AUSTRALIA. Leading fast food chain McDonald’s has stated its ambition to extend its footprint at Australian airports in coming years, but has said that the economics of airport commercial services remains a challenge.
Speaking at the Australian Airports Association (AAA) Retail & Commercial Forum on 19 July, McDonald’s National Property Director Skye Baker said: “Airports are a space we want to play in, not just in Australia but globally. For us, what is important is how we differentiate our offer and be relevant in the face of competitors that are doing some amazing things.”
But, she added: “The cost of occupancy at airports is higher than for our usual business, it is less convenient and more expensive for our staff to get there. So as we go into this ambitious growth strategy we’d like to reset how we negotiate with airports. We would like a partnership where we each identify what we need, and then try to get to scale the opportunity.
“This is not our core business, so we want airports to help us understand what is behind the commercials. What drives the business? We each have a set of requirements we need to meet in a negotiation. We want to be there for 20, 30, 40 years so let’s begin with a strong foundation. I don’t think I understand the drivers that are critical to airports, and we need to do a better job of educating them on our requirements too. If we do that we can have more efficient conversations and get more stores open.
“We want to do that because we do see airports as an opportunity. We want to ensure our footprint is extensive and that when people travel, if they expect to see McDonald’s that we are there.”
McDonald’s presence in Australia spans over 1,000 stores, over 200 licensees, 115,000 employees and more than two million customers served daily.
“We would like to get to 1,500 stores in the next five years, mostly in precinct and drive-through, which are our main sites. At airports we do a good job in international terminals and we see an opportunity in the drive-through option.
“Our aim is to be the most convenient option most of the time,” Baker said, “and increasingly to tap into the customer occasion-based offer.”
On what will drive growth in the airport sector, she said: “Value is critically important; our customers want great value, service and consistency in great tasting food.
“Among the big drivers is ensuring our tech is right – digital is important at airports. Airports don’t want us blocking thoroughfares and we need to move people quickly. That can involve kiosks for ordering but also concepts such as our Kitchen in the Sky at Sydney Airport, where you can see the food being made and delivered down. That is a highly Instagrammed location and we know that theatre does drive higher ticket.”
Baker was speaking on a panel about growing F&B at airports. Other speakers included Craveable Brands Chief Development Officer Simon Thompson, FoodCo Group Hospitals & Transit General Manager Tony Brusch, Airport Retail Enterprises CEO John Chapman and Queensland Airports Group General Manager Commercial Revenue Isabelle Yates.
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