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Retail boom at airport

Airport retailing world over is big with about 60 per cent of the revenues earned through commercial activities at the airport.

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Soon you may be able to watch Swiss chocolate being made while you wait to catch your plane at the Mumbai airport. This is the international prize-winning concept of the Nuance Group AG, a major in retailing industry, which it proposes to bring to the Banglore airport as well. Closer home, retailer Shoppers’ Stop and Nuance Group AG as its venture partner are among the five short-listed bidders for a contract to set up duty-free retail outlets at the Mumbai international airport.

Airport retailing world over is big with about 60 per cent of the revenues earned through commercial activities at the airport. In India this market is right now in a nascent stage with a strong growth potential. Internationally, this is about a $200 million-strong market and the growth can be sustained even if the amount spent by passengers remains the same for next eight years.

Nuance with an annual turnover of $1.7 billion has a presence in 17 countries with 340 shops across 57 airports operating in duty free core categories like cosmetics, liquor, chocolates and specialty stores like the food and beverage outlets. With India’s projected annual passenger growth of 10.4 percent, the group will be coming to India after operating in the Asian markets of Hong Kong and Singapore. The Group operates on concessional contract business model for an average of about four to five years.

“A complete change of the international terminal is in the pipeline with the existing shops to be moved from their current location at the Mumbai airport. The proposed investment would be to the tune of about $3 million. How much you spend per square feet is an important factor for Mumbai airport. We would like to be associated with the project as it would be an investment into the biggest and busiest airport,” said Carlo Bernasconi, executive vice president business development and strategic marketing, Nunance Group AG.

“It is the inward-bound passengers that we are targeting in India,” said Roberto Graziani, CEO of the Nuance Group AG. If the presentations of the retail outlets at the Bangalore airport are anything to go by, the airport at Mumbai would be a swish hub with souvenir shops like Life’Sprirt, fashion stores like La Moda Fashion, Boutique du Chocolat and many other stores with plush lounges.

On the domestic terminal side, the foray of Shoppers’ Stop into airport retailing industry is being seen by B S Nagesh, managing director of this retailing outlet as “an extension of the unique shopping experience to the airports.” The process of bidding for the Mumbai airport is expected to be complete by first week of March with a contract to be signed by March 15. By June 1, the contract will become operational.

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