Cochin Airport Eyes Arrival Duty Free

Cochin International Airport in India is showing a 30% increase in sales revenue over last year with the majority of this coming from non aviation areas.

The passenger count is up 10% for international arriving and departing to 2.6 million showing that customers are spending more on duty free merchandise. In order to enhance future growth the Cochin International Duty Free shops are focusing upon an "online business model". This would allow customers to place their orders online and take delivery of their duty free goods upon arrival at Cochin Airport at the arrivals duty free shop.


The software for this pre-order system is now being implemented and will go live soon.

Carnival Cruise Lines starts new port facility in Dominican Republic

The largest cruise line company in the world, Carnival Corporation, has broken ground on a new port facility in Bay of Maimon, Dominican Republic. The $65 million project near Puerto Plata on the north coast of the island is a joint venture between Carnival and the Rannik family of Grupo B&R.

  

The new port facility will accommodate 8,000 passengers and 2,000 crew per day with two berths for ships. The first year will see 250,000 passengers with duty free shopping facilities in the terminal building. The scheduled opening date is in 2014.

Ireland's Shannon Airport - where does it go from here?

In 1947 the Irish Customs Free Airport Act established Shannon Airport as the world's first duty free facility something which would become a template for other Duty Free facilities worldwide. The sharp rise in the number of transatlantic flights to North America established the airport as the last refueling point between the two land masses but the introduction of long range jet aircraft it soon saw passenger numbers decline.

Ryanair - was a regional hub for the airline?

Being under the control of the government owned Dublin Airport Authority (or Aer Rianta as it was known as then) since 1969 it has always been felt that Shannon Airport was seen as a second class status with it now being Ireland's fifth airport and suffering a 37% decrease in passenger numbers in 2010. Even with the advent of the low cost airlines such as Ryanair the DAA has not been able to cement a steady enough relationship with Ryanair who have taken traffic to other airports in Spain.

However, in a turn around decision this week it has been outlined that Shannon Airport will no longer be under the authority of the DAA - the Government will still own Shannon Airport but the direct control of the airport is being handed over to local management at Shannon Development, the regional development agency.

The Future Options for Shannon Airport

The first priority is to increase passenger numbers now it will be able to compete on a level playing field with the other Irish airports. Also establish niche activities will make it a player in the aviation market - with its long runway and abundance of surrounding land for warehousing, 24 hour flying capability due to its isolated location, US customs clearance (the only one in Europe) it would make a good European hub for cargo. The first development of this kind has already been signed with the US cargo group Lynx building a 19,000 sqm facility for a global airport cargo facility specialising in international logistics services.

The title of the world's first duty free shop will still remain with Shannon as long as they can guarantee their future with growth such as this.

Social Media takes hold of Europe's Airports

In a new report "Digital Report 2012" by ACI Europe it has emerged that Europe's airports are creating a direct link with it's customers through social media, such as Twitter and Facebook, with airports in Central Europe being the most proactive.

The report highlights the fact that over 33% of Europe's airports are developing or have mobile "apps" to give the passenger more live information - this includes corporate communications, crisis communications, customer service, informal customer relationship building, and commercial promotion.

Gatwick Airport has 30,000 Twitter followers

The chief objective of most airports is to make information available so as to make the passenger experience as hassle free as possible.

London Gatwick Airport has recently been honoured with Twitter's "blue tick" of authority with it's 24 / 7 Twitter customer service support. It now has 30,000 Twitter followers plus a website and Facebook site.

In Poland, Warsaw Chopin Airport has over 11,000 Twitter followers sending information out in both polish and English. The tweets are made up on updates on flight information, traveller tips and special offers in the airport duty free shops.

It is expected that social media will take a more proactive role in the future.

Australian Govt are pushing for ban on arrivals tobacco

According to leaked reports in Australia the government there is edging closer to a ban on all arrivals duty free tobacco. It is suggested that that the reasoning behind this ban will lead to increased government revenues through taxation and not for health reasons. An independent analysis by Deloitte Access Economics calculates the net tax gain to be in excess of A$17 million per annum although this does not take into account additional Customs enforcement costs.

This ban would have a deep affect of the Australian duty free industry as Australia's Arrivals Duty Free Shops would be covered by the ban.
 
This, however, has brought a strong response from the Australian Duty Free Association who feel the government have overstated the additional tax revenue it would achieve and not taken into consideration the damage this will cause to the duty free industry and loss of revenue to operators and airports.

There is no date set for the implementation of this ban.

Jericho Duty Free Shop planned

The Palestinian Authority is planning to open a duty-free shop in Jericho as President Mahmoud Abbas has approved the project. The project is subject to the Palestinian Authority cabinet approval but the profits will support the president's fund for students in refugee camps in Lebanon and underprivileged areas.

The duty free shop will be set up at the Palestinian Authority arrivals and departures hall at the Allenby Bridge crossing servicing over 1.7 million people per annum between the West Bank and Jordan. 

Most West Bank residents must travel via the Allenby Bridge to Amman's airport to travel internationally as there is no airport in the West Bank and Israel forbids most Palestinians from using Ben Gurion Airport in Tel Aviv. 

Initially the duty free shop will sell traditional products such as cigarettes, perfume and chocolate and then later electronic goods. 

The Changing Face of Travel Retailing

The Worldwide travel retail business is worth in excess of $30 USD billion and over two thirds of this is down to airport shopping. Nevertheless, as seen in the past it is more sensitive because of its susceptibility to crisis - SARS crisis and 09/11 are just two examples which hit the sector the hardest. The airport operators world wide are becoming more dependent upon the retail revenue as the emergence of budget airline operators suppress their revenues by moving out to new airports offering the best prices for them.

Over the last 10 years it has become a key feature of airports to showcase "walk-through concepts" - passengers are guided from the airport entrance to the airplane departure gate through a frenzy of retail sales activity (e.g. Duty Free Shop), a path of retail temptation. It is found that passengers are at their most relaxed after completing check-in, passport and security checks.

One of the growing trends now is the advent of the Arrivals Duty Free Shop - perfect locations for last second shopping on arrival or for travellers not wishing to carry duty free goods on a long journey. this gives the retailers an opportunity to showcase locally made products. However, the big drawback with arrivals duty free shops is that this entails changes in legislation to allow such an activity to take place - usually a long draw out process. Recent examples of new arrivals duty free can be found in Switzerland and numerous countries in South America.

The whole aim of these latest trends is to convert the "passenger" into a "shopper" - no easy feat since in excess of 70% of passengers do not shop, not really surprising as they are actually there to travel!. However, a well spoken about concept in the airport industry is the phrase "sense of place" in conceptualizing travel retailing. One of the foremost authorities on this is Robbie Gill of The Design Solution company who have designed airports throughout the world. He believes that this "sense of being" should and will play a major part in transforming passengers into shoppers via transforming their travel retail experience. Gill believes that bringing a "local flavour" into the equation will go a long way to achieving this and he cites the examples at Barbados' Grantley Adams International Airport, where the shops all have corrugated roofs reminiscent of chattel homes, and Minneapolis with sculptures of Snoopy and Canada geese in the terrazzo floors. Changi Airport in Singapore has its own very unique 'sense of place' through the remarkable range of gardens such as the Sunflower Garden, Orchid Garden, Cactus Garden and Butterfly Garden.

The Design Solution recently worked on The Irish Whiskey Collection Duty Free retail store at Dublin Airport's new Terminal 2. This is retail with a true 'sense of place', as it only promotes Irish Whiskeys to local and international travellers. The new concept and store design was created solely to boost Irish Whiskey sales within the airport's duty free store, boosting Irish Whiskey sales by over 30%.

It can be demonstrated that 'sense of place' is far more than bricks and mortar; it is of the locale, the commerce and the culture. It shows a more interesting passenger experience, and in today's tough operating climate where travellers have more choice of where to fly from than ever before, that cannot be underestimated.

The "Perfect Seat" on a flight

A recent passenger survey conducted by the flight comparison website, Skyscanner, asked 1,000 airlines passengers about their seating preference on board an aircraft. They were given the option of an aisle, window or middle row seat.

And the result from a standard plane....seat 6A.

This finding backs up similar surveys carried out in the past which suggest the popularity of the first six rows due reduced engine noise, quicker exit from the plane on arrival and better selection of food and duty free trolley. The preference though would be for an aisle or window seat as only 1% of those questioned said they would opt for a middle seat.

Some airlines are now preparing to charge people for booking seats and with this data available EasyJet airline plans to charge £8.00 for this sector in the plane and £3.00 elsewhere.
 

First six rows are the preference

And the least popular seat... 31E (middle seat at the back). Presumably this is due to lack of choice on the duty free trolley! 

Men forced to sacrifice luggage space

In a recent survey of 2,000 travellers by London Stansted Airport over 52% of the male claimed that when journeying with their female partner some of her belongings were in fact in his suitcase. The research shows that on average the male "sacrifices" 5Kg over to the partner.

While 25% of questioned passengers spend over 3 hours packing for a journey it transpires that 13% leave their house without crucial documents (passport, boarding card). Despite the lengthy time packing 37% of women passengers admitted to "re-arranging" the contents of their luggage at the airline check-in and over half stating they take too much luggage on holiday. The survey did also take into account hand luggage but not duty free purchase hand luggage.

The Future of UK aviation in the hands of Politicians

 

British Government Aviation Minister, Theresa Villiers, has re-iterated the government stance of a third runway at Heathrow stating it would have a "massive" impact on nearby resident's quality of life with the increase effect of over 220,000 more over London per year. 

Instead, "another solution" to south east England airport capacity was needed, Mrs Villiers said at a transport conference in London in April 2012. She acknowledge that Heathrow was near capacity as is and Gatwick fast approaching this.

However, this goes against evidence produced by Colin Matthews, CEO of BAA which owns Heathrow airport who argues that foreign airlines are moving away from the idea of the airport due to aircraft capacity constraints. This would have the effect of the UK losing out to rival European airports if Heathrow is not expanded. 

The Board of Airline Representatives in the UK (BAR UK) which produced the poll shows that 53% of scheduled airlines have either decided to, or are preparing to, base flights in other countries than the UK because of Heathrow's lack of capacity and 86% of airlines said they would put on more flights to the UK if additional take-off and landing slots were available at Heathrow.

The message is clear - no capacity at Heathrow then the airlines will move out of Britain - thus handing any economic growth to European competitors. Needless to say there would be no travel retail, duty free growth either which is critical revenue for the airport owners.
   

Britain - A World Class Destination

 

Foreign visitors to Great Britain last year spent a record £17.7bn, a figure that confirms Britain's place as a top world-class destination.

According to VisitBritain, the number of tourists coming to the UK for holiday purposes was also a record at just under 12 million. In 2011, 3.57 million visits were by North American residents - a five per cent increase on the figure for 2010.

"As we look back on a positive 2011 for both holiday visits and spending, we want to make sure we capitalise on these gains by helping boost jobs across the country and create a lasting tourism legacy for many years to come,” said Patricia Yates, strategy and communications director at VisitBritain.

'We are encouraged that...the number of visitors coming to Britain from North America has risen. This is significant as we earn very nearly twice as much from US visitors than we do from any other source market,' she added.

Bumper tourist year expected for Britain with Jubilee and Olympic Games

Britain’s rich history and heritage continue to be strong drivers in attracting visitors. Famous buildings and monuments, castles and stately homes, and churches / cathedrals are all well regarded and interest is reflected in visit numbers. Britain is seen as a world-class destination in terms of its built heritage.

Castles hosting live concerts, museums holding fashion shows, or river boat rides on the Thames are especially exciting for potential tourists.

For a traveler whether shopping online or visiting the top travel destinations throughout the great cities of the world such as London, you will find duty free shopping. If you want to know anything about arrivals duty free, or duty free shops on ferry boats, cruise ships, frontier crossing border stores and tax-free refund shopping, search your destination first.

Spanish Airports Authority to put Duty Free Shops out to tender.

The Spanish Airports Authority (AENA Aeropuertos SA) are set to announce the tender to manage the countrywide duty free shops in the country. AENA is the public body which owns the majority of the airports (with the exception of two privately owned airports) and also controls the air traffic control body. Aena is the world's largest airport operator with 47 airports and two heliports in Spain (carrying 193 million passengers in 2010) and participation in airports in Mexico, the USA, Cuba, Colombia, Bolivia, Sweden and the UK.

The current operator Aldeasa, part of the Autogrill owned World Duty Free Group, has had a three year extension to the current contract which expires on 31 December 2012. The new contract is expected to increase revenues in duty free and will attract some of the big names in the duty free world - Dufry, LS travel retail, Gebr Heinemann and The Nuance Group, to name a few.

Consultants to assist in handling the tendering process are expected to soon be appointed.

Air Passenger Duty (APD) - unfair tax or polluter has to pay?

Definition - "Air Passenger Duty (APD) is an excise duty which is charged on the carriage of passengers flying from a United Kingdom airport on an aircraft that has an authorised take-off weight of more than ten tonnes or more than twenty seats for passengers. The duty is not payable by inbound international passengers who are booked to continue their journey (to an international destination) within 24 hours of their scheduled time of arrival in the UK".

The amount charged depends upon the distance you will travel to your destination ranging from £12.00 on the shortest European destination to £85.00 for over 6,000 air miles. When introduced in 1994, APD was sold to the public as a variant of an environmental tax. But, unlike the EU Emissions Trading Scheme which incentives airlines to use their aircraft more fuel efficiently, APD is a flat rate tax per passenger that does nothing to help the environment. Even the UK Treasury has now admitted that it's primarily a revenue raiser.

However, the British Government has decided to increase this charge, despite them collecting £2.2 billion in revenues in 2011, to twice the level of inflation from April 2012 causing the whole of the travel and tourist industry to be in arms.




The new rates in their "band" format are punishing especially for families travelling - a family of four will pay £52.00 in tax to Spain, £260 to Florida and £368 to Australia (and that is for Economy Class).

With UK airport passengers numbers the same as 2004 it is becoming increasingly more difficult to attract tourists for duty free shopping. It is worth noting that 22 out of 27 EU countries have no similar tax so it no wonder that Italy attracts three times more Chinese tourists than the UK... and a similar story with Germany and France.

So, is this an unfair tax on UK holiday makers, UK tourism and UK businesses..... or a way tax the polluters?