28.03.2024

How to open an airline?

The chairman of the Board of Directors of Tulpar Air Group, a popular expert of the Russian aviation market Azat Hakim, told about the requirements for handlers and what is the guarantee of their long successful work in the market.

The aviation market is small and highly competitive. But nevertheless on it it is possible to find niches which small companies will be capable to borrow also. It is about handling, ground handling of flights.

Having invested in your business from 5 to 10 million rubles, in a month you can go «to the point of zero» and get the first commission. Especially valuable to hear about how to organize this business, from those who directly use the services of handlers – from the owners of airlines.

Where to start?

The hero of our article notes that opening the airline in our time is a troublesome and ungrateful business. This business is so serious and low-margin that there is nothing to do for beginners in it. This can be a hobby for billionaires – they can afford to buy an airline and play in aviation. And there are such examples, but these stories end, as a rule, failure. To open an airline from scratch, you need at the initial start of not less than 150-200 million rubles, and this is only to start, and not the fact that these funds will be returned. In recent years, a number of disasters in the Russian air market have led to the fact that Rosaviatsiya aimed at reducing the number of airlines and their consolidation.

Therefore, Azat Hakim does not advise anyone now to open an airline. He also identified a few more niches in the market, which he does not advise to go to startups. There is a very high competition in the catering market. Training-training will require huge investments: one simulator costs like an airplane. Maintenance of the sides is a low-margin business that requires high qualification. Creating interiors for aircraft will require the creation of a whole mini-factory and recruitment of highly professional engineers, and given that there are almost no «uncompleted» customers on the market, it will be difficult to find orders.

But it is not all that bad. If the aviation industry attracts the attention of the entrepreneur, that is, a niche in which a newcomer can try his hand. This is handling of ground flights. This is a kind of intermediary, which represents the interests of airlines in their relations with the airport enterprises. Employees of the handling company – supervisors – take on the organization of the flight, agree with the airports on the take-off and landing of the aircraft, meet and escort the crew, control the supply of food, maintenance, refueling and boarding, provide the crew with transport and hotel rooms. You do not need big money to start such a business. However, the competition is high, and to get you to the airport, you have to believe you should have connections and reputation.

The owner of such a business must first of all understand how the aviation industry works, how flights are organized, how the airport works. He must know the technical points in the work of the crew, the time of sending, arriving. He must know the technology of preparation for departure, what is behind what goes. If he knows everything, let’s say, because he studied for an aviator, graduated from an aviation institute, worked somewhere in the industry, he could negotiate with the airport. You can start without an office – to regulate the processes from home, even from the car. But as you grow, you will need to rent a room inside the airport, so that there are supervisors who meet the crew and serve the aircraft.
As a rule, the handlers themselves are not removed in the cabin of aircraft and are not engaged in maintenance.

They just take care of this from airlines and pay for takeoff and landing at airports, agree with cleaning companies, maintenance companies, supply catering, fuel companies, order minibuses for the crew. Air carriers themselves are disadvantageous to have a huge staff of workers who would deal with all this incredible number of questions at each airport. And it would be difficult to staff it: it requires a completely different qualification, different experience and other knowledge, and the training of relevant specialists for each carrier would be too expensive and would take too much time.

Azat Hakim, Tulpar Aero Group

It’s not easy to get to the airport for beginners-handlers. The management of the airport tries to take this business into their own hands, as a rule, their companies are working, designed for frontmen. But with a big desire to get to the market you can. Ways mass. For example, recently I was surprised by some guys. They came to me, agreed on a meeting and offered their handling services in all the airports of the world. They themselves lived in London, moved to Moscow, because they believe that the market here is growing.

They have offices in Europe and Malta, they work in many European airports, in Moscow. The competition there is very cruel, but they succeed. Why? They perfectly know English, have a good education, very energetic and charismatic. If they persuaded me, it says a lot. From the first meeting I believed in them. It’s handling on the world level. And they began only 5-7 years ago. But their advantage is that they also organize the flights themselves. Not every airline has such strong specialists to quickly and competently «break through» the permission to fly to other countries, this process is difficult. But these guys have all worked out, they provide the whole range of services, up to permission to fly to another country. Also they take all the costs for themselves, the airline can pay these costs and their services after the flight or even in a month.

This is the main advantage of addressing the handlers, because not always the airline has free money before the flight, but it is already necessary to fly. to quickly and competently «break through» the permission to fly to other countries, this process is difficult. But these guys have all worked out, they provide the whole range of services, up to permission to fly to another country. Also they take all the costs for themselves, the airline can pay these costs and their services after the flight or even in a month. This is the main advantage of addressing the handlers, because not always the airline has free money before the flight, but it is already necessary to fly. to quickly and competently «break through» the permission to fly to other countries, this process is difficult.

But these guys have all worked out, they provide the whole range of services, up to permission to fly to another country. Also they take all the costs for themselves, the airline can pay these costs and their services after the flight or even in a month. This is the main advantage of addressing the handlers, because not always the airline has free money before the flight, but it is already necessary to fly.

What other nuances of the market need to know? You need to know in person the participants of this market – the airline, the owners of aircraft, all who will use your services. And proceed to the search: who will be the starting customer, in which airports with whom you can agree.

Investment size

How much should you invest in the company’s opening? To begin with, from 5 to 10 million rubles. All this money will go to fulfill the order, that is, to ensure the flight of the airline: in particular, to pay for the services of technicians who serve the aircraft, cleaners, purchase of kerosene and refueling services, booking hotel rooms and transfer, etc. In essence, all this money the airline Will return you back when you serve the flight, plus will pay agency fees.

The expenditure on advertising this type of business does not involve. You can only place an ad about your services on the Internet. But the target audience of this type of business is spot.

To the airline trusted, you need a personal contact, you need to come, meet, I need to see these people. Only after that I give the command to sign a contract.

Where can I find funds for launching? Experts do not advise taking loans. Business is low-margin, and credit interest will eat up all your income, you can even go into negative. For a startup, this is not an option. You can sell a free real estate and invest your own money. Or find investors and partners. For state support funds this type of business is not interesting.
The current costs of this business will depend on the volume of orders. In addition, if you recruit staff, you will need to pay salaries and pay for business trips, because the supervisor should be in the city where the serviced plane will arrive, in advance to negotiate with the airport, prepare a lane and so on.

Step-by-step instruction

Some handling companies conclude contracts with fuel filling companies, buy kerosene and themselves fill the aircraft, thereby earning more. If the fuel company does not want to enter into an agreement with you, know that the law does not prohibit it today. You can complain to the antimonopoly committee, and they will quickly be forced to sign a contract and put the fuel in storage.

It is recommended to establish long-term relationships with counterparties – hotels, cleaners, carriers, etc. It is quite possible to obtain from them a 10-15% discount, promising to constantly resort to their services.

The airline should not have any problems during the voyage – this is the task of the handling company. If suddenly a crash occurred and the aircraft boarded a spare lane, it is necessary to quickly organize a gas station there, etc. Sometimes handlers also take care of the visas for the crew.

Important personal agreement, meetings with the leadership of airlines. Therefore, you need to track the market, read professional literature. They must understand who to turn to. The aviation world is small, everyone knows each other. If they worked well, I will advise them to their partners. Telephone advertising begins. In aviation, the main thing is reliability. If you worked reliably, you will get good reviews, register in the market, and after that the main thing – do not let anyone down.

What kind of staff do you need to work? In the beginning, 2-3 people will suffice. The more customers, the more you need to have specialists. In the company with a serious turnover, a maximum of 30 people work. Each manager takes one or two flights and specializes in them – who in the south of Europe, who in the north, someone takes on Asia. Of course, this requires knowledge of the language. Without the knowledge of English to hire a person to the position of supervisor there is no sense. Typically, the work around the clock – mainly due to the time difference between cities and countries. Therefore, it is necessary to provide for the organization of work in shifts. Plus, employees must understand finance, in accounting, since all their work is connected with payment of services of organizations. Also handlers should be communicative, be able to negotiate and respond quickly to changes in conditions.

The earnings of a handler depend on its ability to obtain discounts from airports, cleaning companies, hotels, maintenance companies. Due to these discounts, the competitiveness of the handler is growing – it can offer its services at lower prices. However, the handler can bargain with the airline: if she is ready to pay for your services today, they will cost, one thousand dollars. If it is ready to pay only in a month, then you can increase the agency commission, as it turns out that you give the airline money at interest. And the airlines go for it, because they understand that money is expensive. But what percentage you can agree on with them depends on your art. As a rule, in case of an annual delay, 10% per annum is added.

A place

At first, the premises can not be rented. Airlines, as a rule, do not even ask if you have an office. The main thing is that you cope with the organization of the flight without delay, because the laws of the market are cruel: once you bring the customer, or rather, his passengers, and he will no longer work with you. But later you will understand that the rented room in the airport building is not a luxury, but a necessity. The supervisor should be near the flight field to quickly receive and track arrival information and on time to meet the aircraft. Its area can be small – 10-15 sq.m. This is a simple room where supervisors can be, when, for example, arrivals are delayed.

Documentation

No special permission is required to start this business. Previously, this type of activity was licensed, but today this procedure was canceled, because it does not require special knowledge, but only entrepreneurial grasp and organizational abilities. A person can work at the airport for a while, and if he is smart and initiative, he will cope with the leadership of a handling company.

Check-list of opening

  • Analysis of the market and competitors (range of services, prices, personnel, etc.),
  • Choice of assortment of services,
  • Registration of IP or LLC, registration with the tax inspection,
  • Search for employees (if needed),
  • Interviewing, selection of candidates,
  • Scheduling shifts,
  • Making a loan (if necessary),
  • Search for the first customer customers through negotiations,
  • Conclusion of contracts with airlines service providers.

Is it profitable to open

The cost of the company’s services consists of the cost of the cost of the organization of the flight and the agency commission. On average, the agency commission for the market is between 3% and 10% of the cost of all expenses. Sometimes it takes 10% – in case the flight needs to be arranged urgently, say, on the same day. It is not easy in such a short time to get permission to arrive from the country, you need to make a lot of calls, spend a lot of energy. And the airlines, understanding this, are going to increase the commission.

If you immediately successfully entered the market and collected a certain number of customers, then the invested money does not disappear anywhere – you paid for the initial flights, presented an account to the airline, and the airline returned them to you. So in a month you can go on a plus.

How can you increase your profits? Only at the expense of turnover, that is, increasing the number of customers. The volume of work is growing – the commission volume is also growing.
But it is worth considering the risks existing in this kind of business. First of all, these are the risks of non-payments – in the event that you contacted the airline, which is bankrupt and insolvent. With such a customer it will be possible to sue, but it will be possible to return the money only two years later. Therefore, it is important to know the financial status of customers, because you pay for them and you must be sure that this money will return to you.

Another risk is to do something wrong, disappoint the customer and lose the client. I had an example. We work with many handling organizations. Once, one company failed to organize an urgent flight to Italy. They turned to others – they could. Naturally, we no longer want to address those who have not coped with this task. Therefore, we have concluded agreements with many companies for a back-up – there are only about ten of them. Some of them work well with China, others specialize in Europe.

But this market is almost not affected by the seasonal factor. In the summer, a little less business activity, but many are flying to rest.

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