As India?s second-largest duty free operator after the India Tourism Development Corporation (ITDC), Flemingo International Ltd regards the Indian Government?s airports privatisation programme as a major business opportunity, according to Mahendra Thakar, Flemingo joint Managing
Flemingo currently operates 25 duty free shops in 12 airports across India. At Delhi Airport Flemingo operates four shops and this is the company?s single largest duty free operation accounting for about 45% of its total airport and sea port tax free sales in India.
Duty free sales at Chennai airport are the second largest, followed by sales at Amritsar airport in Punjab state, which is served by direct low cost international flights carrying returning overseas resident Indians.
At present international attention is focussed largely on the recently privatised Delhi and Mumbai international airports, where the new owners are expected to announce their retail development plans shortly. Flemingo is looking to at least maintain and possibly expand its retail operations in Delhi airport.
The company is also keen to open shops in Mumbai airport as well ? the only major Indian airport where Flemingo currently does not already have a presence.
In an interview with The Business Thakar said: ‘It?s too early to say what shape our future operations will take. We still have another three years to go on our Delhi airport contract. Different airport duty free licenses are for different periods. Not all licences are the same.’
Discussions have already have been held with a number of potential foreign partners over the establishment of a joint venture company to develop and operate duty free shops in Indian airports, but Thakar declined to reveal names. But he did say that Flemingo has already reached advanced stage discussions with one potential partner.
‘We are open to ideas. We are in business. Why not a foreign partner if you have a good partner?’ Thakar said, ‘Our strength is that we have a complete logistic supply chain, good reputation and good PR.
‘For an outsider these are not easy. For anyone teaming up with us it will be an advantage. No one can find a better partner than us. Leading operators are in discussion with us, but we will not sleep with everyone and anyone. We will see which partner suits us. We are open and flexible. We are not desperate.
‘We are at an advanced stage of discussions with one operator to cover all outlets in India. A global operator will benefit from us. We are not big globally comparatively speaking, but sometimes being small is an advantage. If a global operator gets into bed with the wrong partner they can be in trouble. We do not need to sell ourselves. Our success tells the story. We are open to include African operations. Everything has a price tag.’
The Flemingo Group recorded duty free sales in India and Africa of more than $50m in 2005 according to Thakar, who remarked: ‘This year we are looking for 20% growth. India is 45% of our total business. Kenya is another strong market.’
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