Owning your own DZ

[JediMindTricks 0]

anyone have any idea how much it would cost total to own a medium sized dz ??

[dks13827 3]

Be sure to start with a lot of money.................
and go from there !

[evillejmper 0]

There is a saying- How do you make a million dollars in the skydive business? Answer- Start with 2 Million!

[stratostar 5]

Define 'medium' sized...

you can't pay for kids schoolin' with love of skydiving! ~ Airtwardo

[jimmyh 0]

Medium:
the middle quality or state between two extremes; a reasonable balance

Sized:

adjective [in combination ]
having a specified size; sized : marble-size chunks of hail.

[wildcard451 0]

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Medium:
the middle quality or state between two extremes; a reasonable balance

Sized:

adjective [in combination ]
having a specified size; sized : marble-size chunks of hail.

skydiver == that special kind of prick that you wanna smack...but will still jump with.

[stratostar 5]

you can't pay for kids schoolin' with love of skydiving! ~ Airtwardo

[quade 4]

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There is a saying- How do you make a million dollars in the skydive business? Answer- Start with 2 Million!

The joke was funny decades ago, but I think it would be difficult to start a "medium" sized DZ for $2M these days. A small one, maybe 1/2 a million, but you start getting bigger than a couple of 182s and it's going to start getting real expensive real fast.

quade -
The World's Most Boring Skydiver

[PhreeZone 15]

With a Caravan going for 1.1-1.4 Million and a Otter approaching 1.4-1.7 Million its not a cheap start up cost to get into a turbine airplane. 3 million would get you an airplane, a dozen or so tandem rigs and half a dozen student rigs. Figure in the extra's like hanger space, jumpsuits, etc That is enough to get you started.

Yesterday is history
And tomorrow is a mystery

Parachutemanuals.com

[Squeak 17]

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With a Caravan going for 1.1-1.4 Million and a Otter approaching 1.4-1.7 Million its not a cheap start up cost to get into a turbine airplane. 3 million would get you an airplane, a dozen or so tandem rigs and half a dozen student rigs. Figure in the extra's like hanger space, jumpsuits, etc That is enough to get you started.

Unless the PAC 750 has gone up in price would it not be a better starter plane for purchase and running costs? <$1M
10 Tandem rigs
6 student rigs,
etc...
2 Mill weould cover it.

PLUS Insurance

You are not now, nor will you ever be, good enough to not die in this sport (Sparky)
My Life ROCKS!
How's yours doing?

[quade 4]

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With a Caravan going for 1.1-1.4 Million and a Otter approaching 1.4-1.7 Million its not a cheap start up cost to get into a turbine airplane. 3 million would get you an airplane, a dozen or so tandem rigs and half a dozen student rigs. Figure in the extra's like hanger space, jumpsuits, etc That is enough to get you started.

Unless the PAC 750 has gone up in price would it not be a better starter plane for purchase and running costs? <$1M
10 Tandem rigs
6 student rigs,
etc...
2 Mill weould cover it.
PLUS Insurance

I think you're being wildly optimistic about the cost of starting up.

Attached is a spread sheet from 2005ish comparing just some of the aircraft options. Obviously costs have gone up.

Beyond just an airplane and a couple of rigs, you also need facilities. Very few airports will allow you to just pull your airplane up to a runway and start a gypsy operation. ;^) You're going to need an office, classroom, packing area, staff, legal help, advertising.

Additionally, you're going to need a reserve of cash for when something goes wrong. For instance, the engine has a problem. Every day the prop isn't turning is a day you're not making money.

quade -
The World's Most Boring Skydiver

[JediMindTricks 0]

That's depressing..... :'( I need to buy more lotto tickets.

[skydived19006 4]

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I think you're being wildly optimistic about the cost of starting up.

Attached is a spread sheet from 2005ish comparing just some of the aircraft options. Obviously costs have gone up.

Beyond just an airplane and a couple of rigs, you also need facilities. Very few airports will allow you to just pull your airplane up to a runway and start a gypsy operation. ;^) You're going to need an office, classroom, packing area, staff, legal help, advertising.

Additionally, you're going to need a reserve of cash for when something goes wrong. For instance, the engine has a problem. Every day the prop isn't turning is a day you're not making money.

And the bills don't stop because you're not flying.

My opinion is that in the majority of cases, it would be a much better idea to start out as a small DZ, and grow your way into a turbine. You need to be keeping 3 to 5 Cessnas busy before you'd have the traffic to justify a turbine aircraft. Start out with one 182, a couple of tandem rigs and 2 to 6 student rigs, you could get going for $100,000 (cash/loan combo) easy enough. I took over an existing DZ including airplane and student rigs 10 years ago for less than 50K. "Earned" enough the first year to pay staff (other than the DZO), cover payments, and replace the engine.

IMO, you'll need to be doing at an absolute minimum 500 tandems, more like 1000 a year before you should consider quitting your "real job" and becoming a full time DZO. Currently for instance, nobody in Kansas is a full time skydiver or DZO. I have seen it done, you simply need to have a very low standard of living, single, trailer sitting adjacent to the hanger kind of thing.

Experience is what you get when you thought you were going to get something else.

AC DZ

[Fast 0]

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With a Caravan going for 1.1-1.4 Million and a Otter approaching 1.4-1.7 Million its not a cheap start up cost to get into a turbine airplane. 3 million would get you an airplane, a dozen or so tandem rigs and half a dozen student rigs. Figure in the extra's like hanger space, jumpsuits, etc That is enough to get you started.

Unless the PAC 750 has gone up in price would it not be a better starter plane for purchase and running costs? <$1M
10 Tandem rigs
6 student rigs,
etc...
2 Mill weould cover it.

PLUS Insurance

A new PAC is 1.4M now.

You couldn't just buy a turbine and start a DZ in most places unless you have a pretty well established group of people you're gonna take from another dz. Then on top of that, if you are in a place where there is a market for a decent sized turbine dz, there prolly is one already and you're gonna be pissin in their cereal.

~D
Where troubles melt like lemon drops Away above the chimney tops That's where you'll find me.
Swooping is taking one last poke at the bear before escaping it's cave - davelepka

[Deisel 37]

Thanks for the great insight. But I think that there is a larger issue that can be addressed here. What experience or skill set would best prepare someone for opening a DZ?

Just because I like eating pizza doesn’t mean that I should open a pizza place. I believe that a major reason for start-ups folding is that people get in over their heads and have no idea what they are doing. Looking at it from a business management perspective, it’s rare that anyone can walk in and be an effective CEO on their first day at work.

The brave may not live forever, but the timid never live at all.

[skydived19006 4]

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...it’s rare that anyone can walk in and be an effective CEO on their first day at work.

Another great reason to start small and grow if the market and staffing allow. From my perspective, I see DZs fail because the management is driven by something other than maintaining profitability. If you're starting a DZ in order to make friends, impress skydivers, and of course free jumps, you'll likely not be in business very long. Some of the recent DZ controversy in Missouri is a prime example. SD Arizona wasn't built in a day.

Also, the issues that Fast brought up regarding competition for staff and customers in any market large enough to support a turbine aircraft. ST Louis for example as I understand has two turbine AC DZs and both run on the edge of profitability due to market size, etc. Just an example, my knowledge of the St Louis DZs and market are very third hand.

[soapbox]
I do have a fairly good handle on the Wichita market. We have one Cessna 182 (only DZ within 120 miles of Wichita), from the typical Wichita skydivers perspective, we don't have enough lift capacity. But from the business minded DZOs perspective, that one 182 sits on the ground quite a bit, and on beautiful summer days we'll fly 14 to 18 loads, eight of which are tandems, when if it were turning back to back from 8:00 am until sunset, it would do 22 to 24 loads (larger engine STC). Granted in this market the "typical fun jumper" will show up at 10 to 11 am, and leave by 2:00 to 3:00 pm (DZs only 15 min out of town), so they have a different perspective than those of us who spend 12 plus hours a day at the DZ.
[/soapbox]

Experience is what you get when you thought you were going to get something else.

AC DZ

[stratostar 5]

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Granted in this market the "typical fun jumper" will show up at 10 to 11 am, and leave by 2:00 to 3:00 pm

Yea and they are the ones who throw down the cigs butts, piss on the seat, litter, bitch they can't hop on the next load, won't teach a class, or pack to help out, basic a pain in the ass.

Where I jump, there are the doers and non doers who are the loudest at bitching about everything yet won't help out.. it's a club, not a business... I hear.

you can't pay for kids schoolin' with love of skydiving! ~ Airtwardo

[chuckakers 406]

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anyone have any idea how much it would cost total to own a medium sized dz ??

The correct answer is impossible to say as there are many different ways to pulled it off. I started a Twin Otter DZ (Skydive USA) on $30K. We did it on a shoestring by:

leasing a hangar on a municipal airport - $1500 for first month rent and deposit

leasing an Otter turn-key (thanks Billy Richards) - $0 up front

lease/purchasing student rigs from a DZ that was rotating gear (thanks Skydive Dallas) - $0 down

renting 3 tandem rigs until we had enough cash to buy our own

using LOTS of volunteer jumper help with facility start-up tasks (thanks Houston jumpers)

bartering everything we could think of in jump ticket, tandem, and AFF trade

bartering radio air-time for demo jumps into station events

giving away tandems to local media to get our name in the news

creating a commission program and having fun-jumpers distribute brochures to kick start business

having the wife and I do the bulk of student jumps until volume dictated additional hiring

securing a team to help make loads go until building a fun-jumper population (thanks Deguello)

doing all the cleaning myself - yes, including toilets.

and a million other things to get the job done without money in the equation.



Be forewarned that the low-cost way of doing things is also the low-profit way. But DAMN did we throw some legendary parties. Guess that's how our little DZ earned its nickname.

I still have a headache and some scars.

Chuck Akers
D-10855
Houston, TX

[mircan 0]

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Granted in this market the "typical fun jumper" will show up at 10 to 11 am, and leave by 2:00 to 3:00 pm

Yea and they are the ones who throw down the cigs butts, piss on the seat, litter, bitch they can't hop on the next load, won't teach a class, or pack to help out, basic a pain in the ass.

Here also... Seems that 90% of jumpers today demonstrate this kind of behavior. Especially bitchers who whine because of waiting. You know, the entitled ones.

dudeist skydiver #42

[Andrewwhyte 1]

One of our packers noted the other day, "You know I never really grasped the concept of 'weekenders' until this year.
Yup.

[PhreeZone 15]

What would you say is a reasonable time to wait around a DZ if you are wanting to pay for a jump (aka not staff) while waiting on a load if the weather is nice? I'll draw a line and say if the DZ can't get me up on a load in 2 hours then I will find something else to do that day. This is especially true at a turbine DZ.

Yesterday is history
And tomorrow is a mystery

Parachutemanuals.com

[Andrewwhyte 1]

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What would you say is a reasonable time to wait around a DZ if you are wanting to pay for a jump (aka not staff) while waiting on a load if the weather is nice? I'll draw a line and say if the DZ can't get me up on a load in 2 hours then I will find something else to do that day. This is especially true at a turbine DZ.

I would agree with that. However planning on doing your one jump of the day during peak hours you have to realize that it will be busy. The big difference between a turbine DZ and a Cessna one is that the turbine (in most cases) can turn a buck selling jump tickets whereas the Cessna DZ sells jump tickets to create atmosphere and produce instructors.

[DrewEckhardt 0]

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What would you say is a reasonable time to wait around a DZ if you are wanting to pay for a jump (aka not staff) while waiting on a load if the weather is nice? I'll draw a line and say if the DZ can't get me up on a load in 2 hours then I will find something else to do that day. This is especially true at a turbine DZ.

Never more than the time it would take to drive to the next nearest dropzone without a long wait. At two hours that gives you more than 100 miles to work with.

Where that's not an option and wait times are averaging two hours it may be time to stop being a local jumper and start spending long weekends at the nearest (California, Florida, Airizona) destination DZ once a month.

[Deisel 37]

Good post Chuck,
What kind of a timeline should a start up DZ expect? Every business starts in the red and expects to break even at some point. Anyone know the numbers for a DZ?

The brave may not live forever, but the timid never live at all.

[airtwardo 7]

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Good post Chuck,
What kind of a timeline should a start up DZ expect? Every business starts in the red and expects to break even at some point. Anyone know the numbers for a DZ?

Years ago Roger Nelson authored a business plan regarding the formula for where, and the logical proven how-to on starting up a dropzone.

From what I understand it went into population centers and travel times, economic conditions and the availability of discretionary income for the target market, how to lease what and when to buy, when to expand etc.

I know of a couple very successful DZ's in the US that followed that plan...I've seen part of it probably 10-15 years ago and discussed it once briefly with Roger...he'd really covered it A to Z and it really IS 'rocket science' if you want to go about it with a better than average certainty of success.


These days in the current market even just starting a club type DZ would be pretty tough on a 'shoestring' and would rely on everything going perfect for quite a while to take root and grow...starting a turbine type DZ requires some considerable start up capital and of course even THEN it's a gamble.

IIRC the cost of Rogers professionally produced business plan was 10,000...and that was like 15 years ago.

~ If you choke a Smurf, what color does it turn? ~