CURRENT TRENDS, CHALLENGES & OPPORTUNITIES IN THE COMMERCIAL

ARENA

ACI 2015PANAMA

OUR PAST

AIRPORT LANDLORDS IN LATAM

15 years ago

• Majority of airports where State owned

• Focus on air side revenues

• Retail had little space

• Traditional side stores

OUR PAST

DUTY FREE RETAILERS – SUPPLIERS

• Multiple operators• Multiple suppliers

This combination created a very competitive environment thatgenerated high bids

Operators had to grow and could only achieve it by gaining newoperations at the airports calling for RFP

Multiple suppliers created a perfect market for operators to obtainnew additional margins to sustain aggressive proposals.

EZEIZA 2003

FIRST MAYOR TRANSFORMATION

Airport privatisation

• Pressure to increase revenues

• Focus on Land side & Retail

Partnership Spirit

• Airports & Retailers working together

• More space

• Walkthrough shops

EZEIZA 2005

PRESENT & FUTURE

FACTS

• Air traffic will increase average 5% - 10% in the next 10 years

• Profit oriented airports regardless of ownership

• New infrastructure requirements

• Consolidation on supplier side

• Consolidation on retailer side

CHALLANGES IN THIS NEW WORLD

CHALLENGES & OPPORTUNITIES

In order to maximize revenues the air related industry needs to create a “different” working environment.

The world and our region will continue to be volatile and with challenging economic environments

Consolidated and stronger retailers and suppliers will have to invest more in order to create the “needed different environments” to increase penetration and conversion rates

Less competition will be a challenge for airports to obtain new high offers from the retailers

One of the key discussion to have is :

HOW TO MAKE M.A.G.´S WORK FOR BOTH PARTNERS

ALTERNATIVES

• Ideally no MAG, substituted by higher % rent

• MAG related to passenger traffic

• MAG related to airline carriers

• MAG related to passenger profile