Airport Experience® News - Retail Issue 2026

DIRECTOR’S CHAIR

operator]. No one entity could have more than six locations. There are only three of those locations yet to open. Bambuza will have locations in both A and B, and the last concept to open will be a local entity called Midtown Spirits. Everything will open before Thanksgiving. [The F&B program refresh] started last September [2025], and [will be completed in] November of this year. We’ve seen the spending rates increase from passengers, from about $8.17 per enplaned passenger now to $9.74, for F&B only. WARD: Next up is retail, correct? NICHOL: Yes, we’ll be putting out an RFP for retail, but also for food and beverage for the extension of the concourse. We’re still working out what exactly that program will look like. WARD: Do you know the timing yet? NICHOL: I don’t know the specific timing. I think the retail will come within the next year. I don’t know yet if we’ll do the food and beverage for the extension of B at the same time. WARD: Do you feel like you’re right sized on concessions. NICHOL: I think we’re still undersized – that’s what my staff are telling me. WARD: Major concessionaires have been sounding the alarm in recent years about the unsustainability of current approaches to airport concessions, calling out minimum annual guarantees (MAGs), pricing policies, build out costs and other issues. Have you changed the approach for SMF? NICHOL: The big drumbeat had been about MAGs. [We] did analysis of MAGs and identified that they only made a difference a tiny percentage of the time. We put out these new [F&B] RFPs with no MAG. I never heard from anyone. None of the people who used to complain to me said thank you. Nobody said ‘hey, we appreciate you looking out for us.’ Right: Over the past year, SMF has overhauled its entire food and beverage program, bringing in fresh concepts from multiple operators. Pictured are opening events for Bar New Helvetia, operated by HMSHost in partnership with local concept New Helvetia Brewing; and Local Flights Brews and Bites, owned by Sacramento-area small business operators Edwin Balli and Andrea Ayala.

As you know, we don’t control labor costs, and our county is not into trying to dictate what people pay. But we did provide an interesting approach to pricing for operators. They could choose between charging street plus 15% and fair market pricing. With fair market pricing, they can offer high-end offerings, but they have to balance it out with lower end prices [on some items], within the same location.

WARD: What was the verdict? NICHOL: Most are doing the street plus 15%. I think it’s easier - people are used to it. One thing we looked at, in particular for the pre-security concession, is the operator model, where the airport provides the infrastructure and the operator simply operates the restaurant for the airport. There’s much more airport control. We just didn’t have the staff to do it but it’s something we’ll keep in mind.

14

AX NEWS SEPTEMBER 2026