Gift vouchers for TIF's are usually sold as an hour of flight time rather than a dollar value. If they don't expire and some chap waits 5 years to use it, it will likely cost to company more than what was paid to make the flight. Given they have waited so long to use it there is not a high likelihood they will return for further training anyway.
In the instance that started this thread we wouldn't enforce the expiration date that strictly.
this is a prime opportunity for any flying school in the same area to offer to honour the certificate and at least partially redeem the industry.
Flying-spike where do you work?? I want to come get $300 worth for free if that's how you operate.
Assuming for a minute that a school makes $100 profit per hour of flight training, that's $4000 profit per PPL that goes through to completion.
I would be surprised if many flying schools are making profits like that, I know we certainly aren't!
Precisely the reason why I used the word revenue rather than profit.
Aware the profits are not necessarily huge, however assumedly there are still numerous fixed overheads that can only be covered by additional cash flow, and the best way to achieve that is to not turn away potential customers
Back in the mid 70's the Whittlesea Flying School conducted a promotion at Northland Shopping Centre giving away TIF type gift vouchers with a purchase within the centre. Their aim was to increase club membership and train more pilots.
Two mates and I, all keen and opportunistic Air Training Corp cadets, purchased enough of the needed product, probably model aircraft from Toyworld, to be rewarded with several TIF vouchers.
When we approached the flying school with the number of vouchers we had they were taken aback a little but never once tried to wiggle out of their committment.
The three of us enjoyed a tour of Port Philip Bay and the area around Whittlesea with landings at a couple of airfields for us to swap seats and take turns up front. The flight was well over two hours and was sensational and inspirational.
Unfortunately for the flying school none of us did any flying training with them, due to other opportunities and career paths back then. Whilst the flying school did not gain any benefit from our endeavours, they engendered a large degree of respect from us and a hell of a lot of enthusiasm for flying. All three of us have enjoyed long careers in the aviation industry.
Whenever I hear about TIF gift vouchers I wonder why a flying club would take the risk for the odd chance of gaining a member or student.
I understand that many schools particularly in the GA world don't charge for the instructor on a TIF and conducting tif's is highly competitive because if you snare the student, you get them for the entire PPL journey.
if you snare the student, you get them for the entire PPL journey.
Interesting point - it is precisely because
...many schools particularly in the GA world don't charge for the instructor on a TIF...
...that the job always gets thrown to a Grade 3, possibly the person in the school least equipped to ensure a great experience and do an effective soft-sell.
As a young fella I know I scared off more than one prospective student
Over the years at least two of those have come to my school (without recognising me as the callow yoof I once was), had a great TIF, and said "Last time I flew was in 199x at [school]...it was awful - that guy was a ********!"
Ouch. I had a wonderful TIF (which I paid for) and immediately signed up for lessons.
Time passes and third attempt made to schedule said TIF. Response from school, "uh sorry, that certificate has now expired, however we're happy to take more of your money and try again"
If a company has an expiry date policy, it should be clearly marked on the voucher and explained to the customer. Surely the average school isn't selling five hundred of these a day? There should be enough time to explain the house policy. Legalities aside, that's just good customer service.
I was involved with a non aviation business that regularly offered discount and gift vouchers; the terms were clearly printed on the voucher and our staff made every customer aware of them. We never had any complaints.
The two clubs i have been around who offer any kind of trail flight certs usually work pretty hard to make sure they have the staff to honour the date. They are relistic with their bookings, actually check the long range forecast and even if the punter shows up in the middle of a busy training they will give them priority (not many punters understand for every hour in the air you spend at least 2-3 waiting on the ground! drinking instant coffee), i have seen a punter turned away for a senic in the marlborough sounds on a nice sunny day, because the wind out there would have meant a right kicking, they could have gone but probably would have confirmed for all pax that light aircraft a dangerous death traps that should be avoided at all costs
I have also had 1 or 2 gift certs that people have bought me for my birthday (luv u mum), ok not trial flights but still a cert with an expiry date. A cert expired... (found it in the back of the log book) ok i'm not a walk in, and i'm a regular flying member... but the club happliy extended the cert to THAT flight.
I know there are some shifty operations out there but its not all of em!
HL, you did not read my post very well it seems. I suggested it is not difficult to put a Dollar value on a gift voucher which means that it will only ever be worth the initial value. Increased costs will not be a problem for the issuer. The morality of selling Gift Certificates with expiry dates, especially in the expectation that many will not be redeemed, seems questionable to me. As for encouraging prospective pilot trainees I think most people would only buy such a T.I.F. Voucher for someone they thought would use it.
The morality of selling Gift Certificates with expiry dates, especially in the expectation that many will not be redeemed, seems questionable to me.
As long as the agreement is clear, I don't see a problem.
From a book keeping point of view, the profit is entered as it is paid, and the liability the voucher represents is entered as a debt to the business to balance it (otherwise you would overstate your profit for that year). That liability needs to be removed from the books eventually - otherwise over ten years or so you would pile up thousands in unused vouchers on the debit side of the register! To put an expiry date on the voucher allows you to rule out the liability after a reasonable time period.
HL, I am a Club Member and part of the Board. To me, it matters not what my association is with the "business" I simply do not believe that a "Gift Certificate" should be sold with an expiry date, provided it is for a Dollar value. If it were simply for a 1 hour flight, or a T.I.F., that is a different matter and I would have no issue there. Notwithstanding, the question in the original post of this thread would indicate that the Club concerned initially caused the delay in use of the voucher and therefore had a duty to honour it when requested at a later date.
From what you say you believe that if I owned the business I would think differently. As for every Gift Voucher for every retail outlet having an expiry date, that is incorrect. I recently came upon a Bunnings Gift Card given to me for Christmas 2010. It had no expiry date, nor should it have in my opinion, and it was accepted without question within the last week.
Exactly Old Fella. I buy gift cards as presents and walk away without buying if it has an expiry date. If the bean counters don't want to keep the liability on the books the solution is simple - refund the money - they should be happy with that, after all, the interest on the funds is all profit.
"Flying-spike where do you work?? I want to come get $300 worth for free if that's how you operate." I get paid for advice so here is your $300 worth:
Some things you do in business give you no immediate, tangible return apart from enhancement of the business's reputation and, in doing so lead to future custom (at a profit) that would otherwise not have occurred. This is because the recipient of the free service or product see the provider as a fair trader and worthy of their trust and business. This is called "Good Will" and is even measured and quantified when assessing the assets of a business. It isn't a new practice in aviation either, "barnstormers" of old used to give away the odd free ride to make the most of the "free" advertising when the recipient returned to earth and spread the word amongst the crowd.
Last edited by flying-spike; 1st Jul 2012 at 22:47.