Lagardère Travel Retail has indicated an interest in concession bid opportunities across Africa – including potentially in South Africa – as its trading activities ramp up on the continent.
It also has a presence in the likes of Gabon and Tanzania.
Speaking to TRBusiness in an exclusive video interview, Dag Rasmussen, Chairman and CEO, Lagardère Travel Retail, said: “We continue our business development. Obviously, if there are tenders in South Africa, we will look at this as well.
“Africa for me has great potential. We started with Dakar, investing in great stores with no compromise on quality or assortment with Relay, a duty free store, and an artisan crafts store.”
Strong feedback received on the ranging and a nod towards unique items from Senegal is due in large part to Lagardère teams that are responsible for managing local merchandise.
“This is good as it makes our stores more appealing and helps local communities,” said Rasmussen. “That is something we insist on. This has helped us grow in Gabon, Mauritania, Tanzania and Gambia – and hopefully soon in other countries which I hope we’ll be able to announce soon.”
As reported, the company is forging ahead with openings across Senegal’s motorway and rail network.
As part of broad sweeping conversation covering different geographies, channels and business verticals, Rasmussen spoke frankly about the benefits of possessing a balanced portfolio spanning Duty Free & Fashion, Travel Essentials and Foodservice.
“We’ve really continued the growth trajectory and have invested even during Covid, which I think was a very good idea given what we see now,” commented Rasmussen.
Improvements, but risks endure
He noted encouraging performances over the summer, as travel confidence bounces back following a torrid few years for the industry.
“Everything is in place to have a great fourth quarter; obviously there are some geopolitical risks, inflation… but the fundamentals are there for a great 2023 but with a lot of uncertainty,” he continued. “We have to work with this uncertainty and be very agile and flexible.”
Asked directly about the knock-on effect to Lagardère Travel Retail’s operations as a result of disruption witnessed across airports in recent months, Rasmussen responded: “In terms of disruption, things have improved. It was so difficult to get staff and when we did, we had to retrain them. That was true for us as a retailer but also for the airports as operators.”
However, supply chains remain under pressure, notes Rasmussen, from transportation to costs associated with raw materials and energy prices.
“Inflation is very strong and will probably go on for a while,” he acknowledged. “This is something we have to mitigate with selling prices across all levels of competition, be it local markets, airports and e-commerce to be able to position ourselves with a real value proposition and, much more frequently than before, adjust our prices to remain credible and relevant to our customers.”
This is important, given retailers have and in some instances continue to suffer from low inventory rates and stockouts.
“Despite this, we’ve managed excellent sales,” Rasmussen maintains. “The fact we have three business lines allows us to cope with all kinds of passengers. Travel essentials offers more competitive prices than food or duty free.
“It has the capacity to draw more traffic. Within these stores, we create bundles to make products more affordable globally and have promotions to make the business more attractive. When we see the success we’ve had in 2022 with all these issues, it can only make us positive for 2023.”
As reported, Lagardère Travel Retail notched €1,688 million/$1,772 million in revenue in the six months ending 30 June – up +97.2% on a like-for-like basis (+103.2% reported).
Click above for the full video interview and watch out for the TRBusiness November/December e-zine for further coverage on Lagardére Travel Retail.