Forums: Skydiving: General Skydiving Discussions:
DZ Operations

 


rickfri59  (A 42078)

Dec 24, 2002, 1:33 PM
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DZ Operations Can't Post

Let's say a jump ticket to 13,500 from a Super Otter costs $20 (US Dollars). Generally speaking, how is the $20 allocated? Does a set amount go to the plane (owner or leasing company) per slot. I'm assuming the planes are leased (right/wrong). And does the DZ make the majority of it's money on the fun jumpers or Tandem/AFF? During my AFF I had plenty of standing around time waiting for the weather to cooperate. My education being Accounting and Business Administration, I found this to be a very interesting looking business. Looked like great cash operation. Do the owners life day-to-day, meal-to-meal, or are they (the seasonal DZ's) able to spend winters laying on a tropical beach?


AggieDave  (D License)

Dec 24, 2002, 1:37 PM
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

Most DZs make very little money on the fun jumpers. Its the Tandems/students that keep the operation going. A majority of the jump ticket goes to the plane's lease/insurance, then fuel, maintance and to pay the pilot. If it wasn't for students and tandems, then jump tickets would probably cost aroudn $40 a pop.


hooked

Dec 24, 2002, 1:38 PM
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

I've wondered the same thing. I'm anxious to see if there is any response on this subject.

J


rushmc  (No License)

Dec 24, 2002, 1:46 PM
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

Adding to what the other posted....insurance on a jump plane runs from 3% to 5% of the value of the plane per year. If a Porter goes for $400,000 that is a chunk of change!


weid14  (D 20292)

Dec 24, 2002, 3:21 PM
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

I did all the math at a cessna DZ for the DZO once... In my experience, the more succesful DZ's buy their own planes, it is getting to that point where they have to lease them, and may never get over the hump... typically planes are leased "dry" meaning no fuel included and go by the hour... some others, go by the number of loads and a set number of jumpers times a set rate ($13.00 rings a bell). If you are the owner of the plane, you have to figure:
airframe maintenace
Engine maintenance
Avionics maintenance
fuel
depreciation
office staff (some one has to pay them in manifest)
advertising (yellow pages, fliers, radio, TV)
grounds maintenance
electricity

there is way more to a jump ticket than just avgas.


diverdriver  (D 19012)

Dec 24, 2002, 8:41 PM
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

In reply to:
Let's say a jump ticket to 13,500 from a Super Otter costs $20 (US Dollars). Generally speaking, how is the $20 allocated? Does a set amount go to the plane (owner or leasing company) per slot. I'm assuming the planes are leased (right/wrong). And does the DZ make the majority of it's money on the fun jumpers or Tandem/AFF? During my AFF I had plenty of standing around time waiting for the weather to cooperate. My education being Accounting and Business Administration, I found this to be a very interesting looking business. Looked like great cash operation. Do the owners life day-to-day, meal-to-meal, or are they (the seasonal DZ's) able to spend winters laying on a tropical beach?


Wannna make a small fortune in running a DZ? Start with a large fortune. Wink


keskeie  (D 26254)

Dec 24, 2002, 10:27 PM
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

I heard at Perris that it costs something like $8/minute to run an Otter -- that including plane and repairs, fuel, pilot, etc. Though I'm not sure that covers the land the dz is on and the extra freebies they give us like the perriscam and net access and such. That's a large dz, of course....


Premier PhreeZone  (D License)
Moderator
Dec 25, 2002, 12:51 PM
Post #8 of 15 (1329 views)
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

I know one large Multi plane operator charges between $15-16 per slot for his planes when he leases them out or sends them to a boogie. Granted at special times they go cheaper then that but that 16 has to cover the planes (over 750000 a plane), insurance, maintence, pilots, admin fees, savings for upgrades, and lots of little things. I know a lot of larger planes like the CASA's and even some Otters at places are leased to the Military as much as possible since skydiving is a day to day operation. Blow a turbine on a Casa and its 250000 to replace it. Otters are'nt much cheaper if they need new turbines and props.

Since even a 182 is going for a min of 35000 thats in good shape a fun jumper at 15 a slot (only flies to 10k) its going to take about 600 full loads just to pay the plane off. Not including the cost of all the things that go with a plane or DZ such as loans and intrest too. As much as we hate them, tandem factories are the best way to make money in the skydiving business. Instead of 15 you'd get 150 or more a jump, pay out 35 or so and its 115 that goes towads the bills and profit.

Most seasonal DZO's spend the winter doing other things such as working another job, heading south to work at another DZ, or anything to do to get by. One of my local DZ's just sent me an Email stating that the DZO and his wife have taken jobs during the winter and the DZ will not be open at all for 3-4 months since they have to live and bills have to be paid somehow.

It takes some one that knows what they are doing to be able to take time off during the winter and still have a DZ in the spring.


rmsmith

Dec 25, 2002, 6:13 PM
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Re: [rushmc] DZ Operations [In reply to] Can't Post

In reply to:
Adding to what the other posted....insurance on a jump plane runs from 3% to 5% of the value of the plane per year. If a Porter goes for $400,000 that is a chunk of change!

A nice -27 or -34 Pilatus Porter sells for roughly $750k to $900k, and it is a specialty tail-wheel STOL aircraft, which means that it has higher cost insurance than say a Cessna Carvan of the same value. The insurance industry has recently doubled their rates as well as raised the bar for the pilots that they'll allow to fly under their policies.


(This post was edited by rmsmith on Dec 25, 2002, 8:59 PM)


gemini  (D 24349)

Dec 26, 2002, 12:15 PM
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Re: [rickfri59] DZ Operations [In reply to] Can't Post

Usually the owner of the jump planes is a separate company from the skydiving company. In some cases the school may be a separate company, and the property may be owned by even another company. This structure is to attempt to limit liability in the event that an accident occurs somewhere on the dz.

As a result, the aircraft are still "leased" to the skydiving company for a fixed fee per jumper. If your DZ charges $20 per fun jump, I would suspect that $11-$13 is paid to the aircraft company. This leaves $7 to $9 for the skydiving company for a fun jump. In many cases the skydiving company pays for the pilot on a per load basis and pays all the fuel costs. In some cases the dz may also pay minor maintenance costs as well. (FYI: a twin Super Otter burns about 30 US gallons per load to 13,500 ft.)

If a tandem is $189, then the instructor may make $45 which leaves $144 for the skydiving company prior to paying the aircraft fee of $11 - $13. Obviously the dz makes a little more for tandem jumpers, somewhat less for students and very little on fun jumpers.

Aircraft insurance runs 2.5% to 3.%% of hull value. Maintenance runs about $75 per flight hour on top of periodic inspection fees.

Of course all of the above are based on my limited knowledge and experience with one drop zone and two Otters. Larger dz's may realize some economies of scale by having the same engines on all planes, mechanics and pilots on staff, etc.


indyz  (D 28525)

Dec 27, 2002, 12:22 AM
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Re: [AggieDave] DZ Operations [In reply to] Can't Post

In reply to:
Most DZs make very little money on the fun jumpers
I was quoted $1.50 profit per fun jumper per load at one smallish DZ with a rented King Air. It's better with tandems and students, but it ain't gonna make the DZO rich anytime soon.

The DZO at my home dropzone has to go back to his non-skydiving job during the winter in order to make ends meet.


Hooknswoop  (D License)

Dec 27, 2002, 12:49 AM
Post #12 of 15 (1116 views)
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Re: [gemini] DZ Operations [In reply to] Can't Post

Quote:
Usually the owner of the jump planes is a separate company from the skydiving company. In some cases the school may be a separate company, and the property may be owned by even another company. This structure is to attempt to limit liability in the event that an accident occurs somewhere on the dz.

As a result, the aircraft are still "leased" to the skydiving company for a fixed fee per jumper. If your DZ charges $20 per fun jump, I would suspect that $11-$13 is paid to the aircraft company. This leaves $7 to $9 for the skydiving company for a fun jump. In many cases the skydiving company pays for the pilot on a per load basis and pays all the fuel costs. In some cases the dz may also pay minor maintenance costs as well. (FYI: a twin Super Otter burns about 30 US gallons per load to 13,500 ft.)

Right, but if the same person owns all the companies, the profit is the same.

Quote:
the instructor may make $45

$45.00? Who pays $45.00 for a tandem?

Hook


gemini  (D 24349)

Dec 28, 2002, 9:52 PM
Post #13 of 15 (1010 views)
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Re: [Hooknswoop] DZ Operations [In reply to] Can't Post

Quote:
may make $45

Emphasis is on word may...or may make $20, 25 or 30. Specifics are not that important, because it is the entity structures and the waivers that will save the dzo from losing everything not where the profit resides.


bunge  (D 24784)

Dec 29, 2002, 9:41 AM
Post #14 of 15 (973 views)
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Re: [Hooknswoop] DZ Operations [In reply to] Can't Post

In reply to:
Quote:
$45.00? Who pays $45.00 for a tandem?

Hook

maybe if the tanem piolt packs too..........


Premier PhreeZone  (D License)
Moderator
Dec 29, 2002, 10:00 AM
Post #15 of 15 (966 views)
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Re: [bunge] DZ Operations [In reply to] Can't Post

Still only about $35-40 at most places.



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