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About Aviation Business Financing

Thursday, February 05, 2009
Related Tags: aviation | business | aircraft | lenders | sba
 

Instructions

Considerations

  • Step 1:
    Business planAll businesses, whether start-up or currently operating, need a concise, understandable, and well-documented business plan to secure loans or investments. Be very clear what the business hopes to accomplish and how it will achieve its goals and objectives. It is usually a good idea to refrain from introducing too much "flash" into the business plan. Stick with solid, clear financial and marketing projections.

Types

  • Step 1:
    Aviation business financing may involve commercial loans, investment, leasing, or a combination of all three. Much depends on the plans for the business. The type of financing may depend on whether aircraft are to be chartered, carry passengers and/or freight, flying lessons or used for other purposes.

Misconceptions

  • Step 1:
    Contrary to some beliefs, Small Business Administration (SBA) financing may be available for an aviation business. Planning to own a number of jet aircraft for charter will probably require more funding than SBA could provide. However, a flying school with only one or two small single engine aircraft may qualify for a loan.

Warning

  • Step 1:
    Aviation businesses are attractive to some lenders, but not to others. The perceived risk and level of uncertainty that surrounds the aviation industry at regular intervals sometimes takes bank lenders out of the market. Those lenders that specialize in aviation business financing, however, understand business plans and the ebb and flow of the industry. It may be wise to look to them for financing.

Effects

  • Step 1:
    The large expense for purchasing or leasing aircraft, the need for diligent and experienced maintenance, and the vagaries of the industry make proper aviation business financing necessary to keeping aircraft where they belong--in the air. For every United, FedEx or Delta Air Lines, there are many smaller aviation businesses, almost all of whom need effective financing. Rates and terms are often quite reasonable. Lenders who understand the industry and the ability of aviation business owners are normally flexible and willing partners.

Resources


About Aviation Business Financing Provided by eHow.com
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