Budapest Airport (BUD) concession revenue (retail, food and beverage, duty free, currency exchange) has risen 8.5% in 2019.

In conversation with TRBusiness, Patrick Bohl, Head of Retail and Advertising, Budapest Airport said BUD experienced  ‘high’ commercial revenue growth driven by a record 16 million passengers last year. This was off the back of Budapest’s thriving tourism industry, the airport’s expanding flight network and new carriers.

Bohl commented: “A lot of this growth was achieved during peak hours from people rushing through the airport.”

Regarding the terminal extension, which will be located next to the existing Terminal 2, Bohl, who recently outlined the airport’s sustainability strategy in an exclusive interview with TRBusiness said: “At the moment, we are talking to our longstanding duty free incumbent Gebr. Heinemann and other concessionaires about the plan for the next four years until we expand.”

When the new terminal extension eventually opens, it will no doubt offer a strong local flavour and sense of place, much like the existing facility. Bohl said: “This is the main international airport in Budapest and there is a responsibility to showcase great Hungarian products. We are lucky in the sense there are fantastic wines, spirits and foods people not only buy for friends and relatives, but also as souvenirs. They also purchase them because they taste great and receive better deals in duty free than elsewhere.

“Our Memories of Hungary store is located right in the middle of the central terminal building which has such a strong sense of place.”

The launch of new routes and the airport’s strong partnership with LOT Polish Airlines is bringing back some of the transfer traffic. With LOT Polish Airlines, for example, increasing its network from BUD to various European and long-haul destinations such as Chicago and Seoul, the airport is generating growth from a completely new segment.

Such developments will be music to the ears of Gebr. Heinemann, which celebrated 20 years of partnership with Budapest Airport in August 2018. The retailer opened its first 640sq m business unit at the airport in 1998. It now operates around 2,320sq m of retail space in Budapest Airport’s SkyCourt including a central walk-through shop, two boarding gate shops, three specialist fashion stores, a Victoria’s Secret unit and a multi-brand accessories store. “We have a long-standing partnership with Heinemann and there are a few years to run on the existing agreement. We are really happy with how things are going.”

Long-term contracts help breed trust, emphasised Bohl. “If long-term contracts are in place, each partner is happy to invest in the relationship. Over the years, the level of trust also increases. If changes are required along the way you go through them together.”

The collapse of Hungarian national carrier Malev on 3 February 2012, for example, resulted in significant changes and a challenging period for Gebr. Heinemann and Budapest Airport. “We had to close one terminal which included the whole retail environment,” he recalled. “Despite going through some difficult times together, we have come out with extremely successful stores. We have opened a second walkthrough and Heinemann has again invested in the remodelling of the main existing duty free store. This has all been driven by a strong element of trust which has grown over the years.”

Creating trust at consumer level is also important, particularly among Chinese consumers. Since last year, Chinese travellers, for example, have been able to make cashless payments using WeChat, China Union Pay and Alipay. Gebr. Heinemann, Memories of Hungary, Living Toys, Budapest & Music and Swarovski are among the outlets to have adopted these Chinese payment systems. “Overall, we are pushing towards creating a Chinese friendly airport with signage and Chinese speaking hostesses. There is also a non-stop flight to Beijing and flights to Shanghai,” he concluded.