Israeli travel retailer Layam has won the tender for a 100sq m souvenir shop at Tel Aviv Ben Gurion International Airport Terminal 3 as it seeks to grow at home and abroad.
The contract is for six years with the option to extend for a further two and includes a 136sq m warehouse located next to the store. The agreement begins on 1 November 2019 ahead of a three-week renovation and the incumbent is the Steimatzky chain.
Revenue during the contract period is expected to amount to ILS160m ($46m).
Established in 1936, 12 years before the state of Israel was created, Layam runs a 450sq m toy shop and 100sq m kids fashion shop in Tel Aviv Ben Gurion Terminal 3. It also operates a 70sq m toy shop in Terminal 1.
Outside the airport, Layam runs a diplomatic duty free shop in Tel Aviv and liquor and tobacco and perfume and cosmetics shops in the passenger terminals at Ashdod and Haifa seaports.
A member of the International Ship Supplier Association, the company, which is fully controlled by the Teddy Sagi Group is active in all Israeli ports with logistic/commercial facilities and warehouses in Haifa and Ashdod.
TRBusiness first revealed in April that the company was enjoying strong sales performance at Tel Aviv Ben Gurion and looking to expand through mergers and acquisitions.
Shay Tangi, Layam CEO told TRBusiness: “We are very excited to win this tender and seeking new opportunities all the time even outside Israel. Negotiations are taking place with a couple of duty free companies with a view to doing business.”
He added: “We are fulfilling our growth strategy and when this tender opportunity came up we went for it full throttle and won.”
Currently operating souvenir sections at its seaport duty free stores in Ashdod and Haifa, this should stand Layam in good stead when the new store opens later this year. Tangi said: “A section of our duty free stores in Haifa and Ashdod are dedicated to souvenirs so we are familiar with this product segment.”
The location of the store in Terminal 3, which serves the majority of passengers arriving and departing Israel is certainly conducive to strong sales. “This shop is dedicated only to souvenirs and located in the heart of the airport, where the number of visitors is very high.”
Tangi, who reiterates the need to renovate the existing store to improve the customer experience, says new lines of inventory will be added to the mix. “We will definitely change some of the suppliers and keep some of the old items which were sold by the previous operator. It is going to be an evolution not a revolution.”
He also emphasises the importance of the souvenir segment in an airport such as Tel Aviv Ben Gurion. “Israel is a Jewish state, but very important for people of other religions such as Christianity.
“Jerusalem and Nazareth are places people come to visit and the souvenir offer is mostly dedicated to those who want to take something home with them to share with their loved ones and remind them of the experience.
“Most products in the existing store relate to Israel and Judaism and there are various items produced by craftsmen and young artists who sell their items exclusively in-store.”
The Layam kids and toy stores in Terminal 3 and Terminal 1, along with the seaport duty free and diplomatic shops are all performing strongly, according to Tangi. “The toy shops are exceeding expectations and the kids fashion store is also doing okay. We will definitely improve on last year’s sales. Overall, business is extremely positive.”
He concluded: “The most important thing is that we keep seeking new opportunities outside Israel. We are looking to win new tenders or buy small or medium-sized duty free companies. We are very dedicated.”