Business Monday

Local airport retail chain NewsLink holds its own against national competitors

Ray Kayal Jr., left, and Chris Korge in a NewsLink store at Miami International Airport. NewsLink Group operates 22 locations in five major airports, some as subsidiaries with partners, or with major retailers under licensing agreements.
Ray Kayal Jr., left, and Chris Korge in a NewsLink store at Miami International Airport. NewsLink Group operates 22 locations in five major airports, some as subsidiaries with partners, or with major retailers under licensing agreements. cmguerrero@miamiherald.com

When Raymond Kayal Jr. was a teenager in the early 1980s, he spent summers working in his family’s airport retail business, stocking shelves in the warehouse or helping customers at stores in Miami International Airport.

Kayal’s grandfather, Mitchell Sirgany, had started opening airport retail shops in 1959, when airport stores bore generic names like “News” or “Restaurant.” Kayal’s father, Raymond Kayal, Sr., also was part of the venture.

At 14, while hoisting warehouse boxes, Kayal Jr. worked alongside family friend, Christopher Korge, 10 years his senior. Over the years, the two stayed in touch, separately went on to college and law school and both worked as attorneys before reuniting to get back into airport retail.

In 2004, they formed NewsLink Group, LLC, now the parent company of retail outlets in Miami, Fort Lauderdale, Boston, New York and Tampa international airports. In 2016, the company had combined revenues of more than $55 million.

The idea to get back into airport retail had been simmering for some time between the two friends, Kayal said.

“Having grown up in and around the business it was always a passion of mine,” Kayal said. “I decided it was a good time for me to shift careers and dedicate myself to trying to build a local Miami-based business that could compete nationally.”

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NewsLink's Ray Kayal Jr., right, who runs a business started by his grandfather, Mitchell Sirgany (in portrait), is shown with his father, Ray Kayal Sr., and business partner, Chris Korge. Courtesy NewsLink

In 2004, the landscape was changing for airport retail, moving away from generic concessions to higher-end, specialty shops and eateries. NewsLink Group put in bids to open shops at Miami International Airport and at Boston’s Logan International Airport. They were accepted at both, and the company opened travel convenience stores, dubbed NewsLink, in each.

Kayal’s family business had operated a variety of retail outlets in airports, from gift shops and restaurants to jewelry and children’s stores, so he wanted to follow suit with NewsLink Group. In 2010, the company ventured into specialty retail in the Miami airport with Coco Bay, a women’s apparel and accessories store.

“It’s one of the best resort-based boutiques that you see on the street,” Kayal said. “Our buyer has done a great job of bringing in a variety of different looks, and that concept has been very well received.”

In 2010, NewsLink Group also partnered with artist Romero Britto to open a Britto store in the Miami airport. The idea was to give travelers a chance to take a piece of Miami back home, Kayal said.

NewsLink Group now operates 22 locations in five major airports, some as subsidiaries with partners, or with major retailers under licensing agreements. Besides the flagship NewsLink stores, Coco Bay and Britto, there are several other concept stores. BookLink is a book store, Privé Gourmet Market offers upscale convenience foods, and Air Essentials is a travel convenience store. The Shoppes at Ocean Drive in the Miami airport is a mini department store, with retailers like a women’s apparel shop, sunglasses retailer and news stand.

In 2015 NewsLink Group got a contract for nine locations in the Tampa airport. Four have been developed; the rest are under construction. The suite of stores will include outposts of NewsLink, Air Essentials and InTune, an electronics store. There also will be a mini department store.

The company also operates Juan Valdez coffee shops in the Miami airport, and at John F. Kennedy International Airport in New York.

“That’s a partnership we have with 560,000 coffee-growing families in Colombia. They have a consortium and they are our partners in developing and operating those Juan Valdez cafes,” Kayal said.

Besides its own brands, the NewsLink Group has license agreements with major retailers like Victoria’s Secret, Dunkin’ Donuts and McAlister’s.

Still, NewsLink group is the proverbial David in competition with a field of Goliaths, Kayal said.

“Our industry is dominated by four or five major international and national companies — each of which has maybe 300 stores in 20 to 30 airports worldwide. They do billions of dollars a year in sales. We are a very small player in our industry, but we are, I believe, the smallest player in our industry who operates on a national platform,” he said.

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Being smaller allows the company the advantage of being more hands-on, Kayal said.

“We’re the first group that passengers to our cities see, and the last group that they see as they leave, so keeping our standards high is No. 1 in everything that we do,” he said.

Company: NewsLink Group, LLC

Owners: Raymond Kayal, Jr., president and CEO; and Christopher Korge, chairman

Launched: 2004

Background: Kayal. 52, went to the University of Pennsylvania and graduated from the Wharton School of Business. He holds a law degree from the University of Miami School of Law. Korge, 62, attended the University of Florida and holds a law degree from Temple School of Law in Philadelphia.

Numbers: System-wide revenues grew from $33 million in 2005 to $55 million in 2016. The company has 22 locations in five major airports, and 11 different brands.

Difference: “Our hands-on personal attention to the business at every level and every detail,” Kayal said. “I can't stress enough how personal this business is to us.”

Clients: International airports in Miami, Fort Lauderdale, Boston, New York and Tampa, and the passengers who fly through them

National competitors: Hudson Group, Paradies Lagardère and HMSHost

Number of employees: About 390 systemwide, 260 of which are in Miami

Corporate office: Administrative office is in Miami, with a connected warehouse and distribution center

Outside view: “They are excellent operators — from store concept development through store operations, they are solid performers,” said Adrian Songer, chief of Aviation Business and Revenue Development for the Miami-Dade Aviation Department. “NewsLink is always focused on customer service … the passenger’s satisfaction is always paramount.”

Worst mistake ever: “A couple of years ago, I thought it would be a good idea for us to start manufacturing some of our core products,” Kayal said. “What we learned was what made more sense was to focus on what we do best … and to leave the manufacturing and the sourcing of products to our vendors.”

Best decision ever: Dedicating several weeks to meet with every Miami employee. “I’ve worked every job in our company,” Kayal said, “but it was nothing like sitting down one-on-one to find out what life was like working at NewsLink, the challenges and what we could do to improve the business.”

Challenges: Maintaining performance levels while adapting to retail industry changes, and growing the business with the limited capital of a company its size, Kayal said.

Growth strategy: “No. 1 for us is to focus on our current operations, our group of employees, and our current airports where we serve,” Kayal said. “We want to make sure we are performing at the highest level possible. That's always my main focus.”

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