Cracking the Airport Market, Part 2

The summer traveling season is in high gear, and on-airport rental operators are profiting from the patronage of customers who put a high premium on convenience. Savvy travelers deplane with a rental reservation made online, and their cars are ready for pickup just paces from the arrival gate.

Are you interested in getting in on this action? Part one of this series detailed some of the ins and outs of the airport rental market and the challenges and hurdles it presents to smaller operators.

Attempting to establish or move operations on airport — particularly at a mid- or large-sized airport — is not for the faint of heart. However, it is possible. Depending on the market you are in and what you are willing to invest, it might be the logical next step to growing your rent-a-car business.

We spoke to three operators at different stages of doing business on airport. One is just getting onto a new consolidated rental facility, another has been on the airport for about a year and is enjoying success, and the last operator sold his airport franchise. Their experiences and recommendations may help you determine if this is the right business venture for you.

Ramping Up for Anchorage Airport
Dennis Lavey sold his independent car rental business in Anchorage, Alaska, years back, and then bought it back three years ago after it had become a U-Save franchise. The Lavey family owns one location next door to Ted Stevens Anchorage International Airport and another in downtown Anchorage.

“We’ve had some discussions about expanding it to the airport, and that’s our big thing; we feel we need to be on the airport,” says Lavey, who is now a partner in the business. His son, Mitch, runs the operation. Moving onto the airport seems to be part of a natural progression in the operation’s growth.

At press time, they were negotiating to secure a spot in the new consolidated rental facility being built at the airport, but have yet to submit an official application. The process of getting into the facilThe facility, scheduled to open July 18, process of getting into it is not as complicated as other airports. The airport has eight openings and seven companies at present to fill those slots. No bidding was necessary.

But the challenge for the Laveys will be growing their operation’s volume to a level where it can absorb the airport’s minimum wage guarantee and high costs of being a part of the new rental car facility. They are strategizing how best to do that in order to move forward.

“If you want to be on airport you have to do a lot of cars,” Lavey says. “Typically we run about 100 cars, and I think the minimum we would have to run is 300 on the airport because the fees are very high.”

CONTINUED:  Cracking the Airport Market, Part 2
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