By: Stephen Clark, C.M., Deputy Director, Airport Commercial Development
When the concessions team at the Sacramento International Airport (SMF) sat down to look at the opportunity to recreate their food and beverage program they agreed that they wanted to approach it in a radically different way.
Food and beverage programs bring revenue to an airport, of course, and travelers certainly need dining options, but the types of food offered can also communicate identity and inclusivity. SMF is primarily an origin and destination airport with only five percent of passengers waiting on
connections. The concessions team at SMF sought to create a program that would highlight Sacramento’s vibrant farm-to-fork culture, offer a sense of place, and give guests a sense of value for money from quick service eateries to premium sit-down experiences.
All these considerations were on the mind of the concessions team at SMF while preparing a Request for Proposal (RFP), which saw nearly every tenant space up for grabs.
Beginning in 2022, SMF began reaching out to hundreds of organizations alerting them to the upcoming RFP opportunity, including partnering with the local Small Business Development Center (SBDC). Instead of only asking major food and beverage operators to recruit local restaurants, the SMF team heavily advertised the opportunity directly to local business owners. Later that same year, they surveyed guests and utilized a research group to learn that health, affordability, and choice of cuisine were high priorities for travelers.
When it came to setting goals and crafting the RFP, the team wanted it to be accessible to both small businesses and large proprietors. They petitioned the Federal Aviation Administration (FAA) to set an ambitious 15 percent goal of Airport Concessions Disadvantaged Business Enterprise (ACDBE) businesses and a small business goal of 30 percent. When the RFP was completed the ACDBE result was 38 percent of the program, and small businesses represented 44 percent of recommended awardees.
“We wanted to create genuine opportunity for small and large businesses alike to ensure equitable conditions for consideration,” said Andrew Durkee, Concessions Manager, Sacramento County Department of Airports. “It was important to us that the best concepts and a superior customer experience rise to the top and we crafted the FRP to reflect that.”
Durkee, and his team continued to partner with SBDC to provide coaching and education to businesses interested in proposing. Of the awarded contracts one local business became ACDBE certified, and another took advantage of extensive coaching through the SBDC. This was so successful that SMF formalized a partnership with the SBDC to continue offering seminars and educational opportunities for local businesses to learn more about different avenues available to work with the airport.
In another break with tradition, the team decided to forgo a traditional minimum annual guarantee (MAG) in favor of rent as a pure percent of gross revenue based on category. Durkee explains that ditching MAGs creates a “flexible and equitable approach to concessions, one that aligns with industry recommendations and promotes a healthy, competitive environment for all stakeholders involved. This move is expected to foster a more dynamic and responsive concessions program, benefiting passengers, concessionaires, and the airport alike.”
Overall, the new program represents 18 new concepts which will replace or upgrade existing facilities in phases beginning in 2024. Included in the new concepts is a local Michelin listed taco restaurant Nixtaco) as well as the Airport’s first pan-Asian offering, Bambuza Vietnam Kitchen + Bar. There is also a local brewery, Sacramento’s first distillery, plus a smattering of other well-known local restaurants.
Stephen Clark joined Sacramento County Department of Airports (SCDA) in November 2021 and is responsible for the commercial and tenant activities at SMF, MHR, SAC, and F72. Charged with oversight and leadership of SCDA’s business development, air service development, communications/marketing, agreements with airlines and other tenants, including concessions, rental cars, and transportation network companies, and leasing of airport facilities and land.
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This article was provided by a third party and, as such, the views expressed therein and/or presented are their own and may not represent or reflect the views of Airports Council International-North America (ACI-NA), its management, Board, or members. Readers should not act on the basis of any information contained in the blog without referring to applicable laws and regulations and/or without appropriate professional advice.
