Selling houses or selling airplanes, similar strategies succeed
Earl Kessler merged his passion for aviation with his business and now he’s using skills he learned during a career in real estate as he and his wife, Pat, build Reno-based Vast Aviation.
“My father was a World War II pilot so I grew up in the back of an airplane,” he recalls. “When I was 16 I was expected to get my student license, and I became a private pilot on my 17th birthday. I’m 58, so I’ve been flying for over 40 years.”
After devoting most of his career to real estate sales, he decided three years ago to focus on the sales of aircraft.
“The skills I learned being a real estate broker really apply to aviation sales,” he says. “Rather than doing it on a used-car basis I do it like real estate. I am very big on full disclosure, as you’re dealing with a product that can end somebody’s life.”
For instance, all customers are encouraged to arrange a pre-purchase inspection by a licensed mechanic who has never seen the aircraft before and has no interest in it.
Like the owner of real estate, the owner of an airplane can face foreclosure. And the value of the aircraft can change dramatically if the foreclosure is unfriendly.
In an unfriendly foreclosure, the owner may not provide the maintenance records that can account for about one third the value of the aircraft.
If the records known as “airworthiness directives” aren’t available, mechanics need to physically examine the plane. Reconstruction of some records may require a major, and expensive, disassembly to reach a specific part.
Kessler includes an appraisal and full title search that discovers any liens against a plane he sells. And he asks for a disclosure statement from the seller noting any problems with the aircraft.
“I’ve found what works well in real estate works really well in aviation,” he says.
Fifteen years experience as a flight instructor also helps his sales effort.
“I wanted the ability to teach my sons to fly and I also found I really have a flair for flight instructing,” he says. “I’m very passionate about aviation and that helps when you’re flight instructing.”
From Reno, he travels to where his students are.
When he’s selling a plane, his experience as an instructor allows him to check out pilots to make sure they are ready for the planes they’ve purchased.
For delivery the buyer either picks up the plane or pays a ferry pilot to deliver it. Recently, however Kessler, flew with a buyer to New Hampshire so he would be comfortable and checked out in his new aircraft.
“It was a true cross country,” he says.
Kessler focuses on a market segment that’s held up in these tough times.
“I’ve specialized lately in single-engine piston aircraft, which is the lower end of the market. Say the quarter million dollar on down for small airplanes because, frankly, that’s what’s selling,” he says. “Because of the way I do sales, the entire country and the entire world is my business place.”
While he’s completed some international sales, most buyers are either from the East Coast or the Midwest and currently Kessler is seeing an accelerating rate of sales. Most are cash transactions, with the buyers either retired or about to retire and want to realize their dream of flying.
“It’s definitely a buyer’s market and that’s the result of the poor economy we’re suffering through. What it really comes down to is pricing and I’ve got to be careful not to overprice anything. If it’s priced properly, it will sell,” he said.
Recently China opened its airspace to general aviation, which is another potential opportunity. Kessler added there are two flight schools in California training new Chinese pilots and they’ll need aircraft to fly.
The potential of the Chinese market? “We have 315 or 310 million people in the United States and they have 1.3 billion people,” Kessler says.
Kristina Miranda, who was hired recently as a staff accountant at Clausen & Company, is currently enrolled at the University of Nevada, Reno and is earning a Bachelor of Science in business administration.