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ARN News Briefs

AMAC Urges DOT to Suspend PNW
AMAC has petitioned the Department of Transportation (DOT) to suspend the Personal Net Worth (PNW) provision in the newly promulgated Disadvantaged Business Enterprise (“DBE”) airport concessions rules (49 CFR Part 23). In a letter to Norman Mineta, Secretary for the U.S. Department of Transportation, William Swift, AMAC Chairman states that the provision is, “…inconsistent with the goals of the airport DBE concessions program, is harmful to the growth and development of airport concession DBEs and is detrimental to interests of airport operators and ultimately the traveling public.”
The letter goes on to say, “On behalf of AMAC’s Board of Directors and membership…I respectfully request that you exercise your discretionary authority to immediately suspend the implementation of the “personal net worth” (“PNW”) standard of new Subsection 23.35 of the rule.”
Swift states why the suspension is justified and elaborates on the following points: the PNW standard is not constitutionally required; the concept of it distorts the fundamental purpose of the DBE program; the standard is not empirically based; more time is needed for guidance; and the PNW has unintended and unfair retroactive effects.
“For the above reasons and more, even if a PNW is ultimately retained, AMAC urges you to suspend implementation of new Subpart 23.35 so that comprehensive transition rules and regulatory guidance can be developed,” states Swift. “The lack of such transition rules and guidance is causing confusion for airport staff responsible for administering the rule and material harm to DBEs.”
Hudson Group and CNN Sign Exclusive Co-Branding Agreement
Hudson Group has signed an exclusive agreement with Cable News Network (CNN) to pursue joint marketing and retailing objectives, which includes featuring CNN news feeds in selected Hudson News airport locations. In addition, the two companies will work together to develop new, co-branded “CNN Newsstands” in airports throughout the United States. Specific locations for these stores are yet to be announced.
“We are delighted at the pairing of our flagship concept, Hudson News, the nation’s leading newsstand brand, with CNN, the most trusted name in news,” says Joseph DiDomizio, executive vice president and chief operating officer for Hudson Group. “We think these new ‘media sections’ will make shopping in our stores more fun and exciting – coupling the immediacy of a CNN telecast with the full functionality and convenience that travelers have come to expect from Hudson News.”
“Hudson News has a proven track record in airport concessions and we are pleased to collaborate with them on this endeavor,” said Scot Safon, senior vice president, CNN marketing and on-air promotion. “This agreement builds upon the successful strategy we put in place in 2005 to give even more consumers access to our award-winning products and services in an airport environment.”
Wawa Lands at Northeast Philadelphia Airport
Wawa, a privately held food market company, will celebrate the grand opening of its 41st store on the grounds of Philadelphia International (PHL) on Friday, June 2. The festivities include a “Hoagies for Heroes” hoagie building contest between the police officers of Philadelphia’s 7th and 8th Districts. The contest will benefit a local charitable organization of the precincts’ choice.
“We are thrilled to be located on airport property and look forward to serving not only the local residents but also the opportunity to serve the customers and employees of the Philadelphia Northeast Airport, says Howard Stoeckel, CEO of Wawa. “As you know the goose is our Wawa logo and just as geese fly in formation for greater efficiencies the Wawa family prides itself on working as a flock to fly higher and faster to better serve the community and its customers.”
The airport location is one of Wawa’s new store design prototypes and features 5700 square feet of retail space. The store will offer airport customers and employees Wawa brands such as the award-winning Wawa coffee (more than 190 million cups sold annually); the Sizzli(TM)?, Wawa’s hot breakfast sandwich; a full-service deli; Wawa Bakery; Wawa’s built-to-order hoagies (more than 48 million sold annually); and Wawa’s beverage line of dairy products, juices and teas.
The new store will also feature Wawa’s branded gasoline operation, which includes a state-of-the-art CRIND (credit card reader) system enabling customers to complete credit card transactions right at the pump; it also includes Blink transactions, the newest contactless credit card system.
Famous Famiglia
Famous Famiglia has been listed as among the Top 25 Franchises for Prospective Hispanic Franchisees by Hispanic Trends magazine. “Such recognition notes our corporate commitment to recruit prospective franchisees from the Hispanic community,” says Giorgio Kolaj, executive vice president, corporate business development for the company. The list will be published in the July/August issue of the magazine.
Palm Springs to Upgrade Concessions
If approved, Palm Springs International will expand and optimize its concessions program through a plan developed by consultant, Simat, Helliesen & Eichner Inc./Center for Airport Management.
In part the plan is to capture the spirit of Palm Springs and the greater Coachella Valley, inspire travelers with a “sense of place” and beef up revenue, according to an article in The Palm Springs (CA) Desert Sun. In FY 2004-2005 sales totaled $4.6 million, or an average of $6.55 per enplanement. This could rise to $8.85 million under the proposal, or nearly $10 per enplanement, assuming projected air traffic growth materializes.
Borders® Opens Second Store at BWI
Borders Group, Inc. will open a new 1,050-square-foot store in the main terminal of the Baltimore/Washington Thurgood Marshall International (BWI) in early July. The new store will feature bestsellers and key titles for leisure and business travelers offering over 5,000 book titles, including audio books, a limited selection of magazine and newspaper titles, and top selling DVD and CD titles.
“Baltimore/Washington International is a fantastic airport and we are pleased to have the opportunity to open another store there and to continue to be part of its vibrant retail community,” said Tony Grant, senior manager of the airport program for Borders Group, Inc. “We are committed to connecting books and readers, and offering our customers the most relevant assortment. This new store at BWI will provide travelers with a comfortable and convenient place to discover a new author or pick up the latest bestseller.”
This is the second Borders airport store to open at BWI. The first store, which opened in May 2005, is located in the Southwest Airlines terminal. Borders also operates stores in airports located in Phoenix, Orlando, Seattle, Newark, Boston, Houston, Las Vegas, Miami, as well as in Washington, D.C. and Cincinnati, Ohio.
Chains Outpace Restaurant Industry
The 500 largest U.S. restaurant chains registered solid performance, posting 7% annual sales growth in 2005. In its annual report on the top U.S. restaurant chains, foodservice consultancy Technomic found that U.S. system-wide sales for the Top 500 rose to an estimated $199.9 billion in 2005, up $13 billion over 2004 on a same-chain basis.
“Even as the U.S. economy struggled against rising gas prices and a turn in interest rates, the Top 500 still managed to outperform the restaurant industry at large, which grew 5.6 percent,” said Darren Tristano, managing director of Technomic Information Services.
Significant growth continues to come from the limited-service beverage and other sandwich categories with Starbucks and Subway posting 2005 double-digit sales growth of 20.5 percent and 14.4 percent, respectively. McDonald’s, the largest U.S. restaurant chain grew 5.1% with sales exceeding $25.6 billion. Panera Bread continues to dominate the growing bakery café© segment with 28.6 percent sales growth and total sales in excess of $1.6 billion.
Limited-service chains within the Technomic Top 500 accounted for 82% of all U.S. “fast food” restaurants. As a whole, this group grew at an impressive rate of 7%. Other limited-service sub-segments with sales growth above the segment average include bakery café© (27.8 percent), beverage (19.8 percent), Mexican (12.4 percent), other sandwich (12.0 percent), donut (11.5 percent) and chicken (9.4 percent).
Growth continues to be driven by leading chains. The Mexican category was led by Taco Bell’s 8.4 percent sale growth and quick-casual standout Chipotle, which grew an estimated 27.1 percent. The donut category continues it’s growth with Dunkin Donuts’ 13.8 percent sales and the category’s increased sales of specialty coffee. The chicken segment saw strong growth of 13.1 percent from Atlanta-based Chick-fil-A and an emerging southeastern quick-casual chain, Zaxby’s, that ended the year with over 330 units.
Within full-service segments, the seafood and Asian categories posted strong sales growth rates of 12 percent and 10.5 percent compared to an overall full-service growth rate of 6.9 percent. The varied menu category also outperformed the segment with 8.7 percent sales growth, led by America’s largest casual dining chain Applebee’s Neighborhood Grill & Bar, which increased sales by 8.8 percent. The Mexican, steak and Italian categories all posted strong results with sales growth of 8.3 percent, 7.6 percent and 6.6 percent, respectively. Family-style restaurants continued to struggle, but remained flat.

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