SINGAPORE. Changi Airport Group (CAG) announced today that it will launch an open tender for its duty free liquor & tobacco concession on 4 June 2019.
The news comes as an unexpected development after the announcement last December that CAG had agreed two-year extensions for the duty free liquor & tobacco and beauty concessions with incumbents DFS Venture Singapore and Shilla Travel Retail, respectively. Both extensions were due to kick in from April 2020 when the current contracts expire. Shilla’s contract is unaffected by today’s announcement. DFS is an ultra long-term incumbent, having held the contract since 1980.
CAG said, “DFS Venture Singapore (Pte.) Limited (DFS) is the current operator of the L&T concession at Changi Airport. It has decided not to proceed with the two-year extension of its concession that was previously announced in December 2018. However, both CAG and DFS have agreed to extend by two-months DFS’ current tenancy, which will now end on 8 June 2020.”
The tenancy terms will cover 18 stores, spanning over 8,000sq m of retail space across Changi Airport’s four terminals, for a period of six years from 9 June 2020 to 8 June 2026.
CAG said that it is seeking a strong partner with retail concepts to augment the passenger experience for the liquor & tobacco concession. “From store design and product range, to in-store activations and e-commerce strategy, the retailer should put forth a robust and compelling proposal, leveraging new technologies and innovations, to elevate travel retail at Changi,” the airport operator said.
The concession will serve more than 66 million international travellers who pass through Changi Airport annually. “It presents a unique opportunity to work with an award-winning airport retail manager, recognised for its strong support for partners,” said CAG.
CAG Executive Vice President for Commercial Ms Lim Peck Hoon said: “We are excited to hear from the market and look forward to new retail concepts to bring the liquor & tobacco concession to new heights.
“Changi is fully committed in growing with our concession partners through impactful innovation and effective collaboration. There will be a wealth of opportunities for the liquor & tobacco partner to showcase its offerings to Changi’s global audience, delivering revolutionary best-in-class retail experiences, to build and grow its business.”
Interested retailers will be required to attend a compulsory tender briefing and site visit scheduled on 25 June 2019. The deadline for submissions is 5 August 2019.
“DFS’ decision was based on our assessment that our investment plans for Changi Airport required a longer period to fully realise their impact. DFS instead intends to bid in the new concession tender, which is for a period of six years from 9 June 2020 to 8 June 2026,” said DFS Group Chairman and Chief Executive Officer Ed Brennan.
“DFS’ liquor and tobacco operations are recognised by customers, brand partners and industry peers as being among the very best in travel retail. We will continue to operate at Changi under the current concession until June 2020 and look forward to many more years of serving our travelling customers in Singapore.”
DFS noted that its luxury concession operations at Changi Airport; downtown operations at T Galleria by DFS, Singapore; and Singapore Cruise Center business are all separate businesses from the Changi Airport liquor and tobacco concession and are unaffected by the new bid process.
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