Lagardère TR ‘open’ to future CDFG business partnerships

By Luke Barras-hill |

LagardereCDF

Artist’s impression showing the CDF-Lagardère T1 East Hall North liquor store.

Lagardère Travel Retail CEO and Chairman Dag Rasmussen has acknowledged that further business ‘possibilities’ with China Duty Free Group (CDFG) could be on the cards after both parties’ success in securing the much-vaunted L&T contract at Hong Kong International Airport (HKIA) earlier this year.

During an exclusive interview with TRBusiness held during last week’s TFWA World Exhibition & Conference, Rasmussen confirmed that the company would be interested in exploring future joint venture partnerships with regards to contract bids moving forward.

“What we brought immediately (to Hong Kong) was the capacity to win the contract; we would not have gone alone and would not have been confident had we gone alone,” he said.

“In that bid, we complemented each other – they know the Chinese customer and retail in China and we have the international expertise for products and how international passengers including Chinese and others have to be dealt with.

“We built something unique and I think the airport appreciated that – it was a unique offer and the best of two worlds. As we are both satisfied with what we are building I definitely hope this will be used again for other contracts. We hope this will create other possibilities and we are working on other possibilities.”

AFRICA: ‘HUGE POTENTIAL’

In a telling admission, Rasmussen says the firm’s Auckland duty free business, where it operates one of two duty free concessions in a joint operator set-up (the other retailer being ARI), has been a ‘big disappointment’.

He admitted that the opportunity to express the brands has not worked ‘as well as expected’ in a competing retail set-up, which he says is detrimental to the consumer.

Elsewhere in Africa, where Lagardère Travel Retail recently secured a 10-year contract at Senegal, Blaise Diagne International Airport (set to open in December) to operate a 1,000sq m duty free store alongside a 100sq m Relay convenience unit, the message is more positive.

“When you enter into Africa you have to have a long term strategy, but we really believe in it,” said Rasmussen.

“We staff our Dakar operations with the opportunity of growing further in the region in all segments – duty free, fashion, travel essentials and in foodservice.

“The fact that some airports are built and managed by international companies, who will want to bring international operators, everyone is convinced it has huge potential tomorrow.”

AELIA ‘NEXT GENERATION’ IN THE US?

In response to a question from TRBusiness regarding the possibility of transplanting the successful next generation Aelia Duty Free concept to the US, Rasmussen says that it has ‘definitely’ been a consideration, however, he makes clear that this is not a priority in the short term.

“What is critical for us is to be successful in the integration. When that integration is done – and it mostly has been done – then we plan to continue growth depending on the best opportunities, with or without Aelia tax free (at locations in the US).”

He also speaks about challenges associated with the Abu Dhabi contract as a result of the continued operating delays.

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