“Battling for Profitability.” ARRA Leaders Speak at FAB Conference

​Challenging the Concessions Status Quo. ARRA and The Moodie Davitt Report co-organized this “electric” and “compelling” session (in Dermot Davitt’s words) at the recent Airport Food & Beverage (FAB) + Hospitality Conference. Moderated by The Moodie Davitt Report’s President and Editorial Director Dermot Davitt and featuring ARRA board members David Bisset of Paradies Lagardère and Greg Plummer of Concord Collective, Deanna Zachrisson of San Diego International Airport, and ARRA Executive Director Andy Weddig, this panel tackled an important topic: our industry’s financial capability to continue to deliver the beautiful venues, great experiences, and exceptional service celebrated throughout the conference. ARRA members have made great strides to enhance the passenger travel journey over the years. But, partially due to Covid, partially due to political pressures, partially due to our own successes, we have arrived at a crossroads and together with our airport partners must make a choice about our future, as well as the future we present to our customers.

Greg, David, and Andy spoke to many key issues ARRA members face in financing and operating their businesses. Here are three key takeaways:

• The cost of capital is a high hurdle for smaller companies. Greg notes, “we pay more for capital.”
• There’s a disconnect between airports wanting local concepts and the impact to profitability of those concepts. David says, “balance is key.”
• The combined impacts of higher costs and lagging sales have essentially eliminated our businesses’ profitability. Andy expects a reckoning: either airports and concessionaires collaboratively change the framework, or outsiders will change it for us!

We are an industry at a crossroads. This panel only started the discussion. There is much left to talk about – and to do!
 
Read more about this informative and provocative panel at The Moodie Davitt Report recap linked here. Dermot’s article offers much to ponder and discuss about our industry’s collective future. Please read. Please join the conversation.