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