Q: How did you get started in business aviation?
A: My father has been in the aviation business his entire life. He was a Beechcraft distributor in South Africa. I’ve been flying ever since I can remember and have been in the business for my entire working life.
Q: What led you to launch Jet Sense?
A: I started Jet Sense two and a half years ago. I put in 20 years working for General Aviation Services, a company founded by Dan Dickinson. I enjoyed it, but the time had come to move on and do my own thing. I funded the business with my own capital and the company continues to be privately owned.
Q: Jet Sense specialises in the buying and selling of aircraft. What do you need to succeed as an aircraft broker?
A: Clearly you need to build up a solid client base. We buy, sell and lease aircraft on behalf of a wide range of customers, from private individuals to Fortune 500 companies. This year we will move about 25 aircraft, which gives us a very good revenue base to continue to grow.
We are in the business of looking after our customers and we go to great lengths to be as knowledgeable about the pre-owned market as possible. Customers vary widely in the extent to which they have already defined what it is they are looking for when they set out to upgrade their existing aircraft. A typical scenario is the customer expresses an interest in buying a certain model of aircraft, then asks us how that fits with what is happening in the market. From there, we are able to guide our customer through the process of buying their aircraft.
Q: Do you have a market niche, such as mid-size, or light jets that you particularly focus on?
A: We have sold everything from a small Beech King Air up to a Gulfstream 550. Typically though, the aircraft we buy tend to be mid-cabin jets for resale.
The other thing is that due to our extensive knowledge regarding the pre-owned market, our reputation for being able to find the appropriate model to meet the client’s needs quickly, is growing. If a client comes in and defines their goal as: “I want an aircraft to fly away in within the next 10 days,” Jet Sense is capable of meeting that goal.
Innovation is another trait of Jet Sense. If someone wants to sell an aircraft right away, but also wants to participate in the transaction as a business partner, we can accommodate them. We can do a profit share that allows some income now for the aircraft and has the potential to become a future business partner in a separate transaction.
Jet Sense has experience with handling unique opportunities. Remember the Legacy jet whose wing tip hit the Boeing in the Amazon? Gantt Aviation and I partnered to obtain the Legacy from the Amazon and today it’s a normal flying aircraft. If you want to know more, we can talk on that separately because it was quite the adventure!
Q: It seems that your willingness to take on a measured amount of risk by buying an aircraft for later resale is being well received by the market?
A: We calculate the risk very carefully. However, this is a pure, entrepreneurial business and it is based fundamentally on accurate information, knowing the market and knowing the aircraft that you are taking a position in. A broker without that skill set will lose opportunities while trying to accumulate that knowledge after the request comes in. Some aircraft sales and purchases take a long time to complete, but the right answers, given promptly, are the key to good business. This is what Jet Sense specializes in.
Q: How important to Jet Sense is the forging of partnerships with other organizations?
A: Partnerships are vital and a key component for us. They are a great way of leveraging additional capabilities and amplifying our reach, resources, and skills base. We have excellent partnerships in the USA, in South Africa, and in Europe. Our partners contact us, they tell us a client is looking for a particular type of aircraft, they ask if we can we help, and we always try to succeed for them.
Q: In employee terms you are still a modest sized business. What are your ambitions?
A: We have four employees right now and we rely significantly on our partnering deals, which we do a lot of, to generate momentum for us. Working together with the network of partners we have built makes us feel larger. We attend EBACE and NBAA to make sure that we fly the flag for Jet Sense.
Q: What is your sense of the market right now?
A: What we see is that some prices are still falling, while in other categories, some stability is returning. There are buyers out there, and there have been every year since the crash of 2008. You just have to have a pretty competitive aircraft to sell and you need to know what it is that your buyers want. If a guy wants a low time aircraft you are never going to sell him a higher time aircraft, and vice versa.
Another clear trend in the market is that banks do not like funding aircraft that are over 15 years old. They really push clients towards newer aircraft if they are going to want to finance their purchase – and everybody these days wants to finance a purchase rather than paying cash. Jet Sense has the ability to help with the financing.
Q: Are you seeing pre-owned aircraft selling faster these days?
A: If your aircraft is competitively priced, I would say that four to six months would be the typical market time for a sell. When you purchase an aircraft, as we do, for onward sale, you have to know where the current market is with a fair degree of precision. In this we take more risks than the average broker, but we support this risk position with an extensive amount of market research.
Then there is the subjective element. People have to feel that they are getting value for their money. However, everyone measures this differently. If an aircraft has very low time on it and has hardly been flown, do they see value in paying $1 million more for a little less flight time on the aircraft? Some people will value that greatly, while others will not.
The aircraft that move the fastest, are the ready-to-go airplanes, with new interiors, upgraded avionics and state of the art in-flight entertainment systems. If you put these things into your aircraft, you may not get dollar for dollar return on that investment, but it will certainly accelerate the sell time. If you put $1 million into upgrades, you may only see an $800,000 return on that investment, but you gain the benefit to the speed of the sale. Most buyers just want to buy the aircraft and start using it and are unwilling to wait four or more months for a refit.
Q: Are you planning on growing your head count soon?
A: We definitely need more personnel as our workload continues to grow, but partnering deals allow us to the ability to power through excessive work periods. We are always open to more partnerships. We already essentially have an office in South Africa, given our partnering deals there, and we would like an office in Europe soon, and one in South America. But all this will come…