This table of top tourist arrivals by nationality helps explain the attraction of the Bali duty free tender

INDONESIA. Airport company Angkasa Pura 1 has awarded its core duty free concession agreement at Ngurah Rai Airport – Bali’s new International Terminal, to Dufry International. Dufry will also operate some duty paid stores.

In related news, Angkasa Pura I also signed five-year concession agreements on 2 May with three food & beverage operators – Bogajaya, Sumber Mas Utama and Taurus Gemilang – to operate at Ngurah Rai International.

Dufry beat off strong competition from a high-class international field for the five-year concession. A separate award for five speciality packages will be announced in coming days (we’ll also bring you further results of the F&B tenders later).

Based on the new contract, Dufry will operate seven shops covering a total retail area of 2,200sq m, offering a duty free assortment that includes perfumes & cosmetics, liquor, tobacco and confectionery & fine food. Dufry will open four shops airside totaling 1,700sq m, including a main walk-through concept of around 1,100sq m. Additionally a whiskey boutique and satellite shops will be offered airside. Dufry will also operate 500sq m of Arrivals shopping, split into three stores.

The duty free agreement was signed in Jakarta on Friday by Angkasa Pura 1 President Director Tommy Soetomo and Dufry Chief Operating Officer Xavier Rossinyol (pictured).

The five-year F&B concessions were also signed a day earlier by Soetomo together with Bogajaya Director Budi Utomo; Sumber Mas Utama Vice Director Rotua M. Gultom, Vice Director; and Taurus Gemilang Director Budi Purnomo.

The airport company promised that the duty free agreement would usher in a “new level in the history of Indonesian airport retail”, adding: “This event is a major milestone in Angkasa Pura I’s transformation journey and its goal to enhance the non-aeronautical revenue contribution.”

As a state-owned enterprise of Indonesia, Angkasa Pura I has the authority to manage 13 airports in Indonesia, including Ngurah Rai International Airport. In December 2012, Angkasa Pura I entered into a strategic collaboration with GVK Airports, owner and operator of Mumbai and Bangalore International airports, India, where a similar transformation has been successfully achieved, the company noted.

From 2013, some of Angkasa Pura I’s aeronautical revenue has been shifted to the new National Air Navigation Service Provider Company, making the growth of non-aeronautical revenues crucial, the company said.

Angkasa Pura 1 President Director Tommy Soetomo and Dufry Chief Operating Officer Xavier Rossinyol celebrate the signing of the duty free concession agreement at Ngurah Rai Airport

“Enhancing service levels to the customers is our main priority,” it commented. “Angkasa Pura I will not only deliver basic services of an airport, but will also create a unique and enjoyable travel experience inside the terminal, especially in the commercial area where most passengers spend their time. Excellent services inside this commercial area can only be delivered through strong partnership with a world-class operator that has a proven track record.

Soetomo said: “The non-aeronautical revenue will make a significant contribution to our overall income and growth. We are happy to see the initiatives implemented jointly with GVK are delivering success within a short period of time. We are also pleased to see that the international tender process has been conducted in accordance with best international practices and Indonesian laws. This has resulted in Dufry International Ltd being selected following the rigorous process”.

We are looking forward to making Bali Airport a flagship in the travel retail worldwide
Julián Díaz
Dufry Group

He said that in line with the company’s vision, the 2013 changes relating to aeronautical revenues had prompted a change of focus to non-aeronautical revenues. “The non-aeronautical revenue growth will replace the aeronautical revenue loss,” he said, noting that the duty free agreement was an important step in the transformation.

Dufry CEO Julián Díaz commented: “We are extremely pleased with this new opportunity to operate at Ngurah Rai International Airport. Bali is a key tourist destination in Southeast Asia and as such fits perfectly with our growth strategy focused on tourist destinations and emerging markets.

“We are convinced that we can create a world-class travel retail space together with our partners and with the airport and we are looking forward to making Bali airport a flagship in the travel retail worldwide. We’ll make sure we deliver the best possible retail experience to the travellers in Bali, providing also a real Sense of Place. Indonesia is one of the most dynamic countries in the region and we’ll commit our best efforts to develop its travel retail.

Soetomo added: “Bali as the “˜Island of Paradise’ and Ngurah Rai International Airport as “˜The Gateway to Paradise’ are aiming to be among the top ten airports in Asia. Through this partnership Angkasa Pura I and Dufry International Ltd believe Ngurah Rai International Airport will deliver high quality brands, excellent customer services and sell value for money travel retail products.”

GVK Vice Chairman GV Sanjay Reddy commented: “The high level of participation by Indonesian and international companies in the international tender process and the outcome demonstrates the success of two major international airports companies collaborating with each other. We will now shift our attention to assisting Angkasa Pura I to enhance the level of service and income not only at Ngurah Rai International Airport but also at their other airports.”

According to Dufry, Ngurah Rai International Airport handled 16 million passengers in 2012 with nternational passengers accounting for over 50%, making the airport Indonesia’s busiest in international passenger terms. Passenger traffic increased by +12% in 2012.