Part of aviation training is testing. For most FAA pilot certificates or ratings, an FAA knowledge test is required for applicants to be eligible to take the final practical test and become certificated or have a rating added to their already existing certificate. While practical tests are typically administered by FAA designated pilot examiners who will show up at your location, FAA knowledge tests must be taken from an approved provider (an FAA Organization with Designation Authorization - ODA), of which there are currently two, PSI and CATS. Both of these companies have sites throughout the country, and becoming one is something that you may want to consider adding to your business model.
The main benefit of adding a knowledge testing center to your business is the customer service that you are able to provide. When your customers are able to take the tests at the same place they receive training instead of being sent to another location when they need to complete a knowledge test, it offers added convenience for them and perceived value to your business. You will be required to purchase materials for the testing center, primarily copies of FAA knowledge test supplements in paper format for all tests you administer. There is some potential for profit, but don’t expect it to be a major cash cow. Profits from tests provided are shared in a percentage with the ODA and the site depending on the selling price of the test provided.
Setting up a knowledge testing site requires appropriate facilities and staff to manage the operation. In general, facilities are required to have a minimum of three testing stations in a room that is completely closeable (and securable) during any time when a testing applicant is taking a test. The room must be able to be monitored by a test proctor, either in the room or from a location that allows constant supervision—closed circuit TV is acceptable.
Staff is another requirement, and one that can cut into profit margins. A testing center must have a designated testing center supervisor (who must pass a test) and approved proctors (who must have met FAA training requirements and remain current in their certification). These proctors are trained by the testing ODAs who work to ensure that each testing site remains in compliance with FAA testing center operational guidelines. (See more information on the FAA website.)
The good: Providing a testing center can be convenient for your customers. It can keep your customers from ending up at competitive flight training providers who do provide testing. CATS and PSI allow your testing center, once fully set up, to provide other tests beyond FAA testing.
The bad: Staffing a test for three hours is expensive, and if you are only giving one test at a time, you may not be making any money at all for the time that your staff watches someone take a test. For non-FAA tests, pricing may be lower to applicants, and it is very common to have these tests cost you money to give in the end. You have to maintain standard business hours, which means that you have to have qualified staff at these times, so potential walk-in customers could schedule and take a test. In many cases, the staffing side of the equation in providing a knowledge test center is not profitable unless you are giving a significant volume of tests. A big part of the calculation will depend on what you pay the person who will be sitting, monitoring anyone testing hourly, or if you can utilize already existing staff to accomplish this task.
Record keeping is important. You will be audited at least once a year. This means that any staff that is working with the process must be detail oriented to avoid potential errors and problems in audits later.
Becoming a knowledge test center provider may be something your business should consider to enhance services provided or, in some cases, add a profit center. If you believe you can generate the volume of applicants either from your own customer base or as a combination with other training providers nearby, seek more information and carefully consider if adding a knowledge testing center to your business is right for your business.