Setur Duty Free plots ambitious future as Istanbul Sabiha Gökcen concession comes on stream – 24/07/08

TURKEY. Setur Duty Free last week took over the 20-year duty free concession at Istanbul Sabiha Gökcen International Airport (as reported), a concession that will help “rejuvenate” the company’s fortunes, according to Setur General Manager Üstün Özbey.

Setur began trading on 10 July at Sabiha Gökcen, Istanbul’s second airport, which was taken over by a consortium including GMR, Limak and Malaysia Airport from 1 May.

As previously reported, Setur was awarded a 20-year exclusive contract for the duty free business, which will operate from 4,500sq m of space in a new terminal currently under construction. The new terminal is scheduled to open on 20 October 2009. Since last week the retailer is operating in around just under 400sq m of space, with two Departures shops and an Arrivals shop.

Speaking to The Moodie Report at the company’s offices in Istanbul, Özbey underlined Setur’s long history in Turkish duty free, and the opportunities for both airport and land border retailing that lie ahead.

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“Setur was the leading operator in the Turkish market since 1965, until the airports’ privatisation programme began around 1998,” said Özbey. “But that business shrank as we lost the main concession at Istanbul Atatürk, Ankara, Izmir and Dalaman following the privatisation process.

“Now, over the past two years we have been making a comeback. In 2006 we won the exclusive rights to the duty free stores on the Turkish borders. Now, the contract at Sabiha Gökcen gives us entry to one of the region’s most important airports, and the fastest growing. In each of the past three years passenger traffic has risen by +60%, and there is a lot more potential, which we and our partners at the airport consortium intend to exploit.”

The 20-year contract was a major boost, he said. “We don’t want to get into short-term contracts,” said Özbey. “That was the way in the past. This way, it gives us the confidence to invest, and the airport has the security of being able to plan for the longer term. This will be a proper partnership. We will do our business plan together, we’ll market the location to airlines together, and we’ll plan the exact layout of the space together.”

On the borders, Setur last year opened new stores on the Iraqi and Syrian borders, with its new outlet at Kapikule on the Bulgarian frontier opening in February 2008. At the end of 2008 it will open its new store at Sarp on the Georgian frontier.

Setur also has a business at many of Turkey’s key ports, and operates the inflight retail programme for most of the country’s leading scheduled and charter carriers, including Turkish Airlines. The company also continues to operate specialist shops at most of the major airports in Turkey.

Setur is part of the Koc Group, one of Turkey’s largest companies, which operates in the automotive, energy, banking and electronics sectors, as well as tourism and duty free.

A full report on Setur’s business, and an interview with its senior management team, will appear in The Moodie Report Digital Print Edition for September, along with full profiles of the key airports and the country’s other duty free players.

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