Blue Jay Aviation Case

To begin, BlueJay Aviation appears to be a very promising start-up aviation business. The two owners Wren and Brad seem to have a decent background in financial accounting, but do not possess all of the knowledge required to make strategic business decisions. The purpose of this business letter is to aid them in their decision making process, thus making BlueJay Aviation more profitable. In response to episode six, it would appear that obtaining the gift shop could be profitable. From 2008 to 2010, the previous owners incurred losses for each year, however the losses lessened as the business matured. Without any further information, one could estimate that the business will either make a profit or at least break even in the year 2011, which wouldn’t be a bad investment for BlueJay. My concern lies with the direction of the company; it does not seem likely that a gift shop would line up with the scope of operations for a company that both fly’s banners and conducts aerial
I highly recommend that the company make the following changes to its current payment policy. The first change would be offering a 5% discount to all customers who paid in advance, this incentive would increase the amount of early payments at a minimal cost to the company. The second change I would make would be to allow customers to make a payment on a service up to 20 days after the service was performed. Any payments received 21 – 30 days after the service was rendered would incur a 15% late fee on the amount already owed. All payments received 30 days after services were rendered would incur a 30% late fee, and said customer would no longer be able to do business with BlueJay aviation. These new rules may seem strict, but they encourage responsible customer behavior as well as ensure that BlueJay aviation will receive payments in a timely