Zane Caplansky recently opened two Caplansky’s Deli locations at Pearson International Airport through HMSHost, his first foray into franchising.
Sitting in an airport pub during a five-hour flight delay, Phoebe Fung hit on the idea for her next business. The entrepreneur had already opened Calgary wine bars Vin Room, Vin Room West, and VR Wine, a boutique wine store. "I started thinking, 'I'd love to open a wine bar that provides an oasis for travellers,'" Ms. Fung said.
She started writing a business plan on a napkin. This past October, four years after she first got the idea, Ms. Fung's new wine bar, Vin Room YYC Airport, opened in the new International Terminal at the Calgary International Airport.
For Ms. Fung, opening a business in an airport has had its challenges. "As an independent business, you have to be willing to invest significant time and money into your design and concept before you have a guarantee of a lease agreement," Ms. Fung said.
Security requirements necessitate increased training for staff and make it costlier to bring in supplies. There's also the fact the business must be open seven days a week, 365 days a year. "We've built in redundancy in our operations, because you can't just shut down for repairs," Ms. Fung said.
Despite such obstacles, entrepreneurs such as Ms. Fung are eyeing airports as a way to expand their brands. As frequent travellers themselves, these entrepreneurs are also committed to making airport dining experiences more comfortable and less costly, and that means shying away from the standard of charging more for airport food. Ambarish Chandra, an economics professor at the University of Toronto, says airport food usually costs more for reasons of supply and demand. Airports have a captive audience; once through security, travellers aren't going to turn around. It can also be more expensive for a business to operate in an airport, Prof. Chandra says, because of factors such as security requirements and the airport's location, often on the outskirts of the city, removed from a restaurant's existing network.
"You put those two things together, that restaurants face higher costs and consumers have no choice but to pay, and it's no shock at all that prices are quite a bit higher at airports than outside airports," Prof. Chandra says.
Plus, that captive audience is becoming hungrier. Some airlines now charge for once complimentary food on planes, says Paul Messinger, a professor of marketing at the University of Alberta, creating more need for people to eat at airports. He also notes that consumers who travel by airplane tend to have higher incomes.
For their part, airports, Prof. Chandra says, are becoming more conscious about creating environments where passengers will arrive earlier and stay for longer. "It's in an airport's own interest to attract travellers," he says.
At Vin Room YYC Airport, Ms. Fung plans to keep the food and drink prices competitive with her existing locations. "It does cost more to operate in an airport environment, but we're trying to keep our product as much the same as possible," she says.
Her motivation? "I used to travel a lot, and this is what I would have wanted," Ms. Fung says. In addition to offering over 80 wines by the glass, Vin Room YYC Airport has USB ports and plug-ins, space for luggage, a business centre for last-minute printing jobs, complimentary blankets, and even bar stools with hydraulic lifts to accommodate customers of varying heights. ("I'm 4 foot 10, so this is a nice touch," Ms. Fung says.)
Mohamed Fakih, chief executive officer of Paramount Fine Foods, has opened two locations at Toronto's Pearson International Airport, run by franchise partner HMSHost. Mr. Fakih says chains such as his own, alongside places like Caplansky's Deli, are changing the food and beverage experience for travellers. "I'm a traveller myself, and now I find I can grab something good at the airport," he says.
Despite the fact that staff at the airport locations are unionized and paid higher wages, Mr. Fakih says customers will pay the same price as they do for items sold outside the airport. "We want to maintain the brand and what it stands for, which is great food at a very decent price," Mr. Fakih says.
Both the Greater Toronto Airports Authority and HMSHost are sensitive to such "street pricing," Mr. Fakih says, ensuring that an item available from a Paramount location outside the airport costs the same as within. The airport locations, however, do carry some unique menu items, which are priced by HMSHost.
Zane Caplansky recently opened two Caplansky's Deli locations at Pearson International Airport through HMSHost, his first foray into franchising. Mr. Caplansky says his biggest concern was maintaining the same level of service at the airport location as at his two other Toronto locations. He's had no issues.
"Airports are starting to be more sensitive to the fact that dining is an important part of the travel experience," Mr. Caplansky says. "If they want to be able to compete for the international traveller, having great food options is one way to do that."