For FBOs that provide refueling services, those fuel sales are their lifeblood. Commercial websites such as www.airnav.com and www.flightaware.com publish retail fuel prices for most FBOs. Inexperienced or casual users of private aviation may not realize that very few charter providers or corporate operators pay retail pricing. At airports where multiple FBOs compete, these published prices can be meaningless.
The operator of the aircraft may have a private arrangement with the FBO for a reduced fuel price, and many purchase fuel through a transaction known as a "fuel release". A fuel release involves a third party in the purchase transaction. This third party makes an arrangement with the purchaser for credit terms and accepts any payment risk for the FBO. FBOs establish payment terms with the third party, usually pay no fees like those associated with credit cards, and for the hope of getting more of the third party's business, provide a discounted price for fuel. These third parties can be fuel distributors, brokers, aggregators, or flight handlers. There are also organizations that represent special interests or groups of operations that petition FBOs to offer discounted fuel pricing to members of their organizations. At airports where more than one FBO exists, these organizations will often pit FBOs against each other for deferential pricing to garner a favored status, the FBO hoping to get the business of that organization's members.
There are a few large FBO companies that have such wide national and international coverage they are able to offer blanket contracts to operators of aircraft fleets. There are umbrella organizations that single locations can join in order to extend their reach to clients.
Many fuel release providers and FBOs offer loyalty programs that benefit pilots. These programs can and do sway the selection of FBOs and the sales of fuel at those FBOs. Unfortunately, they usually provide no benefit to passengers.
In the charter world, any savings given by an FBO may or may not be passed to the paying passenger. Less organized operators will often contact competing FBOs a day or two before flight, going back and forth by telephone or email to renegotiate their fuel cost, often below the discounts afforded through fuel releases, even though their quote has already been accepted by the paying passenger. It is an easy method of bettering their bottom line. Many FBO owners or managers unwittingly play into this game, eroding their own margin, but the more disciplined understand the rules of the game and may opt to pass on the opportunty to sell very low-margin product in a deal that undermines relationships with fuel release providers.
As one of the two principle components of any successful private air travel event, FBOs are almost universally judged and rated by crewmembers, and to a smaller degree by the flight operations office of the aircraft operator. The selection criteria typically involves an amalgam of variables, the primary two being fuel price and service. Well rounded flight staff can speak from their experience regarding the abilities of various FBOs, but their experience and thus, judgement can be significantly different than that of the real end users, the people sitting behind the cockpit. Corporate flight crews are often extremely dialed into the needs of their passengers who are often their direct employers, but charter flight crews may see two or three different sets of passengers in a given duty day, so their sense of what is good or bad is likely quite a bit different than that of their corporate counterparts. Either way, there is no dedicated mechanism to record the impressions of passengers passing through the FBO. LimaTwo aims to remedy that in the near future.
Too little attention is given to the cost of non-fuel items. Some FBOs publish their fee schedules or at least display it openly or upon request. Competitive pressure will provide some cost relief, but as all operators in general aviation know, FBOs that are "competitively advantaged" can charge what the market will bear. It is not uncommon for an FBO to give away lavatory or GPU service in order to win a large contract or to gain the loyalty of a potential repeat customer. But caveat emptor of ramp/handling charges, concession recovery, disbursement fees and the like. The only way to keep from being presented with an invoice full of surprises is to ask for a quote in advance of arrival.
In fairness to FBOs, they are in business to make money. It is not reasonable to expect no charge for just dropping off a passenger or just to clear customs. In most cases FBOs are not operating in public terminals, and so have made substantial investment in real estate, infrastructure, facility, equipment and personnel.
While great emphasis is placed on fuel price by most owners and operators, service can be more important for the simple fact that it can mean different things to different FBOs and to its customers. Fuel price should be a secondary consideration in a competitive environment if the staff of a given FBO display indifference or worse, incompetence.
In a broad context, "service" is the culture that an FBO operates under. It is as much knowing how to perform a task, as performing that task well. Of course, knowing how to fuel an aircraft safely and properly is critical, but if the line staff is distracted by their cell phone or the FBO is understaffed or under-equipped to handle a request promptly, then any savings in price requires examination. Likely any FBO will say that they provide the "best service", not really knowing what that means because their frame of reference is subjective.
On the apron of an FBO (or anywhere inside the fence at the airport, for that matter), everything that happens does so in accordance with a regulation, ordinance or statute. Many FBOs train their staff to industry standards and in compliance with national and local requirements. There are a handful of organizations that offer third party training programs, may of them quite excellent. The most recognized of these programs is NATA's Safety First. Larger FBO companies train their staff with similar in-house programs that include policies and practices unique to their organizations. The core elements of any of these programs are nearly identical. Though seldom asked by air taxi or charter operators, if any FBO is reluctant or unable to provide a written training statement or demonstrate that their staff is otherwise in compliance with governing laws, proceed with caution.
The cornerstone of every successful enterprise is the relationship between the buyer and seller. Whether a transaction is a one-off event or one in a series of repeat patronage, how the FBO performs their duties and treats everyone in the process determines how their service is perceived.
Most often, the opinions of the end user, the passenger, go unobserved. It is the intent of Lima Two to record those opinions with the goal of providing an anonymous, unbiased and heretofore unknown perspective of passengers utilizing the professional services of private aviation.
Content and Images Copyright (C) 2018 By Lima Two LLC, All Rights Reserved.
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