CHINA. Beijing Capital International Airport (BCIA) has reshaped its management structure to move in line with international trends.
Formerly a unit within the airport authority, the commercial part of the organisation has been split from the authority, and, from January, has been standing alone as the Beijing International Commercial and Trading Company.
This new company not only handles commercial operations of the BCIA, but also those of airports in Wuhan, Jiangxi, Sichuan, Tianjing and Fujian, all of which have been acquired by BCIA.
Foster Fu, Manager in charge of Duty Free Purchasing of the new commercial company, told The Moodie Report: “We wanted to follow trends in other airports, where non-aeronautical management of the airport is independent from its aeronautical operations.”
At the moment, China Duty Free Group (CDFG) still has an exclusive right to supply the airport with products. Asked if this could change following the formation of the new company, Fu would not speculate, but did not rule out that current arrangements may change in the future.
He is now exploring and studying new strategies and concepts of display and service for a new terminal three which will be up by 2007.
He noted that “display and service standards are still low” at the current terminals. However, sales are growing.
Compared to 2002 (2003 was affected by SARS, and hence not representative), sales grew +66% overall last year.
In particular, cosmetics and fragrances saw the largest growth, +104% over the same period a year earlier. Tobacco and liquor grew more modestly, up by +14%.
The airside areas of the terminal are “very full” at the moment, so only minimal changes are being made to the offerings. A duty free shop located across from the Hermès boutique, for example, has been turned into a Chinese traditional crafts store.
The airport is also looking to introduce a Cartier boutique this year.
“We are prepared to let go of the jewellery shop to accommodate this new Cartier boutique,” Fu said.
Contacted by The Moodie Report, China Duty Free Group declined to comment on the possibility of changes to its supply relationships with Beijing. As we recently reported, the company has recently restructured its management and has ambitious plans to develop its business in 2005. More details will be revealed at the appropriate moment.
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