Flight Options: A Failed Business Model?

[ToTheStars]

I remember when Flight Options was a pretty good company to work for. We had a future, bigger jets, better salaries, and great benefits. Flight Options was a small family and we really did care about one another. Oh we had some dirt bags, bad pilots as well as managers and Ken Ricci sold snake oil pretty well.

Most of us who were savvy to the business world knew it wouldn’t last forever, especially if aircraft sales declined. Ken knew this all too well also. Selling jets is what kept the company a float. We wrote just about any kind of contract to sell an aircraft to get past that elusive “critical mass”.

But when did the company begin its decline? Or was it never really profitable? Was it a failed business kept afloat by the support of Ken’s inertial unit repair company? Was it kept afloat by his Cleveland investors who finally started calling in the chips?

Where did things go wrong? Was the failed Raytheon merger and final buyout to blame? Or was it poor management once Raytheon began to try to run the business; i.e. Michael Sheeringa and his staff?

Could all of these problems have been prevented if Raytheon had developed a better relationship with the pilot group and kept the original Ricci philosophy of having the best paid pilots in the industry? Certainly many of the company’s difficulties surround this one issue?

I’d like to know what everyone else thinks are the decisions and people that ultimately brought about the demise of what was once a pretty good family company to work for?

On a final note: My thoughts and prayers go out to all of you who have lost your job.

 

[brokeflyer]

nothing wrong with the business model....they took what NetJets did and did the same thing. Only the management screwed up by being greedy.

very common tale.

 

[ToTheStars]

Actually, Flight Options began by selling fractional shares of used business jets and later sold new Raytheon aircraft. It was a slightly different model.

 

[brokeflyer]

ok well whatever it is....they fcked it up

 

[ToTheStars]

Well thanks for clearing that up

 

[jonjuan]

nothing wrong with the business model....they took what NetJets did and did the same thing. Only the management screwed up by being greedy.

very common tale.

Yes-there was something very wrong with the business model. Selling 10+ year old planes to prospects who were led to believe that most of the depreciation had taken place" was their downfall. Aircraft 10 years of age + and 10,000 hours typically have a sh1tty dispatch reliability. FLOPs grew by selling "cheap, used aircraft" and it ultimately caught up to them as owners were raped on resale valuations (who is going to buy a 15 year old 400A with 10,000 hours) and aircraft continually breaking on the ramp.

If you don't think nja management ain't greedy- lol

 

[ToTheStars]

Ahh yes the used car dealer. Yet these aircraft sold well. New paint, interior, and entertainment system. No one seemed to care much about the age and hours until it came time to sell their share.

But then Raytheon came in and limited the age and hours per aircraft. Why didn't this improve the companies profitability? Or did it improve and management fumbled?

 

[Galaxy]

Uncle Kenn offered liquidity in his contracts for a percentage fee. It was the fall of the dot comers that brought about the first body blow to FLOPS. The inertial repair business was a CASH COW for him. When the crash of the dot comers he had to get money to pay them out which forced the sale of the CASH COW. FLOPS was a good company to work for and it did seem like a small family. Lets not forget that we only had the bargain basement millionairs and B list celebs. He thought the merger would bail him out but he lost the funding and got lucky and cashed out. Mother Raytheon came in and started with the big corporate mentality and from there we know the story till it leads to today. The days are limited for FLOPS. You can not suceed in a service industry without providing the service part. Catchy slogans and renaming a bad plan like fractional 2.0 or go forward plan or even vision 2012. Reality is ...the lack of vision that landed FLOPS here on the reapers door.

 

[ToTheStars]

I'm guessing HIG has decided that the only cure to this straw house is to sell the aircraft at the peak of the market to make way for the new EMB aircraft. In doing so, they can also terminate the high dollar employees and start new again with young kids fresh out of the freight dog world hungry for a crew meal, carpet, and daylight.

It certainly makes sense to sell off what is now non-profitable. Flight Options always said, there really isn't any money to be had in flying the aircraft, it's the sale of the aircraft that makes the business.

 

[hammer2]

I would like to formally thank Flight Options for not answering any of my many resume's sent by mail, fax, email, pigeon, and referral. Again thank you from the bottom of my heart!!!!!