I have worked out the numbers regarding profitability and cost associated with the flight school I'm trying to start up.

My data was based on previous flight school experiences.

I have based my expenses and profits data on 500 hours per year of aircraft use. and i am pleased and comfortable with the results. I was advised to set up my company as an "LLC" and write off all expenses associated with the operation.

I was somewhat surprised to see that the expenses associated with running a flight school make up over 50-60% of the total annual income. But i was not too surprised at this fact.

I will start out at first as the sole instructor, with one employee who will keep up with scheduling and phone calls etc while i am flying.

I will also start out with one airplane.

I have narrowed it down to the following two types

1. Cessna 172
2. Piper Warrior

I considered going the cheaper route with a Cessna 150/152 but i felt that it would be a bit underpowered in the hot Texas sunshine, it might be difficult to find a 150/152 that is IFR certified, and i feel like students would rather rent a 4 place airplane after they get their license rather than rent a two seater.

Do you guys agree with that observation?

I have decided to rent the aircraft for a rate between $95 per hour and $110 per hour wet. and charge a rate of $30 per hour on instruction. i think this is a pretty low average rate for instruction in the USA these days. (of course prices may change depending on fuel costs)

eventually i would like to grow the school to include two instructors, and two airplanes... perhaps one of which will be a complex or high performance. but i have concentrated more on the upstart aspect.

I also have great low cost lease option on a light twin but that is a long ways down the road.

I have not decided what to do about insurance yet... though i have factored in about 8,000 dollars per year in insurance costs.

any guys with experience in this sort of thing? would it be best to cover all students in my own insurance or have them each acquire their own?

feedback?

OK.. Now I'll try to answer points in order:

500 hours per year is 42 hours per month (months are easier to plan by). "Real" cost to operate a $60,000 IFR C172 is about $60/hour (fuel, engine, 100hours/annuals)... That'll be $40/hour gross income.. or .. $1,700 month.

I don't know your fixed costs (rent, utilites, etc.) but I'll guess at $500/month (assuming a hangar). Insurance isn't as tricky as it looks to factor in.. but it IS tricky when it comes to keeping attracting clients. If you go with a full waiver of subrogation, you'll have to charge more per hour. If you require renters to carry non-owner insurance, you can keep it lower. Personally, I think all parties are better off with the waiver... you just gotta sell it.. as in, "my rates are higher because you're covered". Either way, using your numbers ($8000 for hull replacement and liability (that's probably a little low)), it's $670/month.

You can see that this leaves you with just over $500/month in aircraft income. Let's say that 70% of the rental hours are dual. There's another $880/month of income... for a total of $1650 of "useable" income.. before daily, non-fixed and unforseen expenses.. which ideally, will be coverd by member dues.

Are we on the same page so far ?

Quick summary and a comparison:

Assuming these numbers are reasonably accurate..Knowing that you'll be working or available 7 days a week.. and nothing goes wrong...  Can you live on less than $20,000/year?

The club where I'm most active has 200 dues paying members ($30/month), 50 of them active, 10 very active...  We have eight airplanes ( 3 172s, 2 PA-28s, a 182, a Libert XL, and a Mooney 201) and 5 instructors (2 full time).. a full-time "clerk" and is run by a retired guy who draws no salary...  It's barely staying afloat flying  150-250 hours per month (1800-3000 hours per year).

Wow     I have to say that the realist in me is leary, but you've got quite a bit going for this operation.. more than enough to take a stab at it. The biggest hurdle is a supportive spouse (both that she's working and is understanding and patient about your dream)....

Flourishing clubs/schools do exist.. and they all started small...

You don't seem pie-eyed.. quite the contrary.. if this can be pulled off..it sounds like your situation and plan are quite sound...

I won't bother to research exact numbers re: insurance and the like.. you'll get accurate data soon enough..


Life is short and it's not a practice life...   Go for it !

hope so... we are still a few months away from even setting the ball in motion... but i remain cautiously optimistic.

I doubt that this flight school idea will ever generate enough money to replace a typical 9 to 5 job, but i enjoy aviation and my wife does too (even though she is not a pilot) and we can sure try like hell 

when i was there instructing in 2005 i licensed 20 pilots that year as the sole instructor with only one airplane and no advertisement other than word of mouth... and i have a lot of friends at the airport.

hopefully it will turn out that i have enough things going in my favor to make this work, even if just a little bit. 

Enyone who reads this forum knows how I feel about Light Sport. Not only not a good idea.. it's a solution to a problem that doesn't exist. Believe  me... our club has looked into it. There's a reason that there's still virtually no LSA rental fleet out there. Insurance companies don't want anything to do with it... and I can't blame them. The main attraction to Light Sport (for a new pilot) is that you don't have to take (or retake) physicals examinations.. and you can become "licensed" with far less trianing. Would you want to underwrite that group of people, as a whole ?

I'm all for less expensive; more economical flying... and once you're licensed, by all means, go out and get a Light Sport airplane. The planes themselves are wonderful... It's this darn short cut to training, and a driver's license counting as your medical, that's the problem (and what's keeping a rental fleet from forming). My near 30,000 hour mentor still turns red when you bring up this topic... and the well respected and oft-published opinion of Richard Collins...

Quote:


... is one that I agree with.

If you're not willing (or able) to pass a third-class medical every couple of years... and not ready to pay for an extra 20-30 hours of training at the very begining of your flying life (a very small expense when you consider you'll fly for many years and many hundred (if not thousands) of hours), then it's probably not a good idea for you to BE flying airplanes.. especially with other people on board.

During my brief tenure as an instructor.. I came to realize, that even after conventional training, very few pilots are good insurance risks... but you gotta turn'em loose at some point.

Apparently this is mainstream wisdom, 'cause even several years into this Light Sport stuff.. the rental fleet is non-existent. Seasoned instructor don't like it.. Veteran pilots cringe.. and most importantly.. insurance companies aren't crazy about it, either.

I can see keeping a Light Sport plane in a rental fleet.. Both for licensed pilots to punch economical holes in the sky.. and as a less expensive plane for conventional instruction. But I'd not be interested in helping fill the air with pilots graduating by Light Sport standards.

Yeah.. the medical issue is an ever looming threat to ground a pilot. And it has to be that way. I'm glad I'm not responisble for drawing the line that has to be drawn. Diabetes is a no-brainer though. Light-headed-ness and disorientation are the mildest symptoms when blood suger is off... Blurred-vision unconsciouness and seizures are the extreme... and the stress brought on knowing that it's happening, aggravates it all.

With age, comes heart, blood-pressure and vision issues.. and of course metnal accuity and motor skills. As I near fifty; I know my last medical is coming in the not too distant future. Right now, I have to time my eye-exams around my FAA physicals, because my eyes are that bad. I've already conceded that this is my last, second-class certificate and won't even try for anything above third-class, next year. Diabetes runs in my family, and I have had glucose issues, when I was 250lbs (I'm 215 right now). I'll probably ground myself, before I'm sixty.

The medication stuff is touchy... but you gotta fault on the side of caution. I had a potential student on Zanax. There was no "narcotic" effect. I honestly believe that a person's motor-skills are relatively unaffected by these drugs. But, if you need drugs to function on the ground, for whatever reason, you probably shouldn't be flying airplanes.

Is Light Sport, as a way for people just under the bar to keep flying, a good idea ? If you ask me right after I've surrendered my medical certificate, I'll probably say, "yes".  However, common sense dictates otherwise. As the system sits; nothing can stop a person from buying a Light Sport (or Cessna 172, for that matter), and tethereing it at an out of the way, county airport, and hopping around the countryside on a beautiful day. And nothing can stop them from taking a friend up, with them. In that regard, pilots are self-policing.. and potential passengers are on their own to make the decision on whom they fly with. It's always been that way for ultra-lights. We have no choice but to let older, or medically-marginal pilots act responsibly... and there's always been an argument for some sort of minimal traing for ultra-light pilots (albiet, unenforceable).. BUT..Once you cross over into government sanctioned and issued documentation.. lower standards are not the way to go.

The biggest and most tangible benefit from these wonderful, Light Sport airplanes... is economics. They're a much less expensive way to fly.. and that's a good thing. If I'm not mistaken, a Champ, Cub (or something very similar) can already qualify as a Light Sport plane, by weight, speed and horse-power. In the big picture; considering all flying expenses; 20-30 additional hours spent learning, is nothing. The Light Sport license, is a solution to the problem that doesn't exist. If these planes are to ever take a significant place in rental fleets (code for insurance under-writing), and be an economical profit center for fledgling schools/clubs; we've got to run a stake throught the heart of the Light Sport pilot's license.

I agree with you Hagar, mostly. Nobody is kidding anybody about a U.S. third class medical examine as being anything more than; showing up.. proving that you can see.. having your blood-pressure checked.. giving some urine to prove you're not on drugs or diabetic.. and letting an aviation-minded doctor SEE you up close. And that sounds like what's required for your NPPL. Over here, that's not the case for Light Sport Pilot. The only examination for a drivers license is for your vision... and that immediately qualifies you for Light Sport training. You can be a drug addicted, diabetic, with high-blood pressure and a heart condition, and get your Light Sport Pilot license. Insurance companies know this... and they'll tell a club as much when you try to add a Light Sport Plane and Light Sport Training to your club's roster and curriculum.

The silly thing is (like you point out)... few people will get signed off by an instructor after only minimum training. Most will end up with the same amount of hours, and dual instruction, as a regular pilot, taking regular training. They'll end up with nearly the same commitment of time and money, anyway. And actually it will end up costing more when they realize this.. as the training is not 100% transferable. When you consider the big picture; how much time and money flying will absorb; that difference twixt a Light Sport license and a regular PPL, is nothing. The only way you're going to be able to fly a Light Sport airplane, often enough to do it safely, is if you buy one. That kinda shoots the "money saving" aspect down... Just get a regular PPL, and put this Light Sport gremlin to rest... *ugh*.

Anyway...This thread is about running a flight-school. Anybody associated with that type of flying wouldn't be satisfied with only being able to fly out of un-controlled fields, in good weather, during daylight hours. And no flight-school will stay afloat under those restrictions. Flight-schools have insurance companies to answer to and rely on pilot/members who pursue advanced ratings (instrument/complex/multi-engine), and end up actually flying places, with passengers on board.. in and out of complex airspace... etc, etc...

Having an economical, Light Sport airplane or two on the roster would be a bonus. I'd LOVE to have one of these gems at my disposal, when all I want to do is go fly for an hour or two. There's a reason; after all these years; there's still no Light Sport rental fleet. As long as there's still the possibility of under-trained, medically-unqualified pilots hopping into these things; they aren't viable, flight school airplanes.

As for statistical anomalies ? (80 year-old pilots, or 5-hour solo helo-pilots)(I already know I won't be flying past 60 for health reasons).. that's exactly what they are.. Not the norm.. and not a reference for setting the standards.

Bottom line... in order to fly safely, you have to do it often. For most, that means renting. For the guy who can afford to buy a Light Sport... getting a regular pilot's license is no big deal. And the only way an FBO will have a Light Sport airplane available for rent, will be to a pilot holding a regular pilot's license. Their insurance will see to that..