First of all I don't agree with what is going on and I believe that this is a practise praying on the young, naive, greedy (people want that £70k CPL(H) prize!) and vulnerable.
I guess it's a bit like music companies making CDs for pennies and selling for pounds.
How much do items of highstreet fashion cost to make? How much are they sold for?
What about the national lottery?!?
Years ago I used to fly around the boss of GHD Hair Straighteners - he made millions - why? Because he imported the product, boxed, ready to go on the shelf from China for £12 (inc tax & duty) and they sold to women who happily pay £100+ for a set!
If you want to make a lot of money you have to sell to a lot of people.
£290 for a 10minute flight that forms part of a 3 hour experience? Yes it seems a tad steep but you're never going to get an hour in an R44 from somebody who is looking to make a profit as well - It's circa £120 an hour just for fuel (and Wolverhampton's fuel ain't the cheapest in the UK).
My mate just sold his R44 Raven II and did some sums recently. Because Frank has insisted on so many mandatory things above and beyond the original maintenance schedule in years gone by it has cost more to run than expected. In fact it's cost him over £600 an hour (wet).
So in his aircraft a 10minute flight would be £100 for the aircraft alone.
Lets add an Instructor, premises, website, admin staff, landing fees, hangarage, advertising, telephone, stationary, annual business costs...
Then there is the all important profit!
(from
Small Business - Chron.com)
Retail Clothing Industry Profit Margins
The retail clothing industry had an average gross profit margin of 48.46 percent in 2009 according to Butler Consultants. However, by the time you add up all the expenses involved in operating retail clothing stores, the average net profit margin is only 7.98 percent. If your expenses are typical, then around 7 to 12 percent net profit would be a reasonable goal.
Equipment Manufacturing Industry Profit Margins
Butler Consultants lists the gross profit margin of the equipment manufacturing industry as 31.98 percent in 2009. The net profit margin only works out to 6.81 percent, largely due to the significant capital expenses in this industry. Unless your expenses are much less than your competitors, you want to aim for at least 6 percent and perhaps up to 9 or 10 percent net profit for your equipment manufacturing business.
Telecommunications Industry Profit Margins
Gross profit margins averaged 86.51 percent for the telecommunications industry in 2010. While that seems like a healthy profit margin, overhead is very high in the telecommunications industry and the average net profit margin is only 10.99 percent. Assuming industry-average expenses, a reasonable profit margin would be anything between 10 and 15 percent.
Retail Electronics Industry Profit Margins
The average gross profit margin in the retail electronics industry come in on the mid to low side at 30.76 percent, but like all retail businesses, labor expenses are relatively high and the average net profit in the industry is only 4.68 percent. A net profit in the range of 5 to 8 percent would be reasonable for a retail electronics store.
Economy of Scale
Another important factor in determining a reasonable profit is the economy of scale of the business. A huge business like Walmart, for example, can afford a net profit of just a few percent on most items because of the volume of sales, but a local florist with a small sales volume needs to make profit margin several times that just to pay her bills and make a decent profit.
Great Business Model.
If it's too good to be true IT GENERALLY IS.
Highly unethical IMO (I won't pretend to have a humble one).
Lets hope some of these people actually DO get their CPL(H) whether that's through Senior Aviation or by working hard, saving, scrimping, paying bit by bit or raiding daddy's piggy bank.