Takeover timeline – On location as a new travel retail chapter opens at Schiphol

THE NETHERLANDS. Continuity and communication, preparation and people, technology and transition were the watchwords at Amsterdam Airport Schiphol on Wednesday night, 30 April.

The Moodie Davitt Report President Dermot Davitt was on location for the takeover of core category stores by the newly-established joint venture comprising Lagardère Travel Retail (70%) and Schiphol Group (30%), marking a moment of commercial history at the Dutch hub. On the same night Gebr. Heinemann exited its decade-long Schiphol Airport Retail partnership.

The new alliance takes over close to 30 stores, combining perfumes & cosmetics and sunglasses spaces with those dedicated to liquor, tobacco & confectionery.

As reported, the partners plan to combine these core categories under one roof in each lounge, addressing the relative lack of space and the fragmented nature of the duty-free stores at Schiphol today. A template will be set in the new-look Lounge 1 store which opens across a 1,500sq m footprint on 20 June, with Lounges 2 and 3 to follow amid an ambitious refurbishment over the next two years.

In all, say the partners, sales can double over the next decade with more effective spaces and enhanced visibility and opportunity for brands at Schiphol.

We joined Lagardère Travel Retail and Schiphol teams as they undertook the transition overnight from 30 April into 1 May, and as new back office systems and cash till operations came to life. Below, Dermot Davitt presents his timeline of highlights in words, images and audio.

30 May, 1700

There’s an air of expectation and nervous excitement but also cautious confidence among the senior Lagardère Travel Retail team as the final hours tick down to the changeover. Much of the work has been done in advance to ensure that the key tasks – moving the Schiphol Airport Retail back office and cash tills across to Lagardère’s systems – run smoothly.

We’re gathered in the lobby of the Schiphol Hilton Hotel, close to the terminal, where a large transition team has come together from across the Lagardère Travel Retail European network. They come from Italy, Spain, UK and Belgium, plus HQ in France, for ten days to lend their expertise and support.

While nobody in the team expects tonight to be a fully smooth ride, the overall sense in the room is one of calm. That, says the travel retailer’s Opening Director Fanny Depecker, is because of the preparatory ground work plus the large cast of Lagardère Travel Retail experts on-site.

She says the company has taken no chances in this most important of handovers. “We chose experts in every area to support us in this first week and into next, people who have done these transitions before, who can work under pressure and be proactive if we hit any issues.

“We prefer to have a lot of people here over ten days instead of trying to maintain or fix things from distance. You have to be on the ground. Plus we will keep coming back in coming months and over the year ahead to assess what we can improve across systems, IT, merchandising and so on.

“This is a big undertaking as it’s such a big contract, and it was a little scary at first given the short timeline of just a few months, but now we are confident. We have been very transparent with the Schiphol teams and they with us. We have meet each week to ensure a smooth transfer and that information is well communicated to teams.”

On the implementation plan, she says: “In one night we cannot change 30 stores without disrupting the business, so we decided to do it in steps. Tonight we take the first step by changing over Schiphol Airport Reetail. Gebr. Heinemann leaves, taking its systems and supply chain.”

All sales up to 10pm remain with Gebr. Heinemann. This is then accounted for in a final stock round-up, and systems switch over to the new partnership before the stores reopen at 5am.

“We also didn’t want to change too much more over the busy summer peak, so the Kappé systems (for P&C and sunglasses) will change over to the new JV on 1 October. That means another night to mirror what is happening here this evening with Schiphol Airport Retail.”

Not surprisingly, all of the team members we spoke to said their greatest fear was a glitch that could somehow prevent sales being made on 1 May – but nobody believes there is a strong chance of this given the preparation that has gone into tying systems together in the past weeks and months. No matter what else happens, they all echo, business continuity must be maintained.

1800

In a quiet moment before the transition gets into full swing, Lagardère Travel Retail Business Development Director Karim Osman reflects on the bid process that led to this moment. “Schiphol Group was very clear in their intention to re-establish the image of Schiphol as a leading travel retail destination, with price promises and experiences central to this,” he says.

“The process was very open and transparent. It was also short. In a way that was an advantage as it meant we had to focus on the things that mattered most. We created a tailor-made proposal that matched what Schiphol wanted.

“Of the European airport locations we have won through tender outside France, Rome in 2012 was probably the biggest but this is on another scale. And as a company we are better equipped to manage such processes today given how we have grown since then.

The Schiphol Airport Retail team is playing a big part in the transition, and Simon Asmus, long-time Managing Director of the Schiphol-Heinemann JV, describes the process and relations between the parties as “calm, smooth and respectful” since the tender decision was made.

“Naturally these tenders involve competition but once it’s done everyone says ‘fair and square’ and moves on. The professional atmosphere and respect for each other across Schiphol, Lagardère Travel Retail and Gebr. Heinemann has been a positive experience.”

He adds: “Taking on a transition that really only began in February after approval by the Dutch authorities is no easy task, and ideally you would have six months to achieve this, but it has been done well so far in this timeframe.

“Any time there is change that is a challenge. But what we have found is that the teams are willing and open. With openness to start with you can build trust. It’s also important to retain knowledge. And you have to manage the transition with cooperation and collaboration and with a view to the longer term, not simply by pushing your own view on others. You have to take people with you.

“Here for the first time at Schiphol we will have all of the core categories combined under one roof (in each lounge), and therefore staff combined in the same store too. That won’t be easy. But change is a good thing and it keeps us moving forward.”

In common with others he cites data as the biggest factor in ensuring that any transition like tonight’s is a smooth one. “As systems change, any risk to POS or your ability to make a sale is the biggest challenge so we have worked hard to ensure all the systems are aligned across the SAP IT system to cash tills to replenishment.”

1900

Addressing colleagues from Lagardère and Schiphol at a briefing before everyone goes about their overnight jobs, the new JV’s Chief Executive Bruno Gouisset says: “This is a big milestone and a historic night for Lagardère. It’s a new story in a new airport for us, and I’m sure we will look back on this in a few years with pride and say ‘we were there’.”

Fanny Depecker adds further reassurance to teams, encouraging them to work hard and not to forget to have fun. “We are on track, the network is ready, so we should have very few issues.”

2100

Teams are busy across the Schiphol Airport Retail network of stores in the terminal, with the focus on back office systems transition, new price labelling and stripping out existing cash tills to replace them with Lagardère’s.

2130

On a walk through the terminal, we encounter a classy video on the concourse media walls, produced by Schiphol, to say goodbye and thank you to Gebr. Heinemann and to welcome Lagardère Travel Retail (see video below).

2200

The stores are now closed, with a stock assessment by Schiphol Airport Retail to prepare for the early morning opening.

The switch of price labelling continues at pace and as it’s highly labour-intensive, everyone lends a hand. In all, there are over 8,000 that need replacing, and even if these have been primed in advance, the job takes time and care. On some categories such as sunglasses, we note, the price is affixed using a printed label, which means manually attaching a new one to every pair.

The pricing reflects a promise by the new partnership to offer “the best products at the best prices,” which will be communicated to travellers via a campaign that starts in early June. [Click here for more on this in a recent interview with Bruno Gouisset]

2230

Each new cash till is set up individually, with 34 coming into play through the night, and IT teams connecting them to the company’s servers.

But someone needs to test out a purchase, right? In a welcome surprise the Lagardère team invites me to do this – though sadly this is only for illustration purposes and I will have to wait until my flight tomorrow to buy something I can take home.

My choice? Glancing around the store I alight, not surprisingly, on a great Irish whiskey and a reference I enjoy: Jameson Black Barrel.

Having had the intricacies explained earlier of how the SAP system speaks to the cash till system – and the work that has gone into ensuring every single SKU is lined up within the Lagardère eco-system – I feel a nervy moment coming on. Will this work? It does of course, smooth as a drop of Jameson itself, with the process of scanning the bottle through to payment seamless. I even receive a dummy receipt (pictured above), which I’ll carry as a memento of the night.

2300

The progress towards a new operation is progressing serenely, with the odd difficult moment. One item that carried the wrong price in the system skewed the value of the final SAR stock-take, a necessary part of the handover – but because Gebr. Heinemann teams are also on standby through the night, they were quickly contacted and the situation resolved.

During the evening the new JV CEO Bruno Gouisset expresses his gratitude for the “gentlemanly” conduct of Gebr. Heinemann’s management through the transition – this is one example of many.

2335

We reach a landmark moment. At 1130pm the Lagardère Travel Retail – Schiphol Group JV enters force.

A delighted CEO Bruno Gouisset salutes the changeover (click on the podcast below) although as he points out, the game is not over with any systems change until it’s fully done.

“We are all excited. We are happy to see the transition take place. We will open the shops with confidence.

“It’s a huge occasion for Lagardère Travel Retail. We probably over-invested on people and resources but we wanted to get it right. Much was prepared in advance, so tonight has been smooth so far.”

1 May, 0500

The back office transition now complete, staff return to work to find new cash till systems – in which they have been intensively trained since early April – in place. A big moment as the first customer (pictured below) arrives, and to relief around the teams the sale is completed without any alarm.

0700

The final big moment of the overnight transition comes as the first delivery of stock from Lagardère Travel Retail’s Paris warehouse arrives, to be placed in-store once remaining stock from the SAR JV is sold.

As Fanny Depecker points out, Amsterdam’s proximity to its Paris home is a major advantage for this vital project – and it’s one not often afforded to Lagardère Travel Retail with its many openings around the globe.

So concludes a historic day and night for retailing at Amsterdam Schiphol, with Schiphol Airport Retail stores now part of the Lagardère Travel Retail eco-system.

Key takeaways? It’s no surprise that the success of a handover at this scale can only work with detailed preparation and teamwork. Even so, to this outside observer, the smoothness of the process comes as a mild surprise – perhaps it should not, given the regularity with which the major players in our sector complete such transitions. And, in this case, Lagardère Travel Retail also brought a large army.

Notably, the company recently created a dedicated Openings Team led by Fanny Depecker, a move targeted at managing the breadth of new business worldwide, from Lima to Phnom Penh.

Depecker repeats the message that on evenings like these you need people you would take with you into battle – saying that character and commitment are the values that you want in team members to get you through the intensity of an overnight transition that extends to days or even weeks.

The multinational nature of the support teams also tells a story of how Lagardère Travel Retail has grown and built expertise across geographies in recent years. As several of the team tell us, the company is better equipped than ever to manage these changeovers effectively.

That also speaks to a confidence in the group’s ability to execute across business lines from duty free to travel essentials to food & beverage. Every transition of this kind carries risk, so to invite outside observers to witness it first-hand is brave too.

So to the next steps at Schiphol. On 20 June, the new Lounge 1 stores will open, combining the core categories under one roof at the airport for the first time. Watch out for some new concepts and surprises across the categories.

The Lounge 1 store will lead a renovation drive at Schiphol, followed in 2026 and 2027 by other lounges, to create spaces that will be “at the highest standard of European travel retail”, according to Bruno Gouisset.

From June a major consumer campaign will communicate the partners’ price promises, and the Lagardère Travel Retail global animation calendar will include Schiphol locations from June too.

A new brand for Schiphol is being developed and will be unveiled later this year – with translation to the retail look and branding. That will mark the latest in a series of milestones that began on 1 May with the first-stage transition to the new JV and to a new age for retail at one of Europe’s leading airports.