Club Calculation

There's hundreds of flying clubs around the country that own and manage aircraft for their members. Aside from the camaraderie, clubs make flying more affordable.

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FrankR
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Club Calculation

Postby FrankR » Wed Jun 26, 2013 11:18 pm

I did this calculation for a used airplane a bit back.

Trying to scare up interest in East Central NC.

15 Members
$48,000 Purchase
100 Hour Inspections
Tires at 200 hrs
Oil at 50 hrs
1500 Total Flight hours per year
Hangar
New Engine at 2000 Engine Hrs (1400 Hrs from now) – Engine fund funded
Incorporation, Purchase, Escrow, Tax, CPA’s and Attys
Office expenses & Marketing for new members
Prudent Reserve and Bad Debt fund

$4133.33 Buy in per member
$68.89 per member per month
$48.42 per hour flight time wet
Frank
Fayetteville, NC

Merlinspop
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Re: Club Calculation

Postby Merlinspop » Thu Jun 27, 2013 8:03 am

Some thoughts:

The ratio of 15 members to 1 aircraft may be a little high. I was in a club with 16 members with 2 172s and availability was rarely an issue, but there were conflicts. That's with half the members being in the Air Guard and almost always gone.

Also, using a wet hourly rate necessitates having an account with the local fuel provider. That will entail more work by your club's treasurer or other officer (read: YOU) caused by settling up with them and applying credits for fuel bought at out airports and juggling receipts. My club used a dry rate with a "top it off after each flight" policy. Keep logs on who flew when and spot check to catch people who don't adhere to the rule.

I'm not sure that 100 hour inspections are required, although prudent.

Round up buy in to nearest $100, other rates to nearest $5 or $10, for simplicity.

Have monthly meetings, regular BBQs during the spring/summer, semi-annual plane wash days. Do what you can to make the club as much social as it is a way to have (somewhat) less expensive access to an airplane.
- Bruce

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drseti
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Re: Club Calculation

Postby drseti » Thu Jun 27, 2013 11:03 am

I think the 1500 hours per year is way too optimistic. The average pilot flies 25 to 30 hours per year. If you're an owner, maybe you can double that. With 15 members, I'd plan on the plane flying 500 hours per year, and amortize accordingly.
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FastEddieB
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Re: Club Calculation

Postby FastEddieB » Thu Jun 27, 2013 2:58 pm

Merlinspop wrote:My club used a dry rate with a "top it off after each flight" policy.


Probably not the best plan for a Light Sport.

Full tanks can easily put many Light Sports over gross with just two large occupants.

That would leave the choice to defuel or to fly over gross, and the only correct choice there is to defuel, which can be a royal PITA.
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rfane
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Re: Club Calculation

Postby rfane » Thu Jun 27, 2013 5:29 pm

One thing you missed is Insurance.
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Former owner of a 2006 Flight Design CTsw

FrankR
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Re: Club Calculation

Postby FrankR » Thu Jun 27, 2013 6:59 pm

rfane wrote:One thing you missed is Insurance.

$4500/yr is in the monthly rate.

AOPA had a really good webinar last night about club insurance. They are going to post the recording soon. Nothing new or unusual presented; just that club isurance is more available than I have been finding.

Also, LSA club insurance is nothing special, unlike what I am finding.

I also found out that if two club members are flying, the passenger isn't covered unless he has renter's insurance, which wouldn't be otherwise required.
Frank
Fayetteville, NC

FrankR
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Re: Club Calculation

Postby FrankR » Thu Jun 27, 2013 7:06 pm

Re-calculated with 500 hours per year and flying time dry.

Left it at 15 members.

$4029 buy in,
$69 mo,
$26 hr.
Frank
Fayetteville, NC

Merlinspop
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Re: Club Calculation

Postby Merlinspop » Fri Jun 28, 2013 7:34 am

FastEddieB wrote:
Merlinspop wrote:My club used a dry rate with a "top it off after each flight" policy.

Probably not the best plan for a Light Sport.

Full tanks can easily put many Light Sports over gross with just two large occupants.

That would leave the choice to defuel or to fly over gross, and the only correct choice there is to defuel, which can be a royal PITA.

Agreed... just saying how my club did it. Half tanks is possible, but more subjective. There are other ways. I would just try to avoid having to have someone settle up every month with a fuel provider and deal with everyone's receipts to credit them back for fuel bought at other airports. That's got to add significant time to the monthly administrative chores. I'd reconsider if setting up a club account would get you a significant discount on 'home base' fuel.
- Bruce

FrankR
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Re: Club Calculation

Postby FrankR » Fri Jun 28, 2013 10:08 pm

Bruce,

Remember, I live in an Allegro world. 638 empty, 1230 MTOW. Two 250 lb'ers and 87 lb fuel is 3.5 hr/full.

Not to say Allegro will be or should be the choice.

As for supply, our school keeps a pickup truck with a bed tank in the hanger. Something similar can be arranged.
Frank
Fayetteville, NC

Jack Tyler
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Re: Club Calculation

Postby Jack Tyler » Sat Jun 29, 2013 4:25 pm

Frank, two quibbles and one biggie (as I see it, anyway)...but first, congrats on sticking with this project. You'll make a good partner.

Your 'fuel arrangement TBD' comment is a good example to illustrate my first quibble: You can't have identified all things to all partners with your initial numbers. Another example: Everyone going to bring his/her own tablet and/or charts? (Probably not. One of many partnership benefits is the sharing of cost for required charts. Given the mix of possible solutions, as a group you may end up with subgroups that deal with chart costs...or you may have a group solution that - minimally - fits everyone). My point: Follow the previous suggestion and round up your numbers so you cover a few currently-unknown incidentals. (BTW Bruce is correct about how fuel costs can complicate the month-end reckoning of a partnership OR it can be greatly simplified. Go for simple.) And while I'm on that train of thought...

Quibble #2: To attract the maximum possible partners, the a/c will need to have the largest possible useful load. That suggests to me a 1320# MTOW a/c, or at least a preference for one.

'My' biggie (I've mentioned this before) has to do with this not being an academic exercise for you. You obviously are trying to form a viable Light Sport partnership. Yet we've looked at your geographic location and 15 members continues to strike me as an overly optimistic goal...yet the financial numbers on which you build the partnership's promise assumes this large group. (Personally, my own partnership experience tells me you'll end up feeling like you are herding cats to have 15 members in the first place). Would you be willing to start with 10? With 5? Well, no...you can't. At least not based on the cost buy-in you are forecasting that attracts potential partners in the first place. Your answer in the past has been that this number produces the buy-in cost that you are prepared to accept. That just may leave you on the horns of a dilemma: a financially viable arrangement (for you) that fails to produce a viable partnership, or adapting the plan to a more viable group size that eliminates its leader (you). It leaves me wondering if you can physically consider a PPL and fly a Part 23 a/c under Part 91. That would immediately increase the likelihood your efforts will pay off. (Sorry if you covered this in an earlier thread and I've forgotten the answer).

Jack
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FrankR
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Re: Club Calculation

Postby FrankR » Wed Nov 06, 2013 4:02 pm

Jack,

Group size: You have identified the conundrum.

My vision is to make flying affordable and inclusive using the Sport Pilot rule.

I've seen these PPL groups that have hundreds or over a thousand members and don't own a plane. This is because there is inventory available for lease back. Not so in the LSA world. Aircraft must be owned, and in order to make it affordable, the number must be a bit bigger.

My vision is 30, 50, 75 members; several aircraft. A vibrant, growing group. But we can start with one.

My training/rental aircraft has supported 20 or more pilots at a time. Virtually no one gets exactly what they want, when they want it. You have to sign up for weekend time a week or more in advance. But the rental pilots do get affordability. More freedom, and more afforability will be realized under my plan.

There will also be more, though not quite limitless freedom in scheduling and flight rules. Our rental virtually eliminates overnights. This will be more possible with member ownership and "only" 10-15 members.

The location, and the fuel arrangements, will depend on specifically "where" these members come from, and consequently, where we locate.
Frank
Fayetteville, NC

FlyingForFun
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Re: Club Calculation

Postby FlyingForFun » Wed Nov 06, 2013 4:44 pm

Delete
Last edited by FlyingForFun on Sun Dec 01, 2013 11:42 pm, edited 1 time in total.

Jack Tyler
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Re: Club Calculation

Postby Jack Tyler » Thu Nov 07, 2013 4:52 am

"Another option might be for an individual to purchase an LSA and then form a club to help absorb some of his fixed cost. Charge an initiation fee, monthly fixed fee, and hourly fee (dry). The other club members would not have an equity position."

That's certainly one viable approach, and you don't need to limit it to a 'Club' design. A simple co-ownership arrangement, with only one or a portion of the co-owners having equity positions, is also an option. In more populated areas, using a 'partner finding service' like AOPA operates can be one on-line method for locating the potential partners/club members. That certainly worked for me in the Jax area. IMO the main challenge Frank faces is that he wants a flight hour to be more affordable than the population density and/or level of interest in his general area has - so far - made possible.

There may well be clubs who are successful but own no aircraft...but I have yet to read about a highly successful, long term club that doesn't own the majority of their own equipment. I can imagine a number of reasons why that's the case.
Jack
Flying in/out KBZN, Bozeman MT in a Grumman Tiger
Do you fly for recreational purposes? Please visit http://www.theraf.org

FrankR
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Re: Club Calculation

Postby FrankR » Thu Nov 07, 2013 9:53 pm

Brother Jack, thank you for your helpful insight. It is much appreciated.

One big club I know of is Plus One Flyers in San Diego. They have 1300 members and don't own a plane.

http://www.plusoneflyers.org/
Frank
Fayetteville, NC

Jack Tyler
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Re: Club Calculation

Postby Jack Tyler » Fri Nov 08, 2013 4:02 pm

Nice website. And now I know of one...
Jack
Flying in/out KBZN, Bozeman MT in a Grumman Tiger
Do you fly for recreational purposes? Please visit http://www.theraf.org


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