With the current concession due to expire later this year, Beijing Capital International Airport is still working on plans for the airport’s new duty free concession period, which is due to start at the beginning of 2016, according to a source.

 

Beijing Airport’s duty free sales are said to have reached RMB.3.8bn ($630m) through Sunrise Duty Free, which operates duty free shops in Terminals 2 and 3, where 20.7m international passengers (+4.5%) passed through in 2014. [Total departing and arriving passengers at Beijing Airport reached a staggering 86.1m in 2014 – an increase of approximately 2.9% on 2013-Ed].

 

 

 

Cosmetics and perfume was the largest selling category last year, followed by liquor and tobacco and fashion and accessories.

 

Confirming that the current concession period expires this year, a source told TRBusiness that Beijing Capital Airport Commercial & Trading Co signed a contract with Sunrise Duty Free for 10 years to run from 2006 to the end of 2015, covering duty free shops and boutiques in T2 and T3. [The airport company runs its own duty paid shops and boutiques in T1, T2 and T3-Ed].

 

 

STILL WORKING ON DUTY FREE PLANS

With the current duty free concession due to expire later this year, Beijing Capital Airport Holdings is understood to be still working on its plans for the new concession which is due to start at the beginning of 2016.

 

Whether this will result in a further extension to Sunrise Duty Free’s contract, or a new duty free tender is not known at present. If the airport company decides to tender the business then the China Duty Free Group (CDFG) would seem to be the most likely challenger and especially considering that foreign companies are not allowed to tender for airport duty free contracts in China.

 

The China Duty Free Group now operates more than 200 shops in China, including what is generally regarded as the world’s biggest RMB.5bn ($815m) duty free store located in Haitang Bay near Sanya. This boasts a staggering 120,000sq m of floor space and 72sq m of retail floor area.

 

Currently, the largest duty free shopping area at Beijing is in Terminal 3, which handles about 75% of all international passengers and acts as the main international hub for Air China.

 

Beijing Airport appointed Sunrise Duty Free on a 10-year contract to run its Terminal 2 and Terminal 3 shops from 2006 to the end of 2015.

 

Sunrise’s shops in T3 comprise two perfume and cosmetics outlets, plus shops selling duty free liquor and tobacco (and food), a cigar store, two mixed category stores, plus four fashion outlets selling different merchandise and other stores – including 20 luxury boutiques.

 

A similar offer is available in Terminal 2, although there are fewer boutiques due to the smaller space.