SOUTH KOREA. Incheon International Airport Corporation (IIAC) yesterday opened bids for its first-ever arrivals duty free shop contracts.
A bidders’ briefing meeting will be held on 12 February and the tender closes on 14 March.
IIAC is offering two concessions – both restricted to the country’s small & medium enterprises (SMEs) and therefore excluding sector giants Lotte, Shilla and Shinsegae.
One concession covers two shops in Terminal 1, embracing total space of 380sq m. The other is for a single 326sq m store in Terminal 2.
New evaluation criteria to cool ‘overheating’ market
IIAC will assess bids on the basis of a 60% weighting for the business (technical) plan and 40% on the financial proposal. Under the country’s controversial two-tier judging system, the corporation’s results will then be handed to Korea Customs Service for a final evaluation and choice of winners.
In a critical change, introduced by Korea Customs Service on 1 February 1, IIAC scoring will count for just 250 of the final 1,000-point rating that will dictate the victors. The move is intended to reduce the emphasis on the financial component of the tender and thus cool what the government agency views as overheated bidding competition.
According to one leading local agent, Korea Customs Service’s scoring system will give preferential weighting to bidders with a low debt burden.
Bidders must offer a minimum guarantee rate (MGR) per category – 21.7% for perfumes & cosmetics; 22.3% for general merchandise; and 26.3% for liquor. Tobacco products are excluded from the arrivals offer.
Likeliest candidates for the contracts include Busan Duty Free, CityPlus Duty Free, Daegu Grand, Dufry Thomas Julie (operator of one of the two concessions at Gimhae International Airport in Busan, and classified as a SME) and Entas Duty Free.
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