Airlines Business Plan

This is another area of failure that we have spotted time and time again.A robust regime of accounting and reporting needs to be embedded so that the Management Information is credible.

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One example springs to mind whereby a West African carrier operated and soon as an aircraft came upto C Check they folded as nobody advised the extend of the costs and no money was provisioned for the Checks, nor was a provision made for a temporary ACMI or other solution being brought in while the main aircraft may have be away for Checks.

The airline in this example opened and closed within 3 months.

There are no real globalised players operating locally with the exception of ASky which is backed by Ethiopian Air.

Whilst the ownership has a track record of success, clearly as they are in a position to fund an airline startup, we have seen a trend in such ventures struggling to be accreditive and expand, the venture is either loss making and kept going via shareholders introducing extra funds into the business or the venture running on goodwill of the suppliers and amassing debt.

Engine/Maintenance and other basic Reserves are not planned or even accrued for in one instance we came across.

We are currently engaged developing 2 business plans for our clients and once we run the numbers, if the venture does not look acceditive within the client’s timescales we will advise the client not to take the concept forward.Ravindra - France Ravindra has a hands-on experience in the design, implementation and monitoring of loyalty solutions for airlines.He has already successfully conceived and implemented scores of FFPs at several airlines of the EMEA region.Assuming the airline has a Business Plan that makes sense and meets the profitability timescales acceptable to the client, it has to be embedded into the business, strictly monitored and variances quickly identified by root cause and corrective action should be taken where necessary.So, behind the Business Plan you need effective financial control.Its not just about paying bills and collecting revenue its about financial management and quality information.We have experienced atleast 2 carriers where monthly management accounts were not produced for the Executive Office or the Board, the airlines were effectively flying blind.John is a seasoned airline executive boasting over 25 years of experience in the aviation industry.AIROPS Consulting Group provides a wide range of aviation services including among others business process reengineering, project management, business analytical services and other general consulting services in a selection of functional domains, including flight operations and resource management.Lack of Robust Business Planning and Financial Control is Holding Back West African Airlines In this, our latest article on West African aviation, we look at another key root cause on why West African aviation is stifled.As we have discussed before, usually airlines in West Africa are owned by a wealthy businessman or consortium diversifying into the field of commercial aviation.


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