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Study Shows Business Aviation Grows Companies

November 1, 2012

Owning a business aircraft makes companies more competitive and successful, according to a newly published study from NEXA Advisors, LLC, which was presented to Attendees on Oct. 31. during an NBAA2012 education session titled “Light Business Airplane Mission Critical: Using Aviation to Grow Your Business.”

The study is the fourth in a series by NEXA that shows the value business aviation has for companies of all sizes, as well as government agencies. The latest report reveals that even during the worst economic times since the Great Depression, companies using a business aircraft outperformed those who didn’t in important measures of shareholder value. These companies also recovered from the recession faster than their peers across a range of industries.

Titled "Business Aviation: Maintaining Shareholder Value Through Turbulent Times," the study found that S&P 500-listed companies that use business aviation achieved superior financial performance in a number of key measures and also displayed a superior ability to respond to the severe downturn. It also found that 84 percent of corporations listed on the S&P 500 use business aviation, including all the top 100 companies, according to Tulinda Larsen of NEXA.

Additionally, these companies were rated among the leaders in a variety of key measures by several of the nation’s leading business publications. For example, of the 100 companies in Business Week’s 2012 “100 Best Brands” survey, 48 S&P companies were included. Of those, 96 percent use business aviation. And, of the 50 companies found in Fortune’s 2012 “50 World’s Most Admired” companies list, 43 S&P companies were included. Of those, 95 percent use a business aircraft.

Other important key findings include:

  • Companies not using business aviation during the recession lost profitability and employees, and even dropped off the S&P 500 rankings at far higher rates than companies using business aviation
  • Use of a business aircraft has a positive impact on enterprise resiliency following what NEXA termed “the Great Recession” period of 2007–2011.

For example, the analysis found that jobs at a diverse range of companies that use business aircraft not only recovered, but also have grown beyond pre-recession levels, while non-user companies have recovered at much slower rates.

The study was commissioned by NBAA in conjunction with the No Plane No Gain advocacy campaign, which educates policymakers and opinion leaders about the value of business aviation to citizens, companies, and communities across the United States. The campaign is jointly sponsored by NBAA and the General Aviation Manufacturers Association.

Owning a Plane Makes a Difference

Following the NEXA presentation, Brad Pierce, president and CEO of Restaurant Equipment World, outlined the advantages owning an aircraft has brought to his company, which services more than 100,000 customers internationally. Piece started flying for business about 12 years ago and now logs between 500 and 600 hours per year flying himself and employees for business purposes. The company uses the aircraft not only to meet with potential new clients, but also to service existing ones.

Pierce said the aircraft gives him the ability to fly to clients on a moment’s notice. In a single trip, he might make four or five stops along the way. He said by including employees on trips and explaining the advantages of owning an aircraft, they support the company’s use of business aviation.

“We have a saying out our company,” he said. “When the wheels of the airplane hit the ground, the cash register rings.”

Pierce also offered some advice to those thinking of buying a plane for business use:

  • Hire an advocate to assist with the aircraft purchase and insure your company sets up expense and reimbursement policies properly to avoid penalties and other issues with the Federal Aviation Administration and Internal Revenue Service.
  • Make sure the flight log lists only details associated with business trips. Any personal details could lead the IRS to disallow business expense claims.

Learn more about business aviation and download the NEXA study.

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No Plane No Gain