Airport Experience® News - Food & Beverage Issue 2025

“While pouring rights may help airports fund operations, rigid execution negatively affects concession sales, customer experience and ultimately concession fees,” Bisset continues. “In essence, it shifts financial upside from concessionaires to airports. Over time, this leads to reduced rent volumes and lower percentage rent concession fees in future RFPs.” ARRA’s Weddig points out that the transaction in a pouring rights deal excludes the concessionaire while also requiring that the concessionaire pay for it. “No matter what the beverage company might say, the concessions operator effectively funds any payments to the airport,” he says. “The negative effect of these types of deals is significant. I’ve seen data showing unit cost increases ranging from 30 percent to 70 percent and unit sales falling 15 percent – a bad combination.” SSP America’s Schaefer brings attention to “a few of the many negative results of these contracts,” including contractual conflicts arising from operators being required to do separate, one-off airport deals rather than cohesive, continent-wide partnerships; lost business value due to these deals eroding margins and limiting the operator’s ability to invest in other areas of the business like frontline staff, guest experience and innovation; higher prices on beverages and reduced options for travelers; and operational disruptions due to menus needing to be rewritten, staff needing to be retrained and inventory needing to be overhauled. Bisset notes that pouring rights agreements could potentially be made more beneficial for concessionaires if concessionaires themselves are engaged early in the process. “We bring significant expertise to these negotiations,” he says. “Flexibility in product selection, promotional allowances, financial rebates, brand marketing support and pricing structures is critical to ensuring commercial viability. “Without meaningful operational or financial offsets, the most advantageous outcome for concessionaires remains the avoidance of rigid, exclusive agreements,” Bisset adds. Weddig asserts that pouring rights deals as they stand today are “simply bad” for concessionaires.

“They are especially egregious if put in place during the term of a contract – the financial impact is devastating,” he says. “Even if during the RFP an airport reserves the right to enter into a pouring rights deal, the uncertainty of timing and financial terms makes it difficult to submit a responsible proposal. Uncertainty during the RFP simply ends up hurting the airport as proposers seek to reduce their risk. Certainty during the RFP – that is, a defined pouring rights agreement is in place – is no better for an airport as proposers seek to recover known higher costs through reduced financial proposals. At the end of the day, pouring rights deals may provide a perceived financial benefit to an airport, but it will be short-lived as sales and rents eventually decline.” Despite these concerns, more airports seem to be getting on board with at least considering pouring rights agreements. “Nearly 20 percent of the top 40 U.S. airports already have these kinds of partnerships in place, with dozens of others having adopted pouring rights language into their tender agreements,” says Neisen. “We expect the number of airports with pouring rights only to climb as the benefits become more widely understood. It’s an approach that works, and when it’s done right it works for everyone: the airport, the operators, the brand partners and, most importantly, the passengers.” But given their own experiences with these contracts, concessionaires feel strongly that anything that puts constraints on their ability to do business does more harm than good, especially in today’s unpredictable landscape. “Just when we thought we were finally turning the corner from the disruptions of Covid-19, we’re now staring down a new wave of global economic uncertainty that’s putting renewed pressure on an industry that’s only just begun to recover,” Schaefer says. “For companies like ours that operate on tight margins and invest heavily in people and infrastructure, these are not abstract challenges – they’re real and immediate. Now is not the time to add more pressure through policies or agreements that compromise our ability to serve passengers and support airport communities. What we need right now is stability, partnership and a shared focus on long-term recovery.”

Above: David Bisset, chief development officer for Paradies Lagardère, notes that while pouring rights agreements may be lucrative for airports, they negatively affect concession sales, customer experience and ultimately concession fees.

For Concessionaires, It’s More Complicated Neisen asserts that pouring rights agreements are also beneficial to concessionaires. “One of the most immediate benefits of these programs is that they help reduce operating costs for concessionaires – particularly for small, local or ACDBE partners – by giving them access to national pricing, equipment and marketing support that they wouldn’t receive independently,” she says. “That cost relief can be a game-changer, especially in high-overhead environments like airports. But it’s not just about lowering costs, it’s also about growing sales. A coordinated beverage program that includes marketing, merchandising and activation support can boost beverage revenue significantly.” But for many concessionaires, this hasn’t been the case. “At a major Northeastern airport in 2018, a strict pouring rights agreement resulted in an 18 percent decline in beverage revenues,” says David Bisset, chief development officer for Paradies Lagardère . “Energy drink sales dropped by 70 percent, sparkling water by 64 percent and carbonated soft drinks by 7.5 percent, clearly demonstrating the financial damage caused when customer preferred products and brands are removed from the offering.”

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AX NEWS JULY/AUGUST 2025