Active repair work is underway throughout Portugal.

The Deputy Chief Commercial Officer and Deputy General Manager of Aer Rianta International (ARI), Anthony Kenny, shared with TRBusiness about the new Portugal Duty Free joint venture, which has exceeded expectations and is performing well thanks to an active summer season.

As previously reported, ARI began fulfilling its duty free and mandatory duty free obligations under its contract with ANA Aeroportos de Portugal, owned by Vinci Airports, as of June 1. During an exclusive interview for TRBusiness Top 10 International Operators, Kenny spoke about the ongoing major redevelopment project, which is part of an 18-month implementation strategy and includes 34 commercial spaces totaling 10,000 square''meters.

"Teams are in the process of finalizing detailed project design and procurement and are working to deliver the exciting and innovative retail concepts we introduced earlier this year, such as Port Cellar, Dream Avenue and Love from Portugal," said Kenny. "More than 600 new colleagues have joined ARI as part of the new Portugal Duty Free project and are immersed in everything from operations to corporate culture. "There is excellent collaboration between the teams, with many of our colleagues from ARI head office continuing to travel to Portugal to support our new Portugal Duty Free team." Anthony Kenny, chief commercial officer and deputy CEO of ARI.

Lack of visibility is a major problem

B''s wide-ranging interview, Kenny called 2021 a "turning point" for the business, noting slow and gradual improvement in several locations. "There were many reasons for optimism in 2021, including the successful relocation of the Bahrain retail business to a new terminal and stunning new stores at Bahrain International Airport; solid results from the Riyadh business due to its location in the domestic terminal; ARI's Cypriot retail business performed well during the peak season of the year and returned to profit in 2021; and Montenegro completed work with the opening of our new retail stores in the first half of the year. "

It is telling that a number of ARI's operations, namely in Canada, India and New Zealand, have been hit hard by the pandemic and''tight travel restrictions. ARI's total turnover for 2021 was €468m ($529m), representing an increase of 40% on 2020 and a 39% share on 2019. As Kenny notes, the main challenge remains a lack of visibility into the short, medium and long-term impact of geopolitical conflicts, rising inflation and consumer spending. "The level of airport disruption and passenger restrictions, for example, have been widely underestimated by airport companies this year, and all of these could present potential future challenges for the free trade sector," he explained.

The ARI company declined to comment on issues relating to the contract concession fee clauses in''Portugal or possible margin erosion in the short term due to the current macroeconomic and geopolitical instability, TRBusiness set.

While the industry continues to face pressures from supply chain disruptions, inflation-related cost increases and rising energy prices due to the war in Ukraine, the multi-industry retailer is cautiously but resolutely optimistic about the situation. "Business is going well this year and there are ambitious plans for growth, with the hope of continuing the recovery in the industry through to the end of 2022 and 2023," commented Kenny. "Our category teams are working hard to prioritize novelty, exclusive free trade products and inclusive''promotions to cater to a variety of customers'.

"We pride ourselves on creating a special atmosphere at each of our locations, creating a unique experience for passengers that captures the essence of each location. Most importantly, it attracts customers and generates revenue. "Retail theater and marketing activities are back on the agenda in all of our stores around the world, and our teams are doing a wonderful job. It's an integral part of our approach '\''Experience is everything'\'' and brings joy to the world of free trade. "

New brand strategy for 2023

The company continues to invest in its 'Center of Digital Excellence' to connect with passengers at the pre-travel stage through hyper-connected experiences, TRBusiness has learned.

Kenny notes that the core elements of CVP remain the same regardless of the challenges that arise. ARI and its partners in Portugal are upping the business ante in the long game.

"These key elements include a commitment to offer exceptional assortment and value, superior gift solutions, hyper-connected experiences, special ambience, retail theater, enhanced convenience, superior customer service, sustainability leadership and shopping safety," he emphasized. "Over the past two years, we''are implementing changes within our new Customer Offering to further enhance the customer experience and there are currently over 60 initiatives underway across our estate. Our Customer Offer will be significantly strengthened by our new brand strategy, which we look forward to unveiling in early 2023. "

There are a number of major concession tenders expected, particularly in Spain, where Aena this month attracted potential bidders, and further details of the lots on offer are expected to be offered when the tender comes to market. ARI was among those present at the introduction of Aena's tender in Cannes. Asked about the company's possible participation in the Spanish airport tender and other upcoming''s tenders, including those for Terminals 3 and 4 at King Khalid International Airport in Saudi Arabia, Kenny responded cautiously.

"We are careful in our tender selection - we are strategic in our bid and know we can add real value. We are hungry for growth and are actively pursuing a range of opportunities at the moment. "We demonstrated our capabilities with the opening of Portugal Duty Free this year and this has confirmed our ambitions for continued growth. We have a world-class team and a global talent network, with a competitive and attractive proposition for potential partners in the future. "

Sustainability is not optional

Sustainability remains one of the company's top priorities. 'It's not optional''for any business or industry, and that's always been the case at ARI,' emphasizes Kenny. "Our partners, brands, teams and clients expect this from us. "We are increasingly exploring ways to translate our ESG strategy into the retail environment and help our clients make sustainable changes, for example through our new global marketing campaign Little Changes, Big Difference. "

For more information on ARI's global business activities, click here to read the "Top 10 International Operators" report.