CHINA. In major breaking news, Beijing Capital International Airport has issued a dual tender notice covering its duty free retailing concessions at Terminals 2 and 3. The businesses are currently run by Sunrise Duty Free.
The notice was issued on 24 February. Bids for the two tenders (offered separately) close on 6 April.
The two tenders have been issued through Beijing World Trade Corporation, which Beijing Capital International Airport appointed as its bidding agent last year. Joint ventures (subject to certain criteria – see below) will be permitted.
Informed sources in China told The Moodie Davitt Report today that it is unclear whether a single bidder could win both contracts, with a splitting of the business considered a strong possibility by some.
Sunrise Duty Free is certain to mount a robust defence of its business in the face of likely challenges from China Duty Free Group, China National Service Corporation for Chinese Personnel Working Abroad (CNSC) and possibly Orient King Power.
The tenders cover:
1) T2: international terminal departures area – 3,186sq m; arrivals zone – 417sq m
2) T3: outbound international – 9,461sq m; arrivals 1,939sq m
Categories covered by the contract include perfume & cosmetics, tobacco & liquor, confectionery, fashion and accessories, watches, jewellery and other items.
Bidding criteria include:
1. Companies should be registered in accordance with the law of the People’s Republic of China, with a duty free business qualification of being state-owned or a Sino-foreign joint venture;
2. Bidders (or their lead partner) must have been operating duty free business in China or an investor in duty free shops in China;
3. Similarly, they must have the authorised approval/right to import duty free goods;
4. Bidders (or their lead partner) must have three years’ experience of operating duty free in China and have posted continuous profitability from 2013 to 2015;
5. They must have a clear five-year track record of having operated without law violations.
Beijing Capital International Airport handled 94,393,000 passengers in 2016 (domestic and international), up +5% year-on-year.
In January 2017, the airport handled 8,180,000 passengers, a +8.6% increase in year-on-year. Passenger numbers on international, Hong Kong, Macau and Taiwan routes rose +10.5% year-on-year.
Note: The Moodie Davitt Report has worked with its informal Chinese partner Duty Free Expert on this story.
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