Now is the time to find the right airport retail business model

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JFKIAT (New York Operation Q4) Chairman and CEO Roel Huinink told delegates to the Summit of the Americas that the pandemic has accelerated the need to find the optimal business model for airport concessions.

Terminal 4, which was hit hard at the start of the pandemic, is now experiencing a semblance of recovery with around 50 to 55% of 2019 levels in domestic traffic and 30 to 35% in international traffic.

This is good news for JFKIAT business partners who include SSP, Dufry, Hudson, Paradies Lagardère and DFS Group who maintained operations despite the turbulence.

Huinink spoke about his opinion regarding the future of the airport concession model, in particular the minimum annual guarantee (MAG). Although he said he doesn’t believe in MAG himself, he does believe in the need to inspire retailers to perform. “There is a certain expectation of an airport [for sales per pax]. “He added that the two entities must come together to drive a new customer experience, new concepts and new digitization.

Huinink admitted that JFKIAT’s plans for a $ 3.8 billion retail expansion and modernization project announced in February 2020 have now been filed. The major redevelopment project would have seen a significant expansion of the terminal’s commercial offering, adding 500,000 square feet of space.

However, the ambition of the project remains. “We are going to rethink our global commercial offer because this [pandemic] changed the business. Do we have the right concepts, in the right places?

“I think we need to invest in concepts focused on data and e-commerce and I hope this pandemic will be able to accelerate the pace of implementation. Reaching the consumer earlier in the journey and getting them into the buying mindset is extremely crucial. We need to find the pattern that we haven’t found yet; to grow the cake and not eat the other’s share, ”he said.

Employee confidence, the key to restoring consumer confidence

Huinink told delegates that consumer confidence in travel will be vital in the coming months, and the first step in restoring consumer confidence is to restore employee confidence.

“As essential workers, our employees have been on the front lines of the crisis. At T4, we continued to operate 24/7; our employees play a crucial role in the journey to the airport and we have done everything possible to ensure their safety, ”he said.

Speaking of the start of the pandemic, Huinink said the impact was hard. The first priority was safety and the Schiphol Group affiliate began by focusing on disinfection, contactless and social distancing measures.

Retaining the workforce and talent at JFKIAT has been one of the biggest challenges, said Huinink, who said the number of employees increased from 12,000 to 2,000. He revealed that one part of the management team had also joined the front line, playing a hybrid role to retain skills and knowledge in the company.


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