As with any mode of transport, planes have a limited service life. There will come the point where an aircraft may require a six-figure sum to overhaul its engines, for example. As you can imagine, such a repair bill isn’t cost-effective for owners or aircraft operators.
So, what happens to those plans when they’ve reached the end of their usable life? The answer is simple: they get stripped for parts and scrapped. Around 90% of an aircraft can be recycled, either as a raw material base or for other working planes.
Admittedly, launching an aircraft salvage business is not the first idea that springs to most entrepreneurs’ minds. However, as a startup business idea, it’s viable and profitable – if you do it right. To that end, here’s how you could set up such a business.
Is There a Market for Aircraft Salvage?
In a word, yes. Thousands of individuals and companies operate fleets of airplanes around the world. As you can appreciate, buying new parts for those aircraft is both costly and time-consuming. Buying new plane parts is expensive because you can only buy them from the aircraft or part manufacturer. And the process is time-consuming due to some parts having a long manufacturing lead-time.
Aircraft operators favor used but good-condition parts because they’re cheap and relatively quick to receive. As a result, there is a high demand for used aircraft parts. And the things you cannot sell are still recyclable.
How to Set Up an Aircraft Salvage Business
Believe it or not, the process is the same as with any other type of business. You need to conduct market research and decide if you’re going to specialize in a particular niche.
You should also create a business plan to determine your startup and ongoing costs, and, of course, your potential turnover and profit. You’ll also need to find out whether you need specific licenses to operate as an aircraft salvage business.
One thing that might put some entrepreneurs off is the startup cost. Buying old aircraft might only cost a fraction of their new value. But, you need to factor into your costs the price of shipping each aircraft to your salvage yard.
How to Sell Aircraft Parts
Some parts from end-of-life planes end up on online marketplaces like eBay. However, there are specialist marketplaces such as ILS Mart, where you can sell your salvaged aircraft parts to customers.
It’s worth creating a network of aircraft parts buyers as you can also sell directly to those individuals and plane operators. You may even wish to set up an online marketplace where members of the public can view and buy anything you’ve got for sale.
Should You Go It Alone or Team Up with Someone Else?
One final point to bear in mind is whether you want to set up an aircraft salvage business alone or with another person. Going it alone means you get to keep 100% of the profits. But, teaming up with someone else gives you access to higher startup capital.
It’s worth spending some time thinking about which option is best for you.