Gaining Knowledge: Raising broker standards

In a world where the number of HNWIs continues to increase there is an opportunity for private aviation to grow alongside. And, if more brokers are attracted to the industry, should ensuring professional standards be a priority? At a corporate level, ARGUS and BACA introduced broker accreditation last year, but here we are looking more closely at the individual broker level; the implications of training and of gaining experience. Should broker standards be raised?

Tim Procter, managing director of UK-headquartered Air Charter Travel reflects: “It's amazing to think that if you were conducting a personal financial policy transaction with a value of say £100,000, you would have had to have studied and passed various exams laid down by the financial services authority, whereas an aircraft charter broker can manage a transaction for twice that amount without having passed any exams or having any formal qualifications whatsoever.” It would seem logical, particularly in this increasingly litigious day and age, that there be some sort of application for certification. However, given the broad range of brokers in the industry, from the chap in his front room to the multinational company employee, from the chancer to the expert, is it too difficult to apply standards to cover absolutely everybody?

Getting a good grounding

There are, of course, institutions that are specific to aviation, though not brokerage, and others that simply offer aviation related courses. Adam Steiger, president of Florida-based Air Charter Advisors (ACA), believes this is because there is currently no required licensure or certification for becoming a broker, or acting in a sales role selling private aviation products.

However, these courses do give a good grounding in operations, the airport environment and the principles of aviation. Clive Chalmers, director, commercial jets UK, of UK-headquartered Air Partner says: “The air transport management degree at Loughborough University is a popular one, with a number of the team here at Air Partner having completed this course prior to joining the industry. There is also an aviation studies/operations course available at East Surrey College which again is popular, and which I myself completed some years ago.”

Course content may focus on piloting, dispatch, and commercial aviation, and charter sales director Victoria Reina-Duffy of Jet Aviation USA suggests that more in-depth business aviation knowledge may be achieved by taking a National Business Aviation Association (NBAA) course. “Additional education will help the broker community learn more about operations and assist in safer flying for customers.”

Broking business air charter is a niche area that constantly evolves, and Matthew Savage of UK-based Smart Aviation feels that it is right that courses focus on giving the individual exposure to the wider aviation industry. But the challenge is always to ensure that exposure is real, and current. Manager of the executive charter team at Hunt & Palmer Julie Black says: “These students may undergo work experience with an operator, handling agent or airport authority, although we have taken many ourselves so clearly brokers are an acceptable form of aviation experience too.”

Growing industry/education links

UK broker ACC Aviation has recruited several graduates of aviation management degrees, and has worked with a university to provide an industry placement for a team member who has since joined the company full time. Another graduate recruit has recently returned to his university to present to graduating students.

For the last year ACC has been running a trainee development scheme. Over the course of 18 months, each candidate is mentored by an experienced consultant who provides support and coaching. The comprehensive syllabus encompasses client development and operational training through to the processes and procedures for chartering and leasing aircraft.

Director of charter and operations Glenn Hogben explains: “It's our responsibility to support those who will be taking the industry forward into the future.” The company has taken on a number of sandwich course and work placements over the years, but this scheme will focus specifically on developing those without industry experience. Following a full induction, with the first six months dedicated to building general aviation knowledge and understanding client relationship management, it transitions to operational training, which includes visits to operators and airports and opportunities to get onboard a variety of aircraft types. Provided the candidates pass these stages, they will then begin to learn the processes and procedures for chartering aircraft. “The programme is rigorous but taking this time to properly develop employees is vital,” he adds.

Quality means doing it right when no one is looking – Henry Ford

Every company is different and therefore its core values and missions will vary. Air Charter Advisors uses a consultative approach towards customers' needs and discourages pressurised sales tactics by its staff. However, it's a difficult and competitive industry. Steiger says: “Employees who are looking to experience success in this business should realise that much of it comes from perseverence, determination and luck. It may be that you make 500 calls and only one person takes it further. It is difficult to find clients who are willing to work with a new voice over the phone, to entice them to buy into your service and, most importantly, become a long-term customer.”

Kady Braeckmans, commercial executive at Engel & Völkers, Luxembourg, points out that while a degree is important, the qualities of flexibility and superlative customer service are of the utmost importance. “This is a job in the luxury sector and a broker has to dive into a world inhabited by a happy few and understand their needs, even if they think it's a bit over the top.” she says. “Private jet customers have very high standards and are very demanding, and must be taken care of with elegance and patience. An eye for perfection is essential, as well as a well-groomed appearance and an ability to perfectly understand and anticipate their needs.”

A passion for aviation

Starting up a brokerage company tends to be done by people with aviation experience, but what do they look for in new employees? Procter says: “I might be a little biased in answering this question as I come from a sales background, but I believe in the old adage that people buy people first and whatever else afterwards.” Personality is key; when someone wants to charter an aircraft over the phone, or in person, they have to like the broker on the other end of the line. It's the same whether they are buying a flight, a car or a washing machine.

But no matter how likeable you are, you have to have aviation knowledge. “That's irreplaceable and fundamental.” continues Procter. “You've got to know the difference between a single and a twin, pressurised and unpressurised, an IFR and a VFR.”

Savage selects his new employees upon their ability to win and retain clients as Smart Aviation has all the tools needed to cover industry learning. New employees need to ensure they balance their sales ability with a genuine understanding that aviation is a complex and dynamic industry.

“Too often we come across clients who have been promised the impossible by other brokers who are too good at sales, but have no obvious idea about the realities of aircraft operations,” Savage says. By balancing the two sides to the role, aircraft expert and salesperson, his clients are well informed and this in turn leads to greater client retention.

Making a first impression

At entry level, both the CV and the first interview are crucial. It is the candidate's opportunity to create that all-important first impression. “If a candidate cannot sell themselves then you could argue that they would struggle to sell an aircraft charter to a potential customer,” says Chalmers.

At a higher level, Chalmers wants people with knowledge to help grow the business and so looks for both experience and proven ability within the charter market. He adds: “The one thing that is consistent for every position is the customer focus, the right attitude, and a passion for the job.”

The base line for a broker is excellent customer service according to California brokerage Le Bas International COO Tracy Deakin, who suggests that someone from the hotel business would make a perfect candidate, with other desirable attributes being a knowledge of the world, computer skills, and languages. But all this is irrelevant without enthusiasm. “We are not looking for people to do a 9-5 job. We want people who are keen, interested and excited. It's all about passion; if you don't have it, don't come here.”

A can-do attitude is essential adds Jack Cheung, business analyst at Hong Kong-based Jetsolution Aviation Group: “You can hardly say no to the client when they need to fly in the next couple of hours for a G20 meeting.”

A positive attitude and friendly personality go a long way. Reina-Duffy adds: “If you are not a team player, you will not succeed.” The ability to work within the group, enthusiasm and close attention to detail are also priorities.

Experienced brokers may bring certain operational knowledge with them but this can be limited by geography or market sector, and by what Black calls the culture of the brokerage firm. A trainee needs to be able to stay calm under pressure, to both buy and sell well, and to build relationships with clients and suppliers. So many people rely now on email and other electronic forms of communication but this does not necessarily build effective relationships. Brokers should want to talk to people. “It's amazing how many people shrink away from actually picking up the phone,” she says.

Quality is everyone's responsibility – US scientist W Edwards Deming

Steiger finds that the best way to become an expert broker is through on-the-job training, and ACA training covers both sales and aviation. “It works in the same way that someone interested in learning a new language will learn best from full immersion,” he says.

Air Partner too has its own learning and development department which educates every new starter during their induction. The modules cover procedures, policies and best practice guidelines. New brokers are shadowed by designated team members so that they can get used to applying the policies and practices on the desk in a trading environment. But Chalmers notes that external training is valuable as well: “It's good to have an outside perspective and we have made use of external training courses run by BACA and the UK Operations Manager Association, which new brokers always find beneficial.”

At Smart Aviation new staff members are exposed to working situations on visits to airports and operators. Here they oversee departures and make sure they are engaging with staff so they fully understand what they are selling and how to give accurate guidance to the client. New recruits have also attended BACA training days. These cover a variety of topics at different levels, but as an association of volunteers, resources are limited. Last November's cyber crime forum was part of its specialist training offering, and the comprehensive conference programme at ACE'17 will offer a mix of basic training and complex issues such as finance and insurance. “Feedback is welcome,” says BACA chairman Richard Mumford. “The Council is always looking to develop new training ideas.”

Broking knowledge stretches into air law, currency, operational constraints, contracts, invoicing and more, and it is right that it should take some considerable time to become competent. Procter reflects: “Unlike years ago, when we used to take students on they would probably undergo only about two to three hours of daily training for around six months, although the rest of the day would be hands-on.” The students weren't segregated completely from the operation, but could see exactly what happened in the office, answer the phone and sell. “And this way we could see whether they were applying that learning to the job.”

Can you quantify the value of experience?

When Engel & Völkers started up two years ago the team had years of private aviation experience between them. But Braeckmans says: “The day we expand our team, we won't be selecting brokers based on their aviation experience because we might miss a real talent.”

Although the charter broking industry has grown significantly over the years, it's still a relatively small pool of people that have direct charter experience, especially over a sustained period of time. So these people are an important asset to the organisations they work for. Chalmers explains: “It's not just a case of knowing how to put a deal together, it's the operational aspects too, such as knowing which is the most suitable FBO to use, what airport opening hours are, are there any performance restrictions in place? That's where you add real value as a broker, and you only get this through building experience and working alongside people that have this experience.”

Private jet charter broker Nevena Manojlovic of Begrade, Serbia-based Stealth Aviation suggests: “Having aviation experience reduces the period of adjustment, you already have your own client portfolio and everything is much easier.” But Deakin explains that Le Bas does not look to employ someone for their client base but rather their expertise, their ability to speak to a client and deliver a product.

However, Black picks up on the point that experienced brokers tend to come with a price tag based on years in the industry. They may also bring a perceived client portfolio: “Which is not always a true reflection of their broking ability or skills with key clients and suppliers.” A candidate with several years of experience can hit the ground running from day one. They know how to pre-empt issues and to check positioning flights, weather and potential problems before they arise. Savage adds: “A team that has experience of airline operations can understand issues like slot restrictions and explain them to our clients in a realistic informed manner, rather than just blaming operators or over-promising to clients.”

Keeping control of the charter

Steiger has a checklist in place and ACA's involvement begins prior to procuring the aircraft for each flight. It continues throughout the duration of the trip and post-flight as well. The checklist focusses on such things as keeping safety due diligence reporting up-to-date, ensuring the itineraries are correct with tail and crew changes, flight following and following-up with catering and ground transportation arrangements. “It is most important to set realistic expectations with customers, and to maintain contact with them throughout the flight arrangements,” he says.

Air Partner has 24-hour customer service support that 'flight watches' all charters in progress. They may call the handling agent to check an aircraft has departed or use CFMU and Flight Radar 24. “It's vital for us to be able to know the status of a particular charter at every point in time as that forms part of the customer service we deliver,” says Chalmers.

There is potential for any number of things to go wrong on the ground or in the air in what Black calls a remarkably abstract process. “We send emails and make phone calls, and somewhere in the world an aircraft moves and a multi-million dollar business deal is done, or a rock star steps onto a stage and plays a show to a stadium full of 80,000 adoring fans. You can't possibly take your eye off it for a moment.”

How technology helps

Le Bas customers want to be able to talk to someone. “We are servicing clients who just need an arm around the shoulder from someone who asks 'how can we help you?', and then takes care of everything,” says Deakin. But while there is a strong argument for keeping technology out of customer relationships, there's no doubt that behind the scenes it plays an important supporting role.

The Returnjet broker account team communicates continuously with its 850 registered professional brokers worldwide and has first-hand insight into their day-to-day activities and the huge variance that exists in terms of their working practices. The platform updates aircraft details including performance limitations, cabotage, political restrictions and crew duty limitations. “We don't want to waste everyone's time by showing an aircraft for a flight that it can't perform,” says aviation director Steve Westlake. “However, the area where we see less standardisation is that of operator interaction.” There seems to be no standard approach to the quality and robustness of essential trip information provided by brokers or to the ongoing management of a charter through the platform, and he sees a key role of the platform as helping shape standards and best practice within the industry. “While we provide the mechanisms to search and select based on specific criteria, including factors such as ARGUS rating, not every broker chooses to use these. In the same way, rather than conducting an end-to-end, search to booking function, some choose to use us just for search and then take the booking offline.”

Raising standards is essential for safe flying

Steiger sells flights at an average of $15,000 each, with payment via wire transfer. Some flights are priced higher than the average purchase of a new house, and some cost even more. “Just as realtors and financial advisors are required to take courses and have certifi-cations, it would be great to have something in place like this for brokers,” and he suggests that within the US the FAA, the DoT or the National Transportation Safety Board could step in and introduce some form of certification. A six-hour course on ethics, with maybe some level of background check, would be a start. With no barriers to entry anyone can become a broker overnight, which does bring into question the level of competence. “Raising standards would only help our small community and this is something I wholeheartedly support. Any company that is not willing to participate in this is not in this business for the long run,” he says.

“Good broking is still an art,” says Savage, who notes that clients sometimes fall for the sales talk of inexperienced brokers, especially ones that are prepared to work for no margin. “I would like to see more emphasis placed on being a member of BACA, but also for it to be more difficult to join, and to continue to be a member. Certain standards need to not only be met, but maintained over the longer term.”

Just trying to keep my customers satisfied – Simon & Garfunkel

Steiger breaks down the elements of a flight so he can establish whether the customer is happy with the plane and the crew, and all those things outside of his control. “A flight delayed due to ATC or weather, or something as simple as the ground transportation company having a flat tyre, can negatively impact the experience.” As with all our contributors, he requests feedback after every flight. Although when customers use ACA again, or recommend their friends and colleagues, he has to be fairly sure they were satisfied.

The majority of issues faced by Smart Aviation are normally outside of its control in the form of operational issues or oversights by operators. “We are constantly monitoring feedback against certain operators, and if we see signs of a decline in operational standards then we will avoid using them again,” says Savage.

It comes down to the careful selection of suppliers. Chalmers adds: “We are entrusting our brand and our service delivery to any number of third parties every day, so it's in our interests to ensure that we have the confidence and trust in our suppliers' ability to deliver so that our customers continue to use our services.” Having the benefit of a global network of offices and 55 years of trading experience means that Air Partner can give its brokers access to a wide database of trusted suppliers built up over time.

The point of certification

Trust is built at client level in day-to-day business dealings, flight by flight. At a corporate level, says Procter: “The point of applying standards is that it enables the concierge of the Four Seasons hotel, whose job it is to book a Gulfstream V on behalf of one his very wealthy guests, to easily recognise that the broker is properly accredited and therefore reputable.”

Switzerland-based LunaJets was the first broker outside the USA to receive ARGUS broker certification back in 2015. CEO Eymeric Segard says: “We voluntarily requested and pushed for this certification to separate our financial stability, long-term growth plans, values, marketing materials, charter procedures, professionalism, and transparency, from 'one-man broker shops'.”

PrivateFly CEO Adam Twidell says the accreditation process was a very positive experience, and even helped to raise some ideas for the future evolution of the company. The certification helps not only clients but operators under-stand that accredited brokers are working professionally in the interests of a long-term relationship.

ARGUS director, safety analysis, Ed Wandell explains that the CHEQ Ratings programme was developed in 1999 specifically for users of charter, not the operators. Brokers were part of the development process, and continue to provide input. ARGUS began evaluating brokers at their request, with input from industry leading brokers, BACA and consultants who were experts on the existing regulatory environ-ment. In the absence of regulatory oversight, brokers who knew they were adding value to their client relationships wanted to differentiate them-selves from those folks with just a phone and a website. “We continue to improve the standard. The system learns from each audit and as the industry continues to grow, the standard will grow with it,” he explains.

Policies are enforced through a complaint programme. If, after investigation, someone is found to be in wilful violation of the standard, the rating can be removed. The 'pledge' required from all ARGUS registered and certified brokers is actually the BACA pledge, used with their permission. The intention is for the broker industry to meet established standards and to police each other. If a few 'bad apples' bring unwanted attention from the regulators it could result in increased regulation. “In the absence of overarching regulation, this is the best path forward,” Wandell adds.

Rick Colson, president of Wyoming, USA-based New Flight Charters, talks of the importance of company commercial ratings. He achieved A+ accreditation with the Better Business Bureau, which focuses on advancing marketplace trust, and since becoming a registered US government contractor in 2004 has achieved a credit rating from US business services company Dun & Bradstreet. Every six months he publishes a company 'credentials report' with factual information on personnel, oper-ations, financial and business status. “The charter broker population has exploded over the past 10 years,” says Colson, “with various types of individuals, business models and companies who shape our industry in a variety of ways.” Transparency is at the root of this approach.

Many companies are taking their own steps to lift standards, to ensure they are professional, trustworthy and effective. Some are not. BACA's motto 'Our Word, Our Bond', coupled with a set of industry best practices enables it to set out a blueprint of how to run a professional charter brokerage.

By joining forces with ARGUS, it can now accredit and audit standards, but the challenges it faces remain. How to highlight to aircraft operators that they should be prioritising working with BACA accredited brokers? And the need to continuously raise the standards of the accreditation, setting the bar high for charter excellence. Mumford advises: “The BACA Council is firmly committed to making the accreditation process mandatory for new members which will mean an increasing number of BACA members are ARGUS rated.”

Getting a slice of the HNWI pie

In 2015 there were approximately 14 million HNWIs worldwide, and 2,100 billionaires. The USA is home to the highest concentration of wealthy individuals, China comes second and the UK dominates in Europe. Altogether the emerging markets of China, India, Russia and the Gulf States have recorded the highest levels of growth, but collectively Asia-Pacific has overtaken North America as the number one wealth market. Japan and China have seen nearly 60 per cent of global NHWI population growth.

That's a large customer base. Human connections are really important to this sector so it is important to staff well. Brokers need to be likeable, know-ledgeable, motivated, and professional. Despite the lack of formal educational courses many firms have created an induction pathway to bring up the standard of those working for them, and this is complemented by the introduction of corporate certification.