How to create a financial forecast for a flight school?

If you are serious about keeping visibility on your future cash flows, then you need to build and maintain a financial forecast for your flight school.
Putting together a flight school financial forecast may sound complex, but don’t worry, with the right tool, it’s easier than it looks, and The Business Plan Shop is here to guide you.
In this practical guide, we'll cover everything you need to know about building financial projections for your flight school.
We will start by looking at why they are key, what information is needed, what a forecast looks like once completed, and what solutions you can use to create yours.
Let's dive in!
Why create and maintain a financial forecast for a flight school?
Creating and maintaining an up-to-date financial forecast is the only way to steer the development of your flight school and ensure that it can be financially viable in the years to come.
A financial plan for a flight school enables you to look at your business in detail - from income to operating costs and investments - to evaluate its expected profitability and future cash flows.
This gives you the visibility needed to plan future investments and expansion with confidence.
And, when your trading environment gets tougher, having an up to date flight school forecast enables you to detect potential upcoming financing shortfalls in advance, enabling you to make adjustments or secure financing before you run out of cash.
It’s also important to remember that your flight school's financial forecast will be essential when looking for financing. You can be 100% certain that banks and investors will ask to see your numbers, so make sure they’re set out accurately and attractively.
Need a convincing business plan?
The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

What information is used as input to build a flight school financial forecast?
A flight school's financial forecast needs to be built on the right foundation: your assumptions.
The data required to create your assumptions will depend on whether you are a new or existing flight school.
If you are creating (or updating) the forecast of an existing flight school, then your main inputs will be historical accounting data and operating metrics, and your team’s view on what to expect for the next three to five years.
If you are building financial projections for a new flight school startup, you will need to rely on market research to form your go-to-market strategy and derive your sales forecast.
For a new venture, you will also need an itemised list of resources needed for the flight school to operate, along with a list of equipment required to launch the venture (more on that below).
Now that you understand what is needed, let’s have a look at what elements will make up your flight school's financial forecast.
The sales forecast for a flight school
From experience, it usually makes sense to start your flight school's financial projection with the revenues forecast.
The inputs used to forecast your sales will include the historical trading data of your flight school (which can be used as a starting point for existing businesses) and the data collected in your market research (which both new ventures and existing businesses need to project their sales forward).
Your flight school's sales forecast can be broken down into two key estimates:
- The average price
- The number of monthly transactions
To assess these variables accurately, you will need to consider the following factors:
- Weather conditions: Weather can heavily affect the number of monthly transactions at your flight school. Poor weather conditions such as heavy rain or snow can lead to cancellations, while sunny and clear weather can attract more students.
- Fuel prices: As a flight school, you rely heavily on fuel for your aircraft. Fluctuations in fuel prices can impact your average price for flight lessons and rentals, which in turn can affect your monthly transactions.
- Competition: The presence of other flight schools in your area can impact your average price and number of transactions. If there are many competitors offering similar services at lower prices, you may need to adjust your prices or offer promotions to remain competitive.
- Pilot shortage: A shortage of pilots in the aviation industry can affect your flight school's average price and number of transactions. As demand for pilots increases, the cost of flight lessons and rentals may also increase, leading to fewer monthly transactions.
- Economic conditions: Economic factors such as a recession or economic downturn can affect your flight school's average price and number of transactions. During tough economic times, people may be less likely to spend money on hobbies and leisure activities such as flying, leading to a decrease in monthly transactions.
Once you have a sales forecast in place, the next step will be to work on your overhead budget. Let’s have a look at that now.
Need a convincing business plan?
The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

The operating expenses for a flight school
The next step is to estimate the expenses needed to run your flight school on a day-to-day basis.
These will vary based on the level of sales expected, and the location and size of your business.
But your flight school's operating expenses should include the following items at a minimum:
- Staff Costs: This includes salaries, benefits, and training for all of the instructors, administrative staff, and maintenance technicians that you will need to operate your flight school.
- Accountancy Fees: You will need to hire an accountant to help you with bookkeeping, tax preparation, and financial planning for your flight school.
- Insurance Costs: As a flight school, you will need to obtain insurance to cover liability, property damage, and any other potential risks associated with operating your business.
- Software Licences: In order to manage your student records, schedule lessons, and track finances, you will need to purchase licenses for flight school management software.
- Banking Fees: You will incur fees for setting up business bank accounts, processing transactions, and maintaining a line of credit for your flight school.
- Aircraft Maintenance: In order to keep your aircraft in safe and operational condition, you will need to budget for regular maintenance, repairs, and inspections.
- Fuel Costs: Fuel is a significant expense for any flight school, as it is necessary for training flights and other operations.
- Rent/Lease: If you do not own your own facility, you will need to budget for rent or lease payments for your flight school location.
- Marketing and Advertising: In order to attract students and promote your flight school, you will need to budget for marketing and advertising expenses, such as website development, print materials, and online ads.
- Utilities: Your flight school will have ongoing expenses for electricity, water, and other utilities needed to operate your facility.
- Office Supplies: In order to manage day-to-day operations, you will need to budget for office supplies such as paper, pens, printer ink, and other supplies.
- Training Materials: As a flight school, you will need to purchase training materials such as textbooks, manuals, and simulator software for your students.
- Landing Fees: Depending on the location of your flight school, you may need to budget for landing fees at local airports for training flights.
- Uniforms: If you require instructors and staff to wear uniforms, you will need to include the cost of purchasing and maintaining them in your operating expenses.
- Professional Memberships: Joining professional organizations and associations related to the aviation industry may provide valuable resources and networking opportunities, but may also come with membership fees.
This list is, of course, not exhaustive, and you'll have to adapt it according to your precise business model and size. A small flight school might not have the same level of expenditure as a larger one, for example.
What investments are needed to start or grow a flight school?
Your flight school financial forecast will also need to include the capital expenditures (aka investments in plain English) and initial working capital items required for the creation or development of your business.
For a flight school, these could include:
- Aircraft: This is the most essential capital expenditure for a flight school. You will need to purchase aircraft for your students to train in, as well as for your instructors to use. Depending on the type of flight school you run, you may need to invest in different types of aircraft, such as single-engine, multi-engine, or even helicopters.
- Flight Simulators: Flight simulators are an important tool for flight schools as they allow students to practice flying in a safe and controlled environment. These simulators can be quite expensive, but they are a necessary investment to ensure the safety and effectiveness of your training program.
- Ground Training Equipment: In addition to flight training, ground training is also an important part of becoming a pilot. This may include purchasing computers, projectors, and other equipment for classroom instruction, as well as training materials such as textbooks and study guides.
- Facilities: Your flight school will need a physical location for students to attend classes, take exams, and store equipment. This may include purchasing or leasing a building, as well as any necessary renovations or upgrades to make the space suitable for a flight school.
- Maintenance and Repair Tools: As a flight school, you will need to have the proper tools and equipment to maintain and repair your aircraft. This may include purchasing specialized tools, as well as investing in training for your maintenance staff.
Again, this list will need to be adjusted according to the size and ambitions of your flight school.
Need a convincing business plan?
The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

The financing plan of your flight school
The next step in the creation of your financial forecast for your flight school is to think about how you might finance your business.
You will have to assess how much capital will come from shareholders (equity) and how much can be secured through banks.
Bank loans will have to be modelled so that you can separate the interest expenses from the repayments of principal, and include all this data in your forecast.
Issuing share capital and obtaining a bank loan are two of the most common ways that entrepreneurs finance their businesses.
What tables compose the financial plan for a flight school?
Now let's have a look at the main output tables of your flight school's financial forecast.
The projected profit & loss statement
The projected profit & loss shows how profitable your flight school is likely to be in the years to come.

For your flight school to be financially viable, your projected P&L should ideally show:
- Sales growing above inflation (the higher the better)
- Profit margins which are stable or expanding (the higher the better)
- A net profit at the end of each financial year (the higher the better)
This is for established flight schools, there is some leniency for startups which will have numbers that will look a bit different than existing businesses.
The projected balance sheet
Your flight school's projected balance sheet provides a snapshot of your business’s financial position at year-end.
It is composed of three types of elements: assets, liabilities and equity:
- Assets: represent what the business possesses including cash, equipment, and accounts receivable (money owed by clients).
- Liabilities: represent funds advanced to the business by lenders and other creditors. They include accounts payable (money owed to suppliers), taxes payable and loans from banks and financial institutions.
- Equity: is the combination of what has been invested by the business owners and the cumulative profits and losses generated by the business to date (which are called retained earnings). Equity is a proxy for the value of the owner's stake in the business.

The cash flow forecast
Your flight school's cash flow forecast shows how much cash your business is expected to consume or generate in the years to come.

It is best practice to organise the cash flow forecast by nature to better explain where cash is used or generated by the flight school:
- Operating cash flow: shows how much cash is generated by the operating activities
- Investing cash flow: shows how much will be invested in capital expenditure to maintain or expand the business
- Financing cash flow: shows if the business is raising new capital or repaying financiers (debt repayment, dividends)
Keeping an eye on (and regularly updating) your flight school's cash flow forecast is key to ensuring that your business has sufficient liquidity to operate normally and to detect financing requirements as early as possible.
If you are trying to raise capital, you will normally be asked to provide a monthly cash flow forecast in your flight school's financial plan - so that banks or investors can assess seasonal variation and ensure your business is appropriately capitalised.
Need a convincing business plan?
The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

Which tool should you use to create your flight school's financial forecast?
Creating your flight school's financial forecast may sound fairly daunting, but the good news is that there are several ways to go about it.
Using online financial forecasting software to build your flight school's projections
The modern and easiest way is to use professional online financial forecasting software such as the one we offer at The Business Plan Shop.
There are several advantages to using specialised software:
- You can easily create your financial forecast by letting the software take care of the financial calculations for you without errors
- You have access to complete financial forecast templates
- You get a complete financial forecast ready to be sent to your bank or investors
- You can easily track your actual financial performance against your financial forecast, and recalibrate your forecast as the year goes by
- You can create scenarios to stress test your forecast's main assumptions
- You can easily update your forecast as time goes by to maintain visibility on future cash flows
- You have a friendly support team on standby to assist you when you are stuck
- It’s cost-efficient and much cheaper than using an accountant or consultant (see below)
If you are interested in this type of solution, you can try our forecasting software for free by signing up here.
Calling in a financial consultant or chartered accountant
Enlisting the help of a consultant or accountant is also a good way to obtain a professional flight school financial forecast.
The downside of this solution is its cost. From experience, obtaining a simple financial forecast over three years (including a balance sheet, income statement, and cash flow statement) is likely to cost a minimum of £700 or $1,000.
The indicative cost above, is for a small business, and a forecast is done as a one-shot exercise. Using a consultant or accountant to track your actuals vs. forecast and to keep your financial projections up to date on a monthly or quarterly basis will cost a lot more.
If you opt for this solution, make sure your accountant has in-depth knowledge of your industry, so that they may challenge your figures and offer insights (as opposed to just taking your assumptions at face value to create the forecast).
Why not use a spreadsheet such as Excel or Google Sheets to build your flight school's financial forecast?
Creating an accurate and error-free flight school financial forecast with a spreadsheet is very technical and requires a deep knowledge of accounting and an understanding of financial modelling.
Very few business owners are financially savvy enough to be able to build a forecast themselves on Excel without making mistakes.
Lenders and investors know this, which is why forecasts created on Excel by the business owner are often frowned upon.
Having numbers one can trust is key when it comes to financial forecasting and to that end using software is much safer.
Using financial forecasting software is also faster than using a spreadsheet, and, with the rise of artificial intelligence, software is also becoming smarter at helping us analyse the numbers to make smarter decisions.
Finally, like everything with spreadsheets, tracking actuals vs. forecasts and keeping your projections up to date as the year progresses is manual, tedious, and error-prone. Whereas financial projection software like The Business Plan Shop is built for this.
Need a convincing business plan?
The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

Use our financial projection templates for inspiration
The Business Plan Shop has dozens of financial forecasting templates available.
Our examples contain both the financial forecast, and a written business plan which presents, in detail, the company, the team, the strategy, and the medium-term objectives.
Whether you are just starting out or already have your own flight school, looking at our template is always a good way to get ideas on how to model financial items and what to write when creating a business plan to secure funding.

Takeaways
- A financial projection shows expected growth, profitability, and cash generation for your business over the next three to five years.
- Tracking actuals vs. forecast and keeping your financial forecast up-to-date is the only way to maintain visibility on future cash flows.
- Using financial forecasting software makes it easy to create and maintain up-to-date projections for your flight school.
You have reached the end of our guide. We hope you now have a better understanding of how to create a financial forecast for a flight school. Don't hesitate to contact our team if you have any questions or want to share your experience building forecasts!
Need a convincing business plan?
The Business Plan Shop makes it easy to create a financial forecast to assess the potential profitability of your projects, and write a business plan that’ll wow investors.

Also on The Business Plan Shop
- Example of financial projections
- How to project revenues for a business?
- Sample financial forecast for business idea
Know someone who runs or wants to start a flight school? Share our financial projection guide with them!