Anna Krivonosova: “Planes are meant to soar in the sky, not idle on the ground”

Market Daily Staff on January 31, 2024

By: Yar Abrasau

President of the American company SETEC AERO shares insights on reducing aircraft parts delivery time from days to mere hours.

In 2023, global air transport volumes reached 99% of the levels seen in November 2019. The International Air Transport Association reports a 26.4% increase in global flights and a 34.8% rise in domestic ones annually. Aircraft On Ground (AOG) scenarios, where planes are grounded due to technical issues, pose significant financial challenges for airlines engaged in fierce competition. These involve repair costs and result in disrupted schedules, passenger compensations, and cargo delays, impacting the company’s reputation. Anna Krivonosova, an expert in the aviation parts market, believes that effective warehouse management and logistics are crucial to minimizing AOG’s negative impact. At SETEC AERO, founded in the USA in 2021, she has implemented innovative solutions that drastically cut down the time aircraft spend grounded by accelerating spare parts delivery. In her interview, Anna discusses how airlines can save time and money and get planes back in the air faster.

Anna, you’re one of the few women globally to helm the complex business of aviation parts supply. Moreover, you successfully started your own company in the USA. How did you gain experience in this field?

My background is in management and finance, but I’ve always been fascinated by the magic of the sky. Since 2016, I’ve worked in various aviation-related companies, and in 2018, I launched my own aviation parts supply business in Lithuania. Through hands-on experience, I learned how crucial it is to quickly get planes back in the air. I worked with Yakutia Airlines in 2019-2020 to develop a case for repairing and creating a unique aircraft parts warehouse. This significantly improved the company’s parts supply and fleet maintenance, revitalizing several long-grounded aircraft. For Komiaviatrans, I devised a solution to restore and maintain the airworthiness of four Embraer aircraft. My innovations and study of the Russian Superjet-100’s repair cases from 2016-2021 have helped numerous airlines with this aircraft type reduce maintenance time and costs, resulting in tangible financial outcomes.

What, in your opinion, are the main reasons for aircraft groundings due to technical issues?

An airline only makes money when its planes are in the air. Every turnaround minute at the airport is a financial loss. Planes are meant to soar in the sky, not idle on the ground. Often, it’s about replacing a specific part, and the faster it’s delivered, the less the airline loses. The primary issue is the excess links in logistics. There are numerous minor communication delays, where information passes from one manager to another, from a technician to an engineer, to a procurement manager, and so on. As a result, delivery can be delayed by hours or even days. Furthermore, valuable time is lost sending inquiries to various suppliers, typically involving 30–50 addresses. Information gathering, price receiving, and order processing also consume time.

You’ve developed unique logistical solutions that eliminate unnecessary links in the supply chain and offered a comprehensive approach, setting you apart from competitors. Could you elaborate on these innovations?

– Our company has moved away from the traditional approach we just discussed. When every minute counts, we have a single contact point for query responses, preventing information from bouncing around company departments. Our centralized approach saves critical time. Our AOG team operates 24/7. Additionally, we offer package solutions. Our experts thoroughly analyze our clients’ fleets, creating and updating lists of potential vulnerabilities. These lists consider aircraft types, age, destinations, planned maintenance, flight hours, and cycles between repairs, among other factors. When an AOG situation arises, our team knows exactly where to source the part and which expediter to contact for the fastest delivery. This is where we’ve carved our niche in the industry.

You’ve also developed an aircraft maintenance program that includes warehouse optimization, which has become highly sought after. What makes it so appealing?

The service has indeed become very popular among clients. We develop a maintenance schedule and program informing them what and when to service or overhaul. Essentially, this is no longer their concern – they must follow the timelines. But we go further: along with the schedule and program, we optimize their inventories according to the outlined program. For instance, we identify parts with limited shelf life that shouldn’t sit in storage for long or those not needed in the coming months – they shouldn’t occupy space. Not every client has their warehouse, so we optimize incoming parts supplies to arrive precisely when maintenance is scheduled, not earlier to avoid occupying rented spaces, and not later to avoid delaying work. Overall, this service helps clients save resources, time, and money, which is its essential appeal.

SETEC AERO has been in the market for three years but already boasts over 250 suppliers and partners, and you’ve opened a European branch. What’s next?

Our French branch, opened in 2023, partnered with the major aerospace manufacturer THALES. I’m negotiating similar agreements with AIRBUS, AIR FRANCE-KLM, and other market leaders.

The European air transport market is shaking due to rising energy prices, potentially grounding planes. How do you see the situation evolving?

Indeed, European aviation is facing difficulties due to soaring energy prices. Smaller companies might go bankrupt, shutting down entirely or relocating to the US or other countries with more affordable prices. We’ve already started developing several models and solutions to offer our partners, including a unique CRM product that could revolutionize the industry, making aviation parts supplies as convenient, transparent, and optimized as possible

Published by: Martin De Juan

How to Break Free of “Money Shackles” and Achieve Financial Liberation

Market Daily Staff on January 31, 2024

Image Commercially Licensed from: DepositPhotos

Imagine that you’re independently wealthy. How would you live your life? Would you travel, spend more time with your family, or focus on your hobbies? Whatever your dreams might be, Dutch Mendenhall, author of the book “Money Shackles: The Breakout Guide to Alternative Investing” and founder of RADD Companies, wants to help you make them come true.

“The wealthiest people in the world have a system and process that they follow to maintain and build their wealth,” Mendenhall explains. “They’ve figured out how to minimize taxes even while maximizing returns, but they also understand how to have their money work for them. They don’t spend their whole life working to make more money.”

Thanks to Mendenhall, the secrets of the wealthy are now broadly available to everyone, regardless of their personal background or circumstances.

Breaking free from drudgery

Mendenhall named his book “Money Shackles” because most people are raised in a way that keeps them imprisoned in a mindset of drudgery. “In average middle-class families, parents don’t teach their kids much about making money,” he says. “They just hammer the message into your head that you need to work hard, but ironically, when they start making money, many people don’t know what to do with it. So, they do things that keep them dependent on the system, and they have to keep working to bring in more money as a result.”

On the other hand, Mendenhall provides a way out. “It’s about decoding the system so people can break free,” he says.

Part of the secret is not allowing your lifestyle to become more expensive as your salary increases. “If you can keep your costs down, you have more money to invest,” Mendenhall explains. “The more you can invest, the more you can hope for in return.”

In this way, converting discretionary income into capital enables people to garnish reliable returns. “Invest enough, and one day, a magic moment comes when you get more income through these revenue streams than from your employer,” Mendenhall explains. “When that happens, you’ve obtained financial freedom. You don’t need to work anymore.”

Yet Mendenhall doesn’t necessarily advise pumping all your money into Wall Street.

The advantages of alternative investments

“Almost everyone just goes to Wall Street on autopilot,” Mendenhall says, “but that’s not necessarily the most advantageous decision.”

Mendenhall encourages investors to diversify their portfolios by including alternative investments. “I know what you’re thinking,” he says. “You think you can’t become a venture capitalist or angel investor because you aren’t already a gazillionaire, but the truth is you can, through something called fractionalized ownership.”

Fractionalized ownership is crowdfunding for investments. While individual investors might not have enough capital to make a lucrative deal all by themselves when they join groups of other investors, the whole game changes. Indeed, that was the intention behind the US Congress’s decision to create Real Estate Investment Trusts (REITs) in 1960.

Making money work for you with REITs

“Not everybody can buy a $3 million mansion on the beach, right?” Mendenhall says. “But get a group of a hundred or a thousand people together, and they have enough purchasing power to own real estate collectively. By joining forces, they can make the same compounded returns the wealthy make.”

REITs open up real-estate investments for ordinary people who don’t have the resources, time, or inclination to amass and manage their own real-estate empire. By buying into a REIT, you can automatically own a small share of that group’s portfolio. These usually include a range of assets, from warehouses and self-storage facilities to apartments, hotels, and assisted living centers. The REIT’s expert managers are responsible for making purchasing decisions and overseeing the properties, leveraging each to maximize returns. As a result, shareholders don’t take on burdensome obligations even while they can take a share of the profits.

While investing in REITs does incur risk, statistics show these securities have a long history of paying off. According to The Motley Fool, “REITs have outperformed stocks on 20-to-50-year horizons as well as in the latest full year of data (2021). Most REITs are less volatile than the S&P 500, with some only half as volatile as the market at large.”

The Wall Street Journal has identified several reasons why REITs perform so well:

“The most immediately obvious [factor] is the difference in the fees charged by REITs and private funds. Another, almost as evident, is the quick liquidity of REITs. A third is the lower leverage that REITs typically employ — they’re far less debt-driven than are most private equity real estate funds.”

Alternative investments mean more opportunities than ever

Don’t spend your life wearing Money Shackles. Liberate yourself from the grind through investing. Alternative investments, fractionalized ownership, and REITs make it possible.

“The American Dream has changed,” Mendenhall says. “It might not be your grandparents’ American Dream, but there’s more opportunity than ever thanks to these innovative approaches, and they are available to anyone willing to educate themselves about how to make money.”

Published By: Aize Perez