The majority of people see airports as a transportation venue, like a train or bus station, but for commercial planes. What we don’t tend to think about is that airports are actually businesses looking to make money. There are big business fat cats behind the scenes constantly look at different ways in which they can make their airports profitable.
So, how do they do it? This is what we will concern ourselves with in the following article. We want to show you how most airports make their money. Why? Because it’s actually extremely interesting as not a lot of people think about this topic at all. But, it's mostly to see what we can learn from their business model. Are there any tips and tricks we can take and apply to our own businesses or use to create different business ideas?
Without further ado, let’s take flight and dive right into the points below:
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A huge portion of airport revenue comes from parking. When you think about it, this doesn’t come as much of a surprise. The money they rake in from long-stay parking is absurd. Furthermore, airports are known to charge unbelievably high parking rates. How do they do this and manage to get away with it?
For starters, a lot of people opt for airport over private parking purely because of the location. Other businesses can learn from this and set up their own parking garages close to their premises and charge people to park there. A lot of people will pay purely because they like the fact they can park really close.
Secondly, they try and make their parking seem more desirable and worth the money compared to private ones by making it more secure and safe. Many airports use parking systems as seen here http://www.parkassist.com to add an extra layer of security. With a parking system, they can monitor all the spaces and have lots of eyes on the cars at all times to ensure none get broken into or stolen. People are wary about car security and are willing to pay extra for the added safety. Again, apply this to your business and make your parking area as safe and secure as can be.
In general, parking revenue is something your business should be aware of. People need to park their cars, it’s the perfect way to gain some additional money on the side.
Another clever way airports make money is by renting out retail space on their premises. These days, you have airports that are full of various retail shops. Some airports are almost like shopping centers they have so many shops and food chains in them. As well as providing travelers with things to do as they wait for flights, this also gives airports another source of income. They rent out retail units, and big companies pay them for space. If you think about how many units are in most airports, it adds up to a lot of money!
They make lots of money as companies know airports are a desirable place to situate one of their stores. Why? Because there is more foot traffic in an airport than there is in some shopping centers! People are in there every day, airports are rarely ever quiet, particularly ones in busy cities.
We can learn a lot from this, as renting out retail space is a great way to make money. You can see here http://smallbusiness.chron.com that there are many ways you can earn revenue just by owning a commercial property. So, that’s a small business idea in itself right there for you. Learn from airports and buy a big commercial property then rent out the units inside. Alternatively, if you have your own business, you can still take something away from this. Instead of renting an office or retail unit, buy a building. Then, your business can situate itself in one of the offices/retail units, and you can offer the other up for rent. So, it can be a secondary source of income for an existing business as well as a primary source for someone wanting to start a business revolving around commercial properties.
In conclusion, we can take a lot away from the airport business model. These are the two main ways they make money away from the aeronautical side of things. We can apply them to our own business ideas and start making more money today.