Lotte Duty Free Guam speaks out about DFS protest
by Jolene Toves
Guam - Lotte Duty Free Guam is speaking out about a protest filed by DFS Guam regarding the airport's highly lucrative retail concessionaire contract. Lotte won the bid over several other potential bidders.
"I am confident that the airport under the guidance of their legal team followed religiously the procurement process under Guam law and I'm confident that the process will be appealed," said Lotte DFS transition director Gerry Perez. He and CEO Steve Park say they respect DFS Group's right to protest the airport board's decision to award the multimillion dollar retail concession contract to their company.
As we reported DFS Group chairman and CEO Philippe Schaus and COO Michael Schriver believe there were "unusual delays" with completing the award process and expressed concerns over the regularity and transparency associated with the process. In a press release, the two said the process took four months longer than anticipated due to several postponements acted by the GIAA on the grounds of procedural issues.
In an interview earlier this week with KUAM News, GIAA executive director Chuck Ada confirmed there were delays early on as a result of concerns about gifts that were given to board members, concerns about a congressional delegate's letter -as far as parity in procurement - and concerns that were raised from the legislature on whether the airport had the ability to engage in a ten-year contract. Ada said those were all concerns for the board during the initial part of the procurement.
Perez, who is a former president of DFS Guam, said he was disappointed with some of the accusations. "I respect DFS an awful lot," he noted. "They are a good, quality company but their president and CEO Michael Shriver in Hong Kong made some statements and allegations that really were quite disappointing to me coming from a company that I respect. His comments basically cast aspersions and impede the integrity of the airport board and the management and evaluation committee the Guam procurement process."
With negotiations now at a standstill, Perez argues the only one benefitting from the delay is DFS, which is holds the current concessionaire contract and remains on a month-to-month contract with GIAA. Perez however says despite the setback, Lotte will move forward in preparation for the transition, assembling a merchant team, operating and logistics team and an information technology team. Perez adds Lotte has ambitious plans to build a "truly world class retail facility" at the airport.
He says they will turn around the declining sales the airport has been experiencing. Their retail concept would make Guam heritage and culture the centerpiece, which would differentiate GIAA from any other airport. "We are very excited actually about the retail concept we brought in because it would completely renovate the airport and the centerpiece of our concept is to intensify a sense of place about Guam," he explained.
Lotte is one of the fastest growing retail companies in Asia with over $65 billion in revenues worldwide. Perez says that Lotte is in the position to generate substantial marketing dollars for Guam.
DFS meanwhile has not responded to KUAM's request for interviews.