Airport food, beverage retail and passengers’ fond memories

Technology is making a lot of difference to food and beverage sales at airports. The conventional brick and mortar restaurant model is confronted with a new generation of technology savvy travellers who will need to be satisfied at the airport by the variety of food and drinks on offer.

In making offerings of food and drinks several concerns are in the minds of customers. With the increasing advocacy by activists, health, religion, ethics and even a concern for local variety may not be too far away a concern for travellers. These are concerns likely to influence choices as well as the budget of the traveller on food and drinks.

One of the things that technology has enabled today is a desire for the travel experience to begin before  getting to the airport. So travellers look out for all the information they need before travel as well as book in advance the services they will need. Food and beverages at the airport is also one of those needs that come into view.

The food and beverage experience will, to a large extent, affect the customer satisfaction at the airport. So airports should take a very close look at the mix of service providers that they have. While the big brands are welcome, the smaller and local variety might also get a space in the airport to meet the needs of travellers and improve upon revenue generation too. Travellers are also conscious of price and this should be borne in mind that where they perceive that items on the menu are overpriced, the spend will be low on food and beverages even as they look forward to enjoying the local dishes in the place the airport is located.

The International Air Transport Association, the global body that represents airlines, reports that passenger numbers could double to 8.2 billion by 2037, and that on average 50 percent of passengers are eating and drinking at airports. This is a market that airlines across Africa need not ignore for improved revenue generation.

The airport environment is very different from the marketplace. The security measures create challenges to staff and concessionaires who want to work and do business at the airport and these may add to costs for those getting into F&B business in an airport.

Some of the costs to look forward to as an airport food and beverage vendor are: employee/staff costs – beyond remuneration, employees will have to be fingerprinted and obtain proper airport identification (ID cards) to remain in employment at the airport. There might be training/classes for some categories such as airside driving if there will be need for deliveries, and these will come at a cost.

Utilities follow standards set at the airport for how they are connected, monitored, provided, and maintained. This also affects refuse and garbage disposal and they come at a cost to the concessionaire too.

Facilities maintenance come at a cost, so daily cleaning, pest management, and routine and preventive maintenance are standard costs for operating any business whether one is in an airport or off it, but may be higher at the airport. The rates and fees are not the same for all airports however.

There are costs associated with doing business in a community, be it an airport or not. These costs will have to be considered such as local business taxes, permits, health inspections, and others.

Some other costs vary according to the airport and geographical location, surveys across the world have revealed. Performance bonds may be required by some airports. This is done to help guarantee that the concessionaire will maintain and operate services according to the terms of the lease agreement. Some airports charge concessionaires for storage and/or office space. Airport concessionaires with a receiving dock should expect that they may be required to use, and pay for, central distribution services and deliveries.

There are some other ancillary costs, such as those for coordinating and transporting goods to and from concession locations at certain times of the day and through security screening. In addition to requiring minimum annual guarantees or a percentage of gross sales, some airports have been known to insist that concessionaires pay a privilege fee to operate on site. An airport has also, from a survey across the world, been reported to insist that a security surcharge is required to help defray the cost of providing security.

Insurance costs are of different types from surveys carried out. Very important requirement is for concessionaires to carry comprehensive general liability and worker’s compensation insurance. The other types of insurance many airports ask for include comprehensive auto liability, liquor liability coverage, and builders’ or contractors’ insurance. Individual airports may require more specific coverage, such as environmental impact insurance or business interruption insurance, some surveys have shown. These may not be a compulsory requirement in some African countries.

Sustainability should also be in the mind of any airport concessionaire. It will affect how airport Food and Beverage is packaged and served. Regulatory requirements are changing especially on the use of plastics that will affect the sourcing and use of plastics at some airports.  Some airports have set targets to be plastic free and this must be considered in taking up a concession there.

Airports should watch out for changes in the behaviours of travellers. As passenger numbers increase so will the diversity and demographics of passengers change at the airport. Food served in that community of the airport contributes to memories of the travel experience. It will not just be about killing time and waiting to board. With a laptop, one can set up an office at the airport and at the same time meet the needs of the body for refreshment.

What an airport makes out of the Food and Beverage offering will come from making the passenger have fond memories of the airport.

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