential loss, the reality is that if it is leasing space at a below market rental rate; the FBO is foregoing the opportunity to lease that space at a market rate (or more) to someone else that needs it more — and is willing to pay for it.

Aircraft Owners & Pilots Association Find it free on the storeWe have constructed a hypothetical operating cost estimate using a 1975 Cessna 172M Skyhawk. Why not capitalize on this selection criteria? For years, FBOs have heavily discounted rents for office and hangar space in exchange for the promise to buy certain volumes of fuel.

However, with the current state of the industry and economy, I think it is time for many FBOs to reassess the way they run their business.Although there are many opportunities for change in the traditional FBO business model, the greatest opportunity probably lies in the handling of office and hangar rents, facilities fees, and the accompanying fuel discounts. Pilot Frank lee Hooked has just bought the Skyhawk for $39,000. The occupancy of office and/or hangar space by a tenant occurs whether they buy fuel or not. Logging 300 hours the first year year, Frank will pay $108.10 per hour to operate the Skyhawk. Frank anticipates logging 300 hours over the next 12 months. A lease of space is for the right to occupy that space for a period of time at a specified rate. If an FBO wants to discount fuel prices to tenants, it should be based upon a sliding scale that ‘kicks in’ when the customer actually reaches the volumes that they promised when they negotiated the lease and fuel deal.

If Frank compares his calculated $125/hr rate to the local FBO rental rate of $135/hr – wet – on a comparable airplane, he sees that he has already bettered his flying cost position. The summary, developed with the assistance of FBO and air charter members, discusses the costs of operating airport businesses and the many variables that go into determining its pricing …

The FBO industry is a service industry that happens to offer a commodity. Higher operating costs and required services must be spread across level, or in …

In many cases, it was simply the result of a change in the way the company or individual utilized the aircraft. Giving up the hangar for an outside tiedown spot cuts storage expense more than half. The fee is for what the pilot gets when they use the FBO ramps, bathrooms, heated or air conditioned lobbies, flight planning facilities, various “free” amenities, and so on. In common practice, an FBO …

If they get fuel, they should have to pay extra (and by extra, I mean full retail less any volume discount). This model applied to office and hangar space, as well as use of the ramp and other facilities and services. Please login below for an enhanced experience.

Landing fees are difficult to estimate, but Frank knows that the airport he flies to once a month on business trips charges a $2 landing fee.

Several years ago, the concept of “unbundling” was introduced with equal fanfare and resistance. With our network purchasing power and special member pricing, Signature Select™ optimizes operating costs. Insurance costs will vary by type and amount of coverage, size of fleet and other factors.

However, most FBOs will waive the facilities fee if the customer buys a certain amount of fuel. Direct Operating Costs Breakdown of Direct Operating Costs … A fixed-base operator (FBO) is an organization granted the right by an airport to operate at the airport and provide aeronautical services such as fueling, hangaring, tie-down and parking, aircraft rental, aircraft maintenance, flight instruction, and similar services. Offsetting the ownership expenses will be the equity Frank builds in the Skyhawk!
Why have FBOs adopted the philosophy that as long as the customer buys fuel, they can use the facility for free? Better yet, charge full price and subsequently discount money back to them once they reach a certain purchase plateau. Read the Quick Start Guide and get familiar with beta.SAM.gov's features.
exit conditions, investment or business models, cost-based rates, net operating revenues, adequate rates of return, mergers, and rates and charges schedules. Already a member?


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