By Roger Field
Commercial airports are becoming an important centre for retailers of FMCG products.
With a large captive audience and a predictable flow of customers, it is little surprise that airports have become a force to be reckoned with in the Middle East’s retail sector. Some 75% of Dubai International Airport’s revenues are generated from retail revenues, compared to just 25% from aviation. And while Dubai’s airport may be the UAE’s biggest transport hub, Sharjah International Airport duty free is also keen to take its share of commercial business.
Eugene Barry, general manager of Sharjah Airport duty free, said that retail sales, including FMCG products, have been increasing rapidly in the past year.
“Sales of fragrances, cosmetics, and skincare are experiencing big growth in Sharjah, and this category is one of our key drivers,” he told Retail News Middle East. “Month on month, fragrances, confectionery, and other FMCG goods are experiencing significant double-digit growth over the last year. These categories are experiencing consistent growth over last year, more than electronics for example.”
Sales increased by 37% from January to June 2006 compared with the same period in 2005. This can be attributed mainly to a rise in the number of people using the airport, and a change in the passenger profile, which is now more diverse in terms of nationalities and spending power, according to Barry. He added that this change is due to Air Arabia’s efforts to equate low-cost travel with high-quality service on its expanding route network.
To tap this growing consumer base, Sharjah Airport duty free has invested in duty-free staff training during 2006, improving customer service. “We have a strong commercial focus on our business so we are constantly introducing new product concepts and promotional activity to exceed passengers’ expectations when they transit through Sharjah Airport,” Barry said.
“We have the backing and support of the Dufry corporation, which operates over 380 shops globally. We also have a very good relationship with the Airport Authority and have a partnership approach with them.”
Barry added that while each region faces different challenges and opportunities, the duty-free industry in the Middle East looks set to remain buoyant. “Dufry Sharjah duty free is well positioned to meet current opportunities. Airports in this region have a much stronger commercial outlook than they may have had in the past, so you will see more diverse retail and food and beverage outlets at airports, both airside and landside.