Matchmaker, matchmaker, make me a match — if you’re old enough to recall, this is one of the famous show tunes from the musical, “Fiddler on the Roof.” I may or may not have participated in the production during high school… But be that as it may, I do find myself as a matchmaker today.
February is the month of love and, of course, Valentine’s Day. “Matchmaker, matchmaker, make me a match” as the song goes — well, we see the Pilatus market challenged in the matchmaking process. Sellers’ expectations don’t match the buyers’.
One-third of our yearly business consists of playing ‘matchmaker.’ It is a very time-consuming process and, at times, can weigh on everyone’s patience. However, it is also the most rewarding aspect of our business. There’s something about diving deep into a client’s mindset to unpack their perfect PC-12 that is extremely rewarding. Once we’ve done this, the fun really begins. Now we must play matchmaker and educate our clients by providing enough background and useful information for them to find their match.
The matchmaker challenge in today’s Pilatus market is exemplified by the disconnect between asking prices and market prices. Several sellers are still demanding pricing and terms indicative of a market that existed 18 months ago. For example: there are 88 PC-12s and PC-24s on the market today and 39 of these being available for over 120 days. 27 of these aircraft have not had price adjustments! This is exactly what we are talking about. Recently we were working on a matchmaker project whereby pricing on a ‘shortlist’ aircraft had been quoted 30 days ago at one number, and then when we called back to verify pricing recently, the asking price had gone up and was set at “firm” by the seller. Another great example of this phenomenon is the amount of market adjustment pricing. So, how many aircraft have been on the market for a considerable time, but have gone through significant pricing changes? The answer: 12 of the 39 aircraft (having spent over 120 days on the market) averaged a 7% reduction in price. Just two months ago we acquired an aircraft for a client for around the $4 million mark. This aircraft was on the market for 365 days and had originally started pricing at $5,500,000!
Look… when you break it all down, we are simply managing expectations and communications for our clients. Our ability to play matchmaker is only as good as our ability to match up these communications and expectations. Sure, the raw data surrounding a specific aircraft does somewhat speak for itself. But what your spreadsheet cannot tell you is the mentality of a seller and their specific expectation for the outcome.
We may have mentioned our Pilatus Value Ranking (PVR) system in the past. In a nutshell, this takes all the intangibles and tells our clients what the best value is on the market (think, best ‘match’). However, we recently pointed out to some clients that, although the system has been tested against the market over the past few years and has been graded 99% accurate, our system cannot tell you what your best ‘match’ is. It cannot provide the mental status of a seller’s/buyer’s expectations and it cannot predict or comprehend their specific expectations. This is why being a matchmaker is so challenging and rewarding. We tap into another level of intelligence to bridge this gap between sellers and buyers, and what the answers look like on paper.
We would love to show you how our matchmaker abilities can work for you. Give us a call or shoot us a note.
Fly safe,
Bub