World Duty Free and Flemingo Duty Free pushing hard to get extension at Colombo Airport without Tender…

Sep 10, 2015

With the end of the current 5 year terms of  both World Duty Free Group  (WDF)  and  Flemingo  at the Bandaranayake International Airport in  June 2016, Airport and Aviation is expected to announce the new tender for the Supply and Operation of the Duty Free Shops  at  the  Colombo  Airport  shortly. As per regular procedures an evaluation period of 3-4 months is required for the selection and award of this lucrative business. The tender is usually published approximately 9 months prior to the evaluation.

The Colombo Airport currently handles over 7m passengers annually. Current duty free sales for the airport is estimated at between USD70–80 million annually (over 1 billion rupees per year), shared between the two main players WDF and Flemingo.

 

It is learnt that both incumbents WDF and Flemingo, are lobbying hard at the highest levels to extend their current contracts by an additional 5 years, without tender. Airport and Aviation is expected to do their due diligence and review the marketplace for different Duty Free Operators prior to giving away this lucrative business to WDF and Flemingo. As an example of gauging the marketplace for the best possible fit, in July 2014, Singapore’s Changi Airport added Korean travel retailer Shilla Travel Retail (The Shilla Duty Free) replacing long-time incumbent Nuance-Watson (Singapore). Changi Airport’s Duty Free is now operated by both DFS Ventures Singapore and Sheila Duty Free.