how to get started as AC broker?

Buy an airplane and then sell it. Simple as that.

Nope. Sell the airplane and then buy it. That way you're never stuck holding the bag.

Jose
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for Email, make the obvious change in the address

Are you insane?

If you make 10% on each plane, and then have to eat a loss because of a bad
buy or something, it can wipe out a lot of other deals. Seriously, buy a
172 for 45. Spend 2 on it, and sell it for 53. Now, find out you need 10k
in repairs to get your money out of the fourth one - and it starts to look
lame. Now, try to make 15%, and listen to both sides squeel like pigs.

Also, Van Bortel distributes/sells a lot of new Cessna's, so he has
relationships with lots of FBO's and schools that way. Those relationships
multiply.

Add in the fact that you are now despised and mistrusted by most of the
population because you are now a salesman. You can look in the archives here
about how most folks think about brokers and sales people. If you want to
know real frustration, go try to buy a plane from someone who is NOT a sales
person. I have heard sales people tell a few whoppers, but plane owners
take the cake by far. Still, its the sales people that get hated.

If you are not sufficiently discouraged, then know that the world does not
need more brokers that are not full service. Have a maintenance crew and an
interior crew that can fix your planes before and AFTER you sell them.
Standing behind your planes with a warranty can't happen if you can't fix
them.

The only other thing I can think of is opening a consignment lot may be the
way to go. Start an FBO where the ramp and hangars are dirt cheap, and let
people put the planes there for sale for a fee.

"Dude" wrote in message
...
Are you insane?

My thoughts exactly. Most brokers deal in 150-200K+ planes because that's
wher you start to have a little room to build in a margin for yourself.

IMHO the biggest opportunity out there right now is in LSA (light-sport
aircraft). But all the money there is going to be in service, just like car
dealers now that grandma knows how to look invoice prices up on the
Internet.

Can you afford to put any money down on anything? Or were you just hoping to
spend your off days by a telephone trying to make deals?

-cwk.

"Bill" wrote in message Comments, input, etc wanted

Learn the business from a mentor.

Anyone can make a good hit, maybe several hits. However, to sell aircraft
full-time without losing everything to the lawyers of a disgruntled
customer, you need to know the intricacies of the business. For example,
where would you find out if there is a state income tax lien against an
airplane you represent? The FAA doesn't record tax liens. The new owner will
be hit up for the lien. The new owner will hit you up for reimbursement. The
end result is that you lose money. Another example is if you broker an
airplane and the DEA confiscates it for alleged illegal practices of a
previous owner. The DEA can do that, and the new owner can seek
reimbursement from you. The end result is that you lose money.

D.

(Bill) wrote in message om...
(Looking for serious replies please...)

I am a ATP pilot with a general aviation background, and am growing
tired of the insecurity of the (no matter where you work) "pro pilot
job." Pagers, on call, no real vacations, etc, etc.

I think the biggest problem is that there is a much higher expectation
for brokers than private sellers. If someone buys a plane and then 30
days later realizes that there is some expensive problem, they will
expect you to take some ownership of the problem. You may decide not
to but you will get a rep for selling crappy planes. Also, when
someone comes to buy a plane they expect it to have less issues at the
door from a broker than a private party. There is an outfit out of San
Antonio that is a Mooney broker. They frequently write in the Mooney
rags about the increased costs of a broker. Sometimes they can eat a
deal just on unexpected delivery expenses.

-Robert

Bill,

I looked into this a while back. Here were my conclusions.

My going in assumptions were that all businesses that succeed tend to do it
in one of three ways..

1. Add compelling value vs competition.
2. Assume equivalent risk at a lower cost than competition.
3. Do something for which there is no competition.

As a sell side broker without inventory:
It is hard to add value by increasing exposure, simply because anyone
can put an ad on controller, aso, etc themselves.
It is hard to add value by taking the phone calls, simply because at the
low end someone isn't going to be willing to pay you enough to cover your
fixed expenses.

It is hard to add value by specializing in a particular set of planes
(thus becoming the "go to" place to buy one), simply because the volume of
turbo bugsmasher XYZ's sold in a given geography typically isn't very
high.

OK, so if it is hard to add value to the seller, how can you add value to
the buyer?
Providing a warranty (taking risk) was the obvious answer.
Unfortunately, all my A&P friends tell me it is impossible to estimate with
any certainty whatsoever what the claim profile for a given plane
will be, even if an annual has just been done. Apparently, failures in
mechanical parts and avionics are just too random to predict. This
means that you cannot insure against these losses.

This leaves one alternative:

Assume risk by trying to "buy low, sell higher". Very, very challenging
because it requires you to accurately forecast not only the direction of the
market, but also your carrying and most importantly repair costs while
holding the inventory.

My conclusion from all of this was that becoming broker wasn't such a hot
idea vs other opportunities. Not that you can't make money at it, it just
didn't seem that attractive to me.












"Bill" wrote in message
m...
(Looking for serious replies please...)

I am a ATP pilot with a general aviation background, and am growing
tired of the insecurity of the (no matter where you work) "pro pilot
job." Pagers, on call, no real vacations, etc, etc.

Another friend of mine, also an ATP, feels the same way. However we
both want to remain connected to aviation and are thinking of opening
a small aircraft sales/brokerage business, focusing on basic airplanes
such as Cessna 172/182, Piper Warrior, Beech Bonanza, etc.

Basically planes that already sell themselves....

No, we are not going to put Van Bortel or Jack Prewitt out of
business, I realize that.

Nor was Rome built in a day. We would like to get started slow, then
maybe over a 5 year time frame, have an established business running.

Not that it matters, but we both sold used cars in college and are
both BA's in Business.

This is a serious question, no flamers please. Van Bortel, Jack
Prewitt, Clay Lacy (all respected brokers) got started SOMEHOW, and I
refuse to believe that with the right mindset, business practices, and
a good plan, the playing field cannot let another newbie come into the
business.

Comments, input, etc wanted

Fly Safe