An in-depth analysis of key determinants of non-aeronautical Revenue at Banjul International Airport and their impact on total revenue

Over the years, the only source of revenue for airports has been aircraft-related operations. This trend changed when Low-Cost Carriers (LLC) entered the aviation market with a new dimension of business operations. The low-cost carrier business model ensures low operating costs, allowing airlines to charge low fares to passengers and, in turn, provide them with few or no extra services. Airport operators have seen high passenger volume as a positive means of developing business strategies with commercial benefits. This caused airport managers to shift their focus from aeronautics to non-aeronautics services to generate more revenue. This study uses time-series data from 2008 to 2022 to investigate the determinants of non-aeronautical revenue (NAR) at The Gambia's only airport, Banjul International Airport. It tests the correlations/impact of non-aeronautical revenue on total revenue and the impact of the determinants of non-aeronautical revenue on total revenue. The NAR and passenger segment relations by route type and low-cost carriers were also tested. The BIA is state-owned and operated by the Gambia Civil Aviation Authority (GCAA). GCAA is the Authority that handles the aviation industry's regulatory aspects and airport operations. BIA generates most of its revenue through aeronautic services but has a strategic plan to focus more on non-aeronautic revenue, which is manifested through the expansion project. This study uses ordinary least squares to estimate a model of the determinant of NAR, with NAR as the dependent variable. The results will inform the relevant authorities at the airport on which determinant has more influence on NAR and its relations to passengers of different categories.