Airport Experience® News - ACDBE 2023

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and ACBDEs typically come from the businesses within the community, which makes them an organic pairing,” he says. “ACDBEs are in as good or better place than ever because creating a local sense of place in the airport is conducive to promoting local businesspeople, local brands and its community, and who is in a better position to deliver that than the local ACDBEs?” Of course, Amaro warns, this is still a challenging industry, made all the more so when you have less access to capital than other companies. “The challenges we are all facing—which become exponential for an ACDBE—is that margins are shrinking because the cost of doing business is rising,” he says. “I would advise anyone entering the market at this time, or intending to compete for large contracts, to understand we are in a very fluid scenario in our industry. Capital is very expensive, labor is difficult and expensive, food costs are high, construction cost are higher than ever and there is no real dependable data as to when it will subside.” Plummer notes that almost equal to the financing challenge that ACDBEs face is the notion that small companies and really large companies should have parity in deal-terms when their economics and resources are vastly different. “Both are issues that really need to be addressed to ensure a viable future for ACDBEs,” he says. “That said, I think

we will see a lot more consolidation in the space especially for ACDBE companies given the landscape is changing daily. ACDBE companies are positioned for growth, but the economics create a disproportionate amount of risk to an ACDBE entrepreneur when compared to a much larger prime. It will take airports and developers recognizing this reality to effectuate change. I think there will be ACBDE companies that land prime contracts but there will need to be a clear path to debt service and profitability given the economics of an ACDBE versus a large prime.” Plummer adds that he hopes to see more ACDBE entrepreneurs emerge and really go for it. “I hope airports begin to look at concessions contracts like other procurement contracts and consideration for the economics of ACDBE companies are at top of mind when airports are doing concessions planning and writing solicitations,” he says. “I’d like to also see more airports financing ACDBE operators to continue toward a healthy ecosystem.” Patel also affirms that other ACDBEs like OHM can certainly win prime contracts, but it will take a lot of work and patience. “Nothing in our industry happens overnight - it has taken us ten years to get here - but the landscape for ACDBEs look very promising,” he says. “Travel is back, passengers are willing to spend for quality, value and service, and our industry has come back from COVID; however, we cannot go back to the pre-pandemic days. Landlords and tenants are in this together with shared risks and shared rewards. There must be a balanced approach to rents, build out costs and lease terms. It’s the only way ACDBEs can survive and be relevant.” For many ACBDEs, their involvement in the Airport Minority Advisory Council (AMAC), which is focused on creating economic equity, access and wealth for minority- and women-owned businesses, has been an important part of their success. “OHM and Concord Collective in particular are deeply involved with AMAC—Greg Plummer sits on our foundation board and Milan Patel sits on our trade board,” notes Eboni Wimbush, AMAC president and CEO. Wimbush adds that while AMAC is incredibly proud of stories like Plummer’s and Patel’s, there’s still not a lot of real wealth and control that minorities and

women have gained in the industry at large. As Andre Titus, senior manager of programs and operations for AMAC points out, “We need a lot more examples of these folks and this kind of success.” Titus adds that as the industry is moving past the pandemic, the reality is that for a lot of small business owners - and ACDBEs specifically - it’s taking longer to recover, which will shape howACDBEs approach the business moving forward. “I think folks are looking for ways to mitigate risk, and in this space that usually manifests into joint venture partnerships, so I do think we’ll see increased joint venture partnerships for the smaller ACDBE folks in the program,” he says. “And then for the folks that are more experienced and have had some level of success, I think we’ll start to see them land some more prime contracts in the future. As long as these businesses can prove themselves, airports are willing to have ACDBEs participate as primes and on direct subleases.” Wimbush points out that there’s support for AMAC’s core vision from both the federal and local levels, which is encouraging. “At the highest levels right now, we have an administration that has prioritized equity, and they have cascaded that down through the agencies,” she says. “It demonstrates the intention and the focus on ensuring that women and minorities succeed, so I think the future is bright.” Above: Andre Titus, senior manager of programs and operations for the Airport Minority Advisory Council, thinks that looking forward, smaller ACDBEs will mitigate risk by entering into joint venture partnerships, while more established ACDBEs may very well land some big contracts, as long as they can prove their viability to airports.

Above: Eboni Wimbush, president and CEO for the Airport Minority Advisory Council, notes that there’s a great deal of support at the federal and local level for the association’s core vision of creating economic equity, access and wealth for minority- and women-owned businesses, which is encouraging for the future of ACDBEs in the airport space.

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