AUSTRALIA. Melbourne Airport has today confirmed the award of the duty free licence at the airport’s international terminal to Lotte Duty Free, first revealed by The Moodie Davitt Report on 20 January.
The award follows what the Victorian airport company called “a highly competitive tender process”.
Lotte will commence the contract in the middle of the year, delivering the duty free experience across the international terminal’s 3,600sq m space.
Melbourne Airport Chief of Commercial Property and Retail Andrew Gardiner said that this is an exciting new partnership. “This is the first time we have changed duty free operators in 30 years, and we’re thrilled to have selected Lotte Duty Free,” he said.
“We were privileged to receive submissions from six of the largest and most well-respected duty free retailers in the world. The quality of submissions showed their exceptionally high standards, but, ultimately, there can only be one winner, with Lotte offering a new store which mirrors the look and feel of Melbourne, with a sense of place that placed their proposal on the ‘top shelf’.
“Clearly, having been closed for almost two years due to COVID, financials were an important attribute, but just as important is the ability to offer our customers a thrilling shopping experience, through exciting duty free exclusives, competitive pricing and excellent customer service.
“Lotte convinced us of their ability to deliver against all the major criteria that we set in the bid process.
“I would like to thank Pedro Castro, Philippe Boyer and the Dufry team for the wonderful partnership that has endured over 30 years. I look forward to working with Steve Timms and the Lotte Oceania team to totally transform the duty free experience at Melbourne Airport.
“We are excited about the next 6 months, with the transition to Lotte to occur on 31 May 2023.
“With international travel back to above 70 per cent of pre-Covid levels, now is a great time to be in the international terminal at Melbourne Airport, exploring the incredible range of brands we have across multiple product categories.”
Lotte Duty Free CEO Ju Nam Kim said: “Lotte Duty Free Melbourne Airport store will be a focal point for further overseas expansion and recovery. With successful operation of the store, Lotte Duty Free will step up to be a leading travel retailer in the Oceania region.”
Lotte Duty Free Oceania CEO Steve Timms said: “Lotte is thrilled to be selected to partner with Melbourne Airport. Together we will bring a new level of excitement to the duty-free experience both in store and online by delivering the world’s most unique and interactive retail experiences.”
From our earlier report
Lotte Duty Free’s success will be a huge boost for the company’s ambitious international expansion agenda.
As reported, 11 Expressions of Interest were received for the duty free concession, which was later reduced to seven candidates, then six and finally a shortlist of three.
Australia’s second-busiest airport offered the opportunity to deliver an “exceptional” duty free experience across the international terminal’s existing 3,600sq m duty free space plus an online ecommerce platform.
The award boosts Lotte Duty Free’s presence in Australia, the company having entered the market when it acquired JR/Duty Free at the end of 2018. As a result of that acquisition, Lotte Duty Free also runs the Brisbane Airport duty free concession, currently the subject of a Request for Proposals.
Other duty free operations include Darwin International Airport and downtown stores in Melbourne and (recently opened) Sydney.
The timing of the new contract looks increasingly positive. International traveller numbers at Melbourne Airport climbed to their highest level in December for almost three years amid the first festive period with restriction-free travel since 2019. The 766,439 international travellers served in the month was almost 120,000 more than in November and represents 71% of the number recorded in December 2019.
Including domestic, 2,635,925 passengers passed through Melbourne Airport in December, which is 79% of the 3,332,940 passengers processed in December 2019. ✈
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