Should Your Business Own Business Jets?

If you travel a lot for business, you may have considered a private jet. You won’t have to deal with the airport security, the delays, the difficult other passengers, or trying to get to the one place on earth no airline seems to fly directly to. A private jet gives you luxury, time and the certainty that, short of weather or other emergencies, you’ll be where you say you’ll be, when you say you’ll be there.

At this point you’re probably thinking, “But man, private jets are expensive! I bet that would cost a million dollars!” Good news. You may be able to buy a fractional ownership (think timeshare) in a private jet, or use a private jet charter service. If you buy a fractional ownership, you could own 50 hours a year in a small jet for less than $100,000.

That is, admittedly, still a lot of money. Is this a smart move for your business? It is if you travel a lot, lose time and productivity flying, and need to be able to get to business destinations quickly and without hassle.

“But that’s still a lot of money!” Yes, it is, and one way to figure out whether you should do this is to look at the costs for flying. Assume you fly business class, twice a month, and spend $1,000 on your flight each month. That’s $24,000. Still short of the price of a fractional jet ownership.

But also assume that you have to lose eight hours of work for each flight, getting to the airport, changing planes, going through security at each airport, and all that. If your salary is $100,000 per year, you’re losing $400 in work time each time you fly. That adds up to $9600 per year, so we’re still under $25k, for flying business class.

But now you need to ask yourself—could you improve your business by $75,0000 per year if you could save time, work on the plane, and arrive at business meetings rested, refreshed and ready to work? Could you save money on hotels if you could fly when and where you need to?

A lot of the value in your jet ownership is in the intangibles, and those things can add up to significant value for your business. In deciding whether your business should own a jet, consider that you can buy a fractional ownership for one year, and if it works out, you can increase the fraction or continue with what you’re doing. If it doesn’t work out, you can let it go.

In other words, if you have the money, why not give it a try?