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Denver issues duty-free/duty-paid RFP

The City and County of Denver’s Department of Aviation has issued a request for proposals (RFP) for two duty-free/duty-paid locations at Denver International airport (DIA). The concessions are offered on a non-exclusive basis and the contract duration is seven years.

According to the RFP document, the concession covers a speciality retail duty-free/duty-paid concession covering two locations, one in concourse A’s centre core covering about 2,315sq ft (215sq m) and the other in concourse B’s mezzanine centre core spanning 2,328sq ft (216sq m). Optional storage space is also available to hire as part of the contract.

The space may be subdivided into separate areas for duty-free and duty-paid offerings, the airport said. No dual branding will be permitted and no advertising or sponsorship is allowed in the concession space. The RFP document added: “The operator of this speciality retail opportunity will be required to provide tax- and duty-free/duty-paid merchandise and services to international and domestic passengers in concourses A and B at DIA. International passengers may purchase all items including speciality fragrances, liquors, and tobacco. Domestic passengers may purchase anything except liquor and tobacco.”

Proposers need to meet the following minimum qualifications in order for proposals to be submitted: at least five years of experience within the past eight in the ownership, management or operation of a speciality retail business running duty-free or duty-paid shops; minimum gross sales of at least $3m a year for each of the qualifying years described above; financial capability to guarantee or finance improvements and operate the concession; and any Airport Concession Disadvantaged Business Enterprise (ACDBE) requirements—a goal of 25% has been established for this concession opportunity.

The winning bidder will be required to pay a proposed percentage of gross revenue or a minimum annual guarantee (MAG), whichever is greater. Proposers must indicate the percentage fees offered for revenue up to $999,999, between $1m and $1,999,999 and for $2m and over. The MAG will be payable in equal monthly installments, and if the percentage fee is higher than the minimum monthly guarantee (MMG, one-twelfth of MAG), the difference between that fee and the MMG shall be paid to the city. The minimum MAG for this concession is $325,087.

All proposals must be received by June 28. More information can be found at the airport’s Business Center website.