Hidden Revenue Potential at Airports

Whether traveling for business or leisure, many of us have experienced firsthand the increase in the number of air travelers. Although fully booked flights are encouraging news for the industry, they also mean higher operating costs for the individual airports. To help defer these costs and become self-sustaining, many airport managers have begun to explore creative revenue generation opportunities.

A study conducted in 2017 by Airports Council International (ACI) estimated that the airports total cost per passenger is approximately $13.69. This value however exceeds the global average of $9.95 for aeronautical revenue received per passenger. While aeronautical revenue per passenger seems to be constant, the airport has the potential to increase revenue by finding creative ways to increase the non-aeronautical revenue associated with each passenger.

Revenue generated by an airport is typically divided into two streams. Aeronautical revenues include those funds generated to the operation and use of the airfield by aircraft or aviation-related businesses. Non-aeronautical revenues relate to those operations and uses that are incidental to the operation of aircraft. Traditional sources of non-aeronautical revenue include parking, rental cars, terminal lease, concessions, restaurants, and advertising. According to ACI, 39.9% of total global airport revenue is contributed from non-aeronautical revenue sources. Successful airport managers understand not only the aviation-related operations of their airport, but also the revenue potential associated with non-aviation operations and business. Some non-aeronautical revenue strategies that are applicable to both commercial service and general aviation airports include:

non aeronautical strategies

As technology advances, additional non-aeronautical revenue sources may also rise and airport administrators must be willing to embrace these opportunities to help defer ever-increasing operating costs and become self-sustaining.

For further questions about these creative approaches please contact me.

About Patrick Sharrow

Patrick is an Airport Planner, active private pilot as well as a licensed Part 107 commercial sUAS pilot with Hoyle Tanner. He is an Accredited Airport Executive with the American Association of Airport Executives, has a Master of Business Administration in Organizational Leadership through Norwich University and a degree in Aerospace Studies with concentrations on Airport Management, Aeronautical Science, and Human Factors from Embry-Riddle Aeronautical University. Patrick specializes in airport management, airport planning and development, project management, emergency preparedness, and aviation security. Away from aviation-related activities, Patrick enjoys camping with his lab whippet mix, Piper Cherokee. In northern Vermont, you can find him fly fishing with his hand tied flies using rods he builds himself, along with swimming, snowboarding, and skiing. He also enjoys collecting and restoring antique tractors and engines with his father.