Airport commercial stakeholders stand ready to develop ‘tailor-made responses’ in the pandemic recovery phase should opportunities arise to consult with policymakers, suggests a newly released ACI World white paper.
The Duty Free World Council (DFWC) has applauded the launch today (31 May) of the complimentary publication, titled ‘Regulatory Threats and Opportunities in Airport Retail’, which outlines how airports can adjust their non-aeronautical (commercial) business strategies.
Many airports and retail operators sustained record revenue losses in 2021 and 2022 but the white paper argues that as passenger numbers revive, governments and decision makers have the opportunity ‘to create an enabling environment’ for airport DF&TR.
DFWC President Sarah Branquinho commented: “The pandemic has demonstrated the critical role of duty free and travel retail revenues to the broader aviation and travel industries.
“The cooperation between airports and concessionaires in working together to navigate the difficulties leaves all parties in a stronger position to face future challenges and to embrace the opportunities that we all now have as passengers return to airports and the airport retail experience.”
‘INDUSTRY AT A CROSSROADS’
The white paper identifies some of the major legislative and regulatory challenges* and opportunities** facing airport retail and duty free.
It is designed to assist airport operators, travel retailers and policymakers to collaborate in driving sales, investment and sustainable employment opportunities.
The white paper warns that decisions made by governments and policymakers at this time can on the one hand decrease competitiveness, or on the other set a path towards creating sustainable, community-serving businesses.
“Many airports and travel retail operators are now at crossroads following widespread economic slowdown because of the Covid-19 pandemic and other macro-economic factors,” read the paper.
“Imposing domestic labelling requirements and restricting sales on certain categories of products may reduce competitiveness and inhibit profitability. On the other hand, arrivals duty free and home delivery are examples of opportunities that can be explored across the world.
“Airport operators, travel retail operators, and policymakers should work together to examine potential opportunities, which can help stimulate an increase in sales, investment, and sustainable job creation.”
As the latest edition to ACI World’s Non-Aeronautical Revenues and Activities (ANARA) guidance series launched earlier this year, the white paper has been developed by ACI World’s ANARA Sub-Committee.
The sub-committee is linked to the ACI World Economics Standing Committee, which comprises experts from member airports and world business partners such as WHSmith, Ferrovial Airports, Heinemann Asia Pacific and Kansai Airports.
The sub-committee’s aim is to investigate, analyse, and formulate strategies, policy recommendations, industry positions, and guidance material on how best to improve, facilitate, and diversify the range of non-aeronautical revenue sources to benefit the air transport ecosystem.
DFWC has welcomed the creation of the ANARA sub-committee and the deepening links between ACI and the DFWC, which the association says is demonstrative of the interdependence of both industries.
ACI World Director General Luis Felipe de Oliveira added: “We encourage relevant aviation stakeholders, including governments, to leverage the new guidance and the entire series, to stay one step ahead of the game as they strengthen the commercial side of the business.
“The guidance can in turn also help airports and retailers enhance customer experience and service quality.”
Future publications in the ANARA series will include guidance on digital transformation, F&B and sustainability.
For more information on the white paper, click here…
*Covid-linked healthy, safety & security measures; tobacco illicit trade protocol; labelling requirements; reduction of inbound allowances; tax free abolition in the UK.
**Increasing inbound duty free allowances, home delivery, arrivals duty free, downtown travel retail, domestic travel retail (Hainan, Jeju, Kinmen, Penghu etc).