DB aviation
What began as a small charter firm is today a major Midwest player
By John F. Infanger, Editorial Director
May 2000
WAUKEGAN, IL — In 1987, at a time when the general aviation industry was in the deep depths of its long downturn, Dan Bitton founded DB Aviation at Waukegan Regional Airport, located on the northern tier of the Chicago suburbs. What began as a charter/aircraft management firm has grown dramatically since then, becoming the lone FBO and an economic generator for the entire airfield.
Today, DB Aviation encompasses some 39 acres at Waukegan, having acquired the airfield's two previous FBOs while also significantly growing its charter business. With annual revenues now more than $20 million, the company employs some 100 people. Since 1998, it has experienced 26 percent growth in charter, 50 percent growth in hangar occupancy, and 22 percent in fuel sales (2.5 million gallons in 1999).
Comments airport director Neil Otterbacher, "They've taken what was two FBOs that were not doing awfully well and have turned it around, from my perspective. Our revenue through them is a lot more than we ever got through the other two combined."
Bitton credits much of his success to an ongoing emphasis on learning, networking within the business community, and never losing sight of what he calls the two essential elements of any successful aviation business: safety and service. "It's a very old-fashioned answer, but we've grown because of service and a commitment to quality," he says.
Through the years, he says, he has also come to realize that paying a premium for good pilots — 20 percent or more above the Chicago average — helps ensure quality service while also serving to encourage them from moving on to other companies.
"What I get in return is a seasoned guy who's not looking for a job tomorrow," he says.
"It took me longer than it should have to realize that the cost of replacement is more expensive than paying him in the first place. When you look at FlightSafety, in-house training, and recruitment costs, you are much better off paying the top buck to keep people here."
Bitton has taken a similar approach with the accounting department. "Having the spreadsheets in front of you, telling you where you're making money and not making money, changes that accounting department from a cost center to a profit center. And our customers are extremely demanding from an accounting perspective. I'm telling you, most charter companies that lose a customer do so because of accounting," he explains.
The future growth of the company, says Bitton, will rely greatly on strategic alliances with other, particularly small, companies. In fact, it's an approach that he says will be vital for much of the industry.
"We need more locations," he says. "It could be through the acquisition of smaller charter companies — ideally, the two to four aircraft operation that has a young entrepreneur who is undercapitalized. But it might be that instead of acquiring them, we will form teaming agreements where we share our chief pilot, our director of ops, dispatch, and accounting. That's been my dream, to centralize some of the more expensive things.
"If we're providing dispatch for six operators and somebody calls for a charter in a particular area, we send in the charter company that's in the area. We still get a percentage. It doesn't have to be us; we could use their people.
"The industry needs to cut costs."
Learning from customers
Bitton also credits much of his business success to his customers, who
he says taught him early on that savvy networking can go a long way in
building relationships that later will turn into revenue for the company.
They can also become significant investors in the business.
"They have the financial means to make these investments and many of them like these types of investments because, to quote an old adage, they like aluminum," he explains.
"Actually, they're kind of tickled when you approach them.
"I think there's some apprehension on the part of small operators to go to their clientele because they may be perceived as not financially secure. I took a different approach; I told them exactly where we were financially and even sent them my financial statements."
He adds that he also learned to use them as mentors, even creating a board of directors on which customers serve. And, he says, when the financials have indicated the company was in a cash flow pinch, it was his customers who helped show him how to turn the situation around. His mentors include former DOT Secretary Sam Skinner, a former U.S. attorney for President Bush, and CEOs of large companies.
It was these advisors, he says, who also directed him to make networking with Chicago business leaders a priority, one that took him away from the cockpit. "For a small company that can't afford a lot of salespeople, it's a great opportunity," he explains. "I'm much better off being down at the Chicago Club with 30 CEOs than in the cockpit. I can do more good for the airport and my company.
"It's fascinating to me how you can go to these meetings and never talk about an airplane but still do business. Again, that comes from my board members. They said, ’Dan, don't talk about business; people will know what you do or will ask. Just be upbeat and don't try to sell them.' It works."
A Maverick Attitude
Bitton admits that he may not be in line with the approach many FBOs and
charter operators take to the industry and issues facing it. For example,
regarding flight and duty time, he says there should be one standard for
all pilots, whether Part 91, 135, or 121.
"While it's going to be expensive, I would rather the same standard apply to everybody; the rates would change across the board. Quite candidly, I think it would be a safer standard."
He also embraced the fractional ownership programs early on, unlike some in the charter business. "I see them as a resource," he says. "They came to me and said, ’We're going to bring you a lot of business; we want better rates.' I said, ’If you're going to give me a lot of business, I'll take it, but my rates either stay the same or increase.' To hire more pilots and maintain our standards, it's going to cost me more money. They all said OK." He's also learning more about airport management, and will attend a AAAE session on Part 139 certification in June. "I owe it to the company to know what's going on, whether I have the best airport manager or the worst," he says. "AAAE offers all the relevance in the world to an operator on an airport to know what's being done in the lobbying world and the regulatory world."
Out of Tragedy, Radar
On February 8, a mid-air collision at Waukegan Regional led to the death
of three people, including Chicago radio personality Bob Collins. One
positive arising out of the tragedy is the airport will soon have radar
installed.
"Bob and I owned the airplane together," explains DB Aviation president Dan Bitton. "He was my best friend.
"Radar would have been a big aid to the controller, so I became a focal point in trying to obtain that radar. Afterwards, I thought, I can get angry, I can pout, or I can do something about it." Bitton says he personally lobbied state legislators, who in kind contacted FAA to call for installation of the radar. The issue also came under ongoing scrutiny of the Chicago media. In late March, FAA announced Waukegan would soon have a TARDIS radar system installed.
Bitton says he isn't stopping there. "Doing something also means working to get radar in every tower in the United States that doesn't have it. I really think every airport executive needs to be lobbying very aggressively for this.
"We didn't meet the criteria. I believe FAA created the criteria with good intentions because these things cost a million dollars years ago; now they cost $10,000. The price changed, but FAA didn't lower the criteria. You don't have to be a big airport to have this."
CAPS Dan Bitton's company holds leases on some 39 acres at Waukegan and has aggressive plans for expansion on its nine unimproved acres. DB Aviation's memorial to Chicago radio personality Bob Collins DB Aviation places a strong emphasis on training, not only sending pilots to FlightSafety and Simuflite, but also putting on aircraft rescue training once a year at Waukegan Regional. Explains vice president Michael Bitton (inset), "We actually take a $15 million Learjet, put it out on the ramp, and dump $10,000 worth of foam on it for practice. We have firefighting people here from five, six airports and about a dozen fire departments. We do evacuation training where we put employees in the back of the airplane and get a smoke generator and fill it with smoke."
