Building on Experience

Sept. 5, 2014

MEMPHIS — The Wilson Air Center based here at Memphis International Airport was recently voted the No. 1 Best Small Chain of fixed base operations by Professional Pilot magazine. The award follows a nine-year run as a top U.S. FBO by Aviation International News. For Wilson Air Center president Bob Wilson and general manager Dave Ivey, the awards are in essence certification of the goal they had when they started the FBO group — to be a leader in customer service.

That mission comes from the roots of the organization. Wilson Air Center was founded by Bob Wilson’s father, Kemmons Wilson, who was renowned as the founder of the Holiday Inn franchise, which revolutionized the hospitality industry in the 1950s.

Explains Bob Wilson, “Execution and people are everything. Period, end of story ... I think what we have done, what Dave and his folks have done, we have raised a bar in this industry. We push and demand excellence. There’s not anybody in any of our facilities that says, ‘I’m not going to go out and help.’ Everybody’s expected to leave what they’re doing immediately. Our CFO will be out there wing-walking if we need it or what-not.

“We’re like a family. If somebody hurts, everybody hurts, and from that side I think we have a family value here.”

GM Ivey relates that the industry has significantly changed since he came on board in the late ‘70s and ‘80s, when FBOs typically were expected to offer a full slate of services, from flight training to aircraft sales to maintenance, which led to them focusing on balancing one profit center against another. The advent of a changing regimen in which fuel sales and customer service became primary drivers, driven by the changing business aviation sector that was led by the fractionals segment, brought with it a need for a change in how FBOs operate, says Ivey. Such an environment, he says, fit well with what the Wilsons were attempting to bring to the marketplace.

He explains, “Coming to Memphis in ‘96, Bob hired me to start the facility, and back in the ‘90s FBOs were a little bit different. My first FBO I worked for, we had a hundred employees; we were a full-line Cessna service center, avionics, parts, aircraft sales, flight service, charter; and so at any given time, if avionics and service were slow one month, charter and aircraft sales picked it up; and if line service was slow selling fuel, maybe avionics and service picked it up on that month. Well the industry’s changed considerably since. Instead of offering a wide variety of services, FBOs just offer a very specific product — fuel.

“So that’s one of the biggest changes I’ve seen in our industry since coming down with Bob is just the specialized services aspect as opposed to the 360-degree offering of services, and that’s been driven actually by the consumer. The consumer doesn’t necessarily want to go to a small maintenance shop anymore; they want to go to a factory-authorized shop, they want to go to a full-service [Part] 145 repair station.

“And we’re still winning awards. Part of the matrix on how we win those awards is we’re being able to deliver the service — what we call fair and equitable pricing. How do we do that is, we try not to over-extend ourselves on acquisitions. If we did, Bob would’ve bought probably three, four, five other FBOs, but we just did not feel it fit the business model from the point of, if you overpay, you’re going to have to increase prices, cut capital out, or decrease service.”

Besides its headquarters base at Memphis International, Wilson Air Center also operates FBOs at Charlotte and Houston Hobby, and will open a new fixed base operation later this year at Chattanooga, TN.

Management contracts, and controversy

At Memphis and Houston, Wilson Air Center owns and operates the FBOs. At Charlotte and now Chattanooga, it operates them under management contracts with the airport sponsor.

The ongoing five-year management contract for FBO services at Charlotte came about after a Signature Flight Support lease came to term and long-time airport director Jerry Orr decided to take the operation in a different direction, one that gave the airport more control and flexibility. Wilson Air Center responded to a request for proposals to run the operation. During the review process Bob Wilson encouraged Charlotte board members to come see his Memphis operation first hand, which they did, and which subsequently resulted in his company being awarded the the contract.

Recalls Wilson, “We went back and re-did the old Signature place. It was kind of interesting because we had people who left that morning with Signature and when they came back they were with Wilson along with a whole different way they were handled.

Wilson Air Center has a similar contract arrangement at Chattanooga, hired to operate a new FBO terminal facility built by the airport and which will compete with current tenant Tac Air. The facility has drawn its share of criticism, brought on by the National Air Transportation Association and others who charge that the public airport is competing with private enterprise, possibly using federal grant monies in the process.

Bob Wilson looks beyond the argument, citing economic growth in the Chattanooga region spurred by investments by automaker VW and bookseller He says he had looked at the Chattanooga market some eight years earlier, but the market wasn’t developing yet. When the airport called and suggested he consider bidding on the RFP for the management contract, he took a second look.

“I think the beneficiary of what’s going to happen over there is going to be the guy flying the airplane, without any question, whether he goes to TAC Air or goes to us, he’ll be a beneficiary.

“We decided to bid on it; as far as what the airport did and how they did it, talk to them, I do think one thing we had a conversation about is, they really have a nice front door now, which I think the city lacked. At Memphis, we sell ours as the front door.

“It’s a [five-year] management contract; that’s what we bid on. They pay us a yearly fee plus a percentage.” Regarding pricing, he says, the FBO makes recommendations and the airport makes the decision.

“Personally, I think it’s a long-term play. I think Chattanooga needed a front door.”

When asked about the controversy regarding the airport, which has been offering some airline services and which some assumed would operate the new FBO terminal, Wilson responds, “I’m just looking at it as an opportunity for us to use our expertise in the FBO side, and for our corporate customers. We’ll service large aircraft if we can, like airlines. I sincerely think the aviation community is going to benefit when they look back on it."