Airline Start-up
Our consultancy can provide the necessary means for Airline Start-up, to include both your Engineering and Maintenance requirements.
Carr Aviation Typical Startup-Airline Business Plan EXECUTIVE SUMMARY Description of airline concept (scope, revenue/cost structure, service offering, aircraft types, major markets served)
Target customer and perceived opportunity
Competitive advantage over incumbent carriers
Market share expectations and competitive strategy
Financial highlights: operating margin, profitability, etc.
Management team’s airline operations experience level
Capitalization plan and ROI expectations
INDUSTRY & TARGET MARKET Industry overview Target market analysis Economic state (GDP) Demographics / population Income statistics Growth rates Air travel market size and trends Forecasts for air travel O&D pax/cargo traffic demand by market
COMPETITIVE ANALYSIS
Incumbent airlines operating in the marketplace Current competitors’ market share by route Competitor service offerings (including aircraft type/age) Incumbent airline frequencies/schedules Fare comparison by service class and route Barriers to market-entry (gates, slots, bilateral agreements, etc.)
SERVICE OFFERING
Overall Concept Mission/Vision Statement Scope (domestic, regional, international, network) Markets to serve Headquarters / Airport base(s) Target customer segment Route structure (local, hub/spoke, point-to-point) Frequency Schedule Product / service offering (drives cost structure) Seat pitch Seat assignments Boarding process Service-class offering (economy, business, first, pods, beds) Catering (hot meals, limited, purchase, beverage-only, etc.) Aircraft interior (leather, bins, window size, lighting, age, etc.) Duty-free / in-flight shopping In-flight entertainment (IFE) - live TV, internet, video Power / IFE at seat Kiosk/online check in Airport lounges Customer loyalty program (FF program) Amenities (towels, pillows, blankets, socks, eye masks, etc) Aircraft Selection Capacity (pax/cargo) to meet demand Range to fly missions Economics for profitability Maintenance costs Fuel efficiency Reliability Engines (fuel/range/performance) Winglets (fuel/range/performance) Fleet commonality Avionics Buy/lease New/Used/Age Insurance (airframe, engine, pax/cargo liability) Noise/emissions Alliances / code-sharing / partnering Service entry and growth strategy Sustainable competitive advantage
OPPORTUNITY
Estimated market share by market / route
Fare pricing by class / route
Load factor by class / route
Expected operating revenue, costs, and margins
Profit potential and sustainability
Sensitivity analysis of profitability under various scenarios
MARKETING & DISTRIBUTION PLAN Marketing Strategy Marketing Mix (4Ps): Product
Price Fare structure Revenue management Pricing / yield
Place
Internet (direct)
Internet
Call Center
City Ticket Offices
Airport ticket counters (walk ups)
Global Distribution Systems (GDS)
Travel Agents
Corporate sales
Other (kiosks, etc)
Method (cash, credit, etc)
(sales and distribution)Promotion
(advertising)(service offering) (fares)
OPERATIONS PLAN Labour Pay rates / scales Benefits In/out-sourcing Administration Distribution Airport Operations Customer Service Maintenance (line, light, heavy, equipment) Ground Operations (ramp)
Dispatch
Flight Operations
Training
Fuel purchasing / hedging / policies
Technology (IT)
ETOPS (if applicable)
Cargo / Freight / Mail
Facilities / Equipment
MANAGEMENT TEAM Organizational Chart Executive Biographies / Resumes (CVs) for the 5 key functions: Airport Operations Flight Operations Maintenance Operations Finance Marketing & Distribution Other Management (VPs) Independent Board of Directors Professional Advisors/Consultants
RISKS AND MITIGATION PLAN
Business model risk Market share penetration Fuel costs Default on aircraft liabilities Safety Weather Geo-political Economic Regulatory Terrorism Infrastructure Gates/slots availability
FINANCIALS (5-year pro forma)
Income Statement (P&L) Balance Sheet Statement of Cash Flows Airline operating statistics & financial ratios
IMPLEMENTATION SCHEDULE
Iterative Development Phase Business plan development Financial model development Management team assembly Aircraft selection Investor “roadshow” Launch Phase – 12-18 months Funded Certification Aircraft sourcing Certification Staffing Facilities / Equipment Begin Flight Operations – 0 to 12 months Initial Growth Phase – 3 to 5 years
CAPITALIZATION PLAN
Startup capital needs
Seed capital sources
Aircraft financing
Venture funding
Equity Offering (if applicable)
Cash required from investors
Equity offer for investment
Use of funds
Anticipated return on investment (ROI)
Investor exit strategy
Timing
