Selling a lot of fuel is the most efficient way for an FBO to go broke while feeling successful. It is the great sedative of general aviation. When an owner walks into the office and sees the whiteboard scrawled with a volume that beats last year’s March by 14%, they feel a visceral sense of victory.

They see the trucks moving. They hear the turbine whine. They assume that volume translates directly to value, but in the current market, volume is often a mask for a decaying margin that nobody has the courage-or the data-to unmask.

A gallon of retail Jet-A sold to a transient Global 6000 at full list price is a different species of financial animal than a gallon of contract fuel pumped into a based fleet operator’s Citation at a price point negotiated during the Obama administration. One builds a business; the other merely occupies the fuel farm.

The Archaeology of the Fuel Report

Marcy Okafor, who has managed this office for nineteen years and remembers the tail numbers of aircraft that were scrapped before the current line crew was born, prints the fuel report for the third time this morning. The thermal printer spit out a long, curling tongue of paper that she has weighted down with a brass propeller paperweight.

The buyer’s due diligence team, a group of polite but relentless analysts who look like they’ve never stood downwind of a kerosene exhaust, wants the data split by customer type. The point-of-sale system, a legacy software package that the owner refuses to update because “it still turns on,” cannot perform this split.

Marcy sits with a stack of highlighters. She traces the lineage of every transaction from the previous month. Yellow is for the fleet-card sales where the margin is thinner than a sheet of vellum. Pink is for the based tenants who have a handshake discount with the owner. Green is for the transient retail sales-the “white whales” that actually pay the light bill.

As she works, the squeak of the highlighter against the paper is the only sound in the room. The owner stands in the doorway. He leans against the frame. He has his “World’s Best Pilot” mug in hand. He asks if this manual labor is really necessary. He thinks the total volume on the whiteboard should be enough to satisfy any reasonable person. He is wrong.

The TDS of General Aviation

As a water sommelier, I spend my life explaining that transparency is a poor proxy for content. You can look at a glass of purified municipal water and a glass of high-mineral spring water from the Valser valley; to the uninitiated, they are identical. They are both clear. They both wet the tongue.

An FBO’s fuel volume is the same. It looks like a clear, uniform liquid on a spreadsheet, but the “dissolved solids” of the margin are what determine whether the business is a high-value spring or a common tap.

Historically, this lack of precision is baked into the very term “Fixed Base Operator.” When the Air Commerce Act of 1926 began to regulate the “tramp flyers” who hopped from cow pasture to cow pasture, the pilots who settled down and built hangars became “fixed.” They were neighbors. They were friends. If a local flight school was struggling, the FBO owner gave them a break on the fuel price. It wasn’t a strategic pricing decision; it was a neighborly gesture.

The Forever Discount

The problem is that these neighborly gestures have a half-life of forever. In 1994, a line manager might have given a three-cent discount to a local charter outfit because the pilot brought in doughnuts every Friday. Fast forward thirty years: the pilot is retired, the charter outfit has been sold twice, but the discount remains, calcified in the billing system like a mineral deposit in a pipe.

Nobody at the FBO can say what a gallon of contract Jet-A actually earns because they have never been forced to look at the “spread” in isolation. They look at the “total fuel flowage” and use it as a blunt instrument to beat back the anxiety of rising insurance premiums and crumbling apron asphalt.

Valuation as Archaeology

When a buyer enters the room, the first thing they do is strip away the “neighborhood” and look at the economics. They know that an FBO with 1.2 million gallons of annual volume might be worth significantly less than one with 800,000 gallons, depending entirely on the category of the pour.

If 70% of your volume is contract fuel sold at a 10-cent margin, you are a high-liability trucking company that happens to own a hangar. If 70% of your volume is retail transient, you are a premium service business.

The pricing decisions made informally inside the FBO, never written down and never measured, are exactly the decisions a buyer must reconstruct before trusting any of the volume. They will look at the leasehold position and the current market evidence. They will ask why the based tenant discount hasn’t been adjusted for inflation since the mid-aughts.

The Spice Rack Principle

I recently alphabetized my spice rack-anise to za’atar-and it gave me a profound sense of peace. I knew where the cumin was. I knew the saffron was running low. There is a specific kind of dignity in knowing exactly what you have.

Most FBO owners live in a state of spicy chaos. They have “Volume” on a shelf, but they don’t know if it’s salt or sugar until a buyer tastes it and makes a face. This is where the valuation process becomes an act of archaeology. To truly understand what a business is worth, you have to dig through the layers of “we’ve always done it this way.”

A sophisticated buyer will not apply a blanket EBITDA multiple to a pile of undifferentiated gallons. They will peel back the highlighter marks. This analytical rigor is exactly why a firm like

Griffin Towers

approaches valuation by treating each revenue line as its own economic island.

They don’t just see a fuel farm; they see a complex ecosystem of margins. They reconcile the volume against transaction evidence from the real world, not the “whiteboard world.” They identify the points where a buyer is going to push back, such as that thirty-year-old doughnut discount that is currently eating 4% of the EBITDA.

Dialogue from the Threshold

“The gallons are up. We’re moving more product than ever.”

– The Owner

“We’re moving it. But I’m not sure we’re keeping any of it.”

– Marcy Okafor

It is a devastating distinction. In the world of M&A, “moving it” is a logistics problem. “Keeping it” is a value proposition. When you manage by what is easy to measure-the total gallon count-you lose sight of what is hard to protect. You lose the ability to defend your price because you don’t actually know your cost.

The North Star of Data

The deeper meaning here is that businesses measure what is easy and then manage by what they measure. If the whiteboard is the only thing that gets updated daily, then the whiteboard becomes the North Star. But if the North Star is leading you toward a high-volume, low-margin cliff, you’d be better off navigating by the highlighter marks on Marcy’s desk.

Before you enter a sale process, you have to be the one to find the “dissolved solids” in your own water. You have to be the one to ask why the contract fuel is priced the way it is. If you wait for the buyer to do it, they will use those findings as a hammer to beat down your multiple.

They will point to the handshake deals and the stagnant discounts as “operational risks.” They will treat your lack of data as a lack of discipline. The value you built quietly over decades-the relationships, the safety record, the prime location-becomes a buyer’s guess when the numbers don’t speak for themselves. You have to give them a voice. You have to turn the whiteboard into a ledger.

Success in the FBO world is often measured by the size of the fuel farm, but true wealth is measured by the thickness of the margin. Don’t let the noise of the fuel trucks drown out the silence of the spreadsheet. If you can’t say what a gallon earns, you aren’t running a business; you’re just hosting a very expensive party for people who are passing through.