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Read your audience

I took a sales class in business school years ago.  A decade later I still think about it often.  As a matter of fact, of all that I learned in college the lesson I learned in this class might have been my most valuable; read your audience.  Actually, the semester long study was about personalities and how a sales person will have greater success if you can quickly learn your client’s motivations and style. 

In my business I try to pay attention to a prospective client’s style or a prospective airplane buyer’s attitude.  If I’m showing an airplane to a buyer I can either sit on board or stand way back.  When I receive an offer from a prospective buyer, I try to respond within the format of the document that they have sent.  If it is long and complex then we can detail all of the business points.  If it is short and simple, I work to protect my client’s best interest while not making the document too detailed.  My goal is to keep the focus on the primary objectives of the task.  You can only do it if you read your audience and try to understand their goals and objectives before you respond.  It pays off every time.

The most challenging time I have implementing this lesson is when responding to requests for proposals (RFP).  Without any sort of real interaction or knowledge of who will ultimately review the proposal and who will make a final decision it is hard to have any idea of the recipients’ motivations.  It is easy to factually answer questions.  It is hard, however, to understand what will ultimately drive their choice.  Of course all aircraft sellers want to find the broker that will best represent their interests and sell the aircraft.  But, I don’t know if they are ultimately looking for the best personality fit, a long term relationship or the lowest cost provider.  None are bad, they are just very different.  Over the years, we have won some and lost some RFP processes.  Most of the time the prospective client’s decision is made without any discussion and are based solely on the response in the written proposal. 

We were recently selected as one of three finalists in an RFP process.  The prospective client asked all three finalists to fly out and meet with them in person.  Last week my technical director and I flew out to meet with the selling company.  I was proud to be included on the short list both because I had clearly done a good job in preparing the proposal and because of the respected peers whose company I was in.  Regardless of who wins the business I know that it made a difference for me and for the seller to sit across from each other.  We were both able to better “read our audience” to best understand each other and see who was the best fit for the project.  Hopefully this week we will learn who won the business.  Regardless, the seller had three good choices and I know that whoever wins will be the best fit for the seller because of the chance to really get to know each other by sitting across the table from each other. 

The parting thought is not about requests for proposals, but it is about reading your audience.  In anything I do in my world I try to always read my audience before engaging.  It is strange to think that it has been a decade since I graduated college, but I like that after all this time I am still thinking about and practicing the lesson learned.  I should try to find my old professor and send him this post.  I know he would be proud!

Peeling back the layers of the onion…

As a buyer, especially in today’s supply rich environment, it is easy to look at thirty aircraft in a specific market and consider them all the same.  But, the truth is that below the surface they can be very different.  For example, we are selling a Gulfstream GIV.  On the surface this aircraft is just another 10,000 hour Gulfstream IV.  However, if you look a layer deeper, this GIV has a full engine program, an upgraded APU and great avionics including HUD and triple FMS to name a few items.  Peel back another layer and you will see that it has almost every ASC modification ever issued complied with.  Another layer still, it has been owned since new by one of the largest most well respected flight departments in the country, it has no real major damage history and the cosmetics are in very good condition.  Once you have peeled back the layers, this GIV is no longer lumped with the rest, but when all of this value is combined with the price that we are asking it shines as one of the best aircraft and best values in the market. 

As a seller it is incumbent on our firm to help peel back the layers of the onion for the buyer so that our listings don’t get lumped in with the rest.  A similar story applies to a Falcon 2000 that we are currently selling.  When the onion is whole, the story is no different from the rest; it is just another 6,000 hour 1999 model Falcon 2000.  One layer at a time, however, the aircraft story unfolds….it has a full engine program.  It has a ten passenger interior.  It is loaded with avionics including HUD.  It has one of the highest levels of service bulletin compliance of any Falcon 2000 in the fleet.  It has been owned by the same very large public company with a large global flight department since new and used for worldwide operations.  It has no major damage history.  The cosmetics are good.  And, the owner has its replacement aircraft in service and they are ready to sell at the right fair market price.

It is hard to describe true aircraft value in a spreadsheet, but if we are going to help the “value buyers” who I described in my last posting find the true value aircraft, it is incumbent on us as aircraft sales professionals to help peel back the layers.  As a buyer’s agent, it is equally important to help our clients look past the outside skin to the sweet inside and identify the best value in the market, not just the least expensive.  In the long run the best aircraft and best value will prove to be the best investment.  That is exactly what we try to do for every listing we represent and in every conversation we have with a prospective buyer – look past the outside skin to the inside layers and to identify the true value of an aircraft.    The value buyers are coming back and now we can sell the true value aircraft.  We are on the right path and it feels good!

The return of the value buyer…..

For the last two years we have seen a lot of “opportunistic buyers” instead of “value buyers” enter the market.  To me, an opportunistic buyer is one that comes into the market focused solely on price.  They are not as focused on airplane type and are not entering as much because they have a need for the asset, but because they believe they can make a great buy.  These buyers call a lot of sellers and make offers with the feeling that if they can buy for their price (often well below market, even in our seriously depressed markets) then they will buy.  If they can’t, they will look for something else and move on until they find something that they feel is a true “opportunity.”  You can’t fault a buyer for this, but if they are buying to use the aircraft and not to flip it like an inventorying dealer might, then they are missing the true value and best investment.  They are only making a short term gain and not a long term smart acquisition.  My father often quotes a famous motivational speaker, “price is a one-time thing, but costs are a lifetime thing.”

A value buyer, however, enters a market out of a need for the asset for personal use or business use.  They know their mission and what aircraft type will best fulfill it.  They study the market and analyze the options.  The value buyer will work to make the best buy they can and get the most for their money, but the driving factor is not the “opportunity,” it’s the aircraft.  Consequently, it is the value buyer that ultimately buys the best aircraft and makes the best investment because they are focused on the asset and not the just the price.  As a buyer’s agent, we help our buyers make the best value buys at the best possible price.  As a seller’s agent, we work to define the value proposition of each listing so that the “value buyer” can quickly and clearly distinguish the benefits of the aircraft.

Today, value buyers are coming back.  They are entering because they have confidence that we are at the bottom of the market and the free fall is over.  They are only buying with a keen eye towards capital costs and go-forward operating costs, but because they are focused on the asset they are making the best investments.  It is the value buyer that will lead us back to a normal market and it is the value buyer that will win in the long run.  It is good to see them coming back!

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