SINGAPORE. The watches tender covering the duty free concession at the new Terminal Three has attracted predictably hot competition.
Eight bidders – Cortina Watch, DFS Venture Singapore (DFS Group), Gassan Diamonds, Leisure Image, Luxury Ventures (Valiram), LVMH Watch & Jewellery Singapore (for TAG), Richburgh Holdings and The Swatch Group – lined up for the contract, which covers several outlets in T3’s Departure Transit Lounge. Bids closed on 1 March for the concession which runs initially for three years from 1 January 2008 – or whenever T3 opens – with an option to extend for a period of two years.
In a complex bid, tenderers could submit bids for either one, two or all of the three available options below. Based on the bids, it looks like LVMH/TAG and Gassan Diamonds (just ahead of Richburgh Holdings) may be the front-runners, though if the Civil Aviation Authority of Singapore (CAAS) opts for a different permutation, DFS could come through. Everything depends on whether the CAAS chooses a combination of options one and two – or option three.
Noted one well-placed source: “Basically it is their [the CAAS] choice – do they go with two multi-brand stores [run by one company] and [separately] one mono-brand store, in which case it looks like Gassan and LVMH [with TAG]? Or do they go with one operator for the three stores, in which case it will be DFS. But on the bids it looks like having one operator run two stores plus a separate mono-brand operator will bring more money to the authority.”
Bidding options
Option 1 : (i) A shop of around 138sq m at Departure/Transit Lounge North, Second Storey, T3 (“˜Premise A1′); and (ii) A shop of around 174sq m or thereabouts at Departure/Transit Lounge South, Second Storey, T3 (“˜Premise A2′);
Option 2: A shop of about 41sq m at Departure/Transit Lounge South, Second Storey, T3 (“˜Premise B’);
Option 3 : (i) A shop of about 138sq m or thereabouts at Departure/Transit Lounge North, Second Storey, T3;
(ii) A shop of about174sq m at Departure/Transit Lounge South, Second Storey, T3; and
(iii) A shop of about 41sq m at Departure/Transit Lounge South, Second Storey, T3 (comprising Premises A1, A2 and B)
Importantly, tenderers bidding for Option 2 and/or 3 had to propose a single brand-name watch boutique for Premise B.
Here are the bid details:
OPTION 1 – (PREMISES A1 AND A2)
Gassan Diamonds: An additional rental of either: (a) 20% of the total monthly gross sales; OR (b) a minimum monthly guarantee of S$333,360 in Year 1, S$370,400 in Year 2 and S$407,440 in Year 3; whichever is higher of (a) or (b).
Richburgh Holdings: An additional rental of either: (a) 20% of the total monthly gross sales; OR (b) a minimum monthly guarantee of S$368,000; whichever is higher of (a) or (b).
OPTION 2 – (PREMISE B)
LVMH Watch & Jewellery Singapore: An additional rental of either: (a) 20% of the total monthly gross sales; OR (b) a minimum monthly guarantee of S$75,000 in Year 1, S$100,000 in Year 2 and S$150,000 in Year 3; whichever is higher of (a) or (b).
The Swatch Group: An additional rental of either: (a) 20% of the total monthly gross sales; OR (b) a minimum monthly guarantee of S$80,000; whichever is higher of (a) or (b).
OPTION 3 – (PREMISES A1, A2 AND B)
Cortina Watch: An additional rental of either: (a)18.5% of the total monthly gross sales; OR (b)a minimum monthly guarantee of S$285,010; whichever is higher of (a) or (b).
DFS Venture Singapore: An additional rental of either: (a) 20% of the total monthly gross sales; OR (b)a minimum monthly guarantee of S$433,800; whichever is higher of (a) or (b); PLUS 8% on incremental sales above S$22,000,000 if annual sales > S$22,000,000.
Gassan Diamonds: An additional rental of either: (a) 20% of the total monthly gross sales; OR (b)a minimum monthly guarantee of S$375,030 in Year 1, S$416,700 in Year 2 and S$458,370 in Year 3; whichever is higher of (a) or (b).
Leisure Image: An additional rental of either: (a) 20% of the total monthly gross sales; OR (b) a minimum monthly guarantee of S$418,000; whichever is higher of (a) or (b).
Luxury Ventures: An additional rental of either: (a)18% of the total monthly gross sales on the first S$1,800,000 of sales and 20% on incremental sales above S$1,800,000; OR (b)a minimum monthly guarantee of S$324,000 in Year 1, S$339,000 in Year 2 and S$354,000 in Year 3; whichever is higher of (a) or (b).
Richburgh Holdings: An additional rental of either: (a)20% of the total monthly gross sales; OR (b)a minimum monthly guarantee of S$401,000; whichever is higher of (a) or (b).
MORE STORIES ON SINGAPORE CHANGI AIRPORT
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Phoenicia Trading backs Changi ambition with strong bid for T3 cigar concession – 23/02/07
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The race for Changi: Lotte and DFS go head to head in liquor and tobacco contest – 15/02/07
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