Born to repair
Family business finds
success in an off-airport location
By William Otto
November 2000
Otto
Instrument offers instrument service and repair and
autopilot installations. Explains Otto, ?Everything
from antiques to the airlines is what we specialize
in.?
FAMILY TRADITION
Following in his father?s footsteps, Otto grew up in
the business and attended the Spartan School of Aeronautics
in the early 1970s. Otto worked for his father and eventually
took over as the years went by.
?Business
has been very good lately. We?re fortunate it?s been
a steady increase anywhere from 25 to 29 percent per
year for the last few years,? Otto says.
He
attributes this success to a good economy and the company?s
diversification through a large segment of aviation.
?We do work for everything from people restoring antiques
to the airlines and the freight haulers,? he says.
Originally,
the company was focused more on general aviation. ?While
the company didn?t abandon that segment, it diversified
itself through some airline and military projects about
4 or 5 years ago,? Otto says. ?The largest profit segment
of the business is very centered around the general
aviation segment and commercial aviation.?
Expanding
Off-airport
Wth increasing profits, Otto Instrument looked to expand.
The company remained at the airport until about eight
years ago. ?At that time, we outgrew our building, bought
land adjacent to the (Ontario) airport, and built our
own building,? he explains.
On
the airport, Otto Instrument occupied a 6,000-sq. ft.
facility. It?s new building, about one block adjacent
to the airport, is 15,000 square feet and home to 42
employees, double what the company employed at its airport
location.
Otto
says the choice to move off-airport was fairly simple.
?It?s made a difference in that we control our cost
because it?s my building. At the airport we looked at
very large rent increases. They were 300 percent every
five years. And when we saw the costs getting so high
it finally got to the point where we could pay our whole
mortgage on this for what we were renting a small facility
for which was a third this size,? he says.
According
to Otto, remaining at the airport with the increasing
rent costs wasn?t economical for the business. ?We didn?t?
do that much direct work with the individual customers.
It was more a wholesale business,? he says.
A
majority of Otto Instru-ment?s businesses is sent in
to the company from FBOs or radio shops, with Otto Instru-ment
working on a wholesale level with the repair shops.
?We do not have very much walk-in general customer business
at all,? he says. ?We found that moving off the airport
and controlling our rent costs was a big advantage,?
he adds.
Otto
Instrument also still maintains a presence at the airport
to work with Mercury Air Center, where he conducts repairs
on the ramp.
Another advantage to its location, Otto says, is that
the
company is very close to the freight hubs. ?We don?t
have to worry about any problems with late night calls
when we have to respond at 5 or 5:30 p.m., we can still
go right over to the airport and get things shipped,?
he adds.
With
an expansion that has brought the company to double
in size, Otto says, the company plans to continue on
its same course.
?We have to continue on in our present mode which is just an increase in commercial and general aviation,? he says.
