LEADING ASIA PACIFIC OPERATORS: INTRODUCTION
Asia Pacific still strides ahead with +15% sales for 9m 2018
Despite the seemingly perpetual cycle of macroeconomic, geopolitical and travel uncertainty punctuating Asia Pacific’s economies, the region continues to outperform others in global duty free and travel retail. Luke Barras-Hill assesses the landscape.
D
F&TR industry stakeholders will no doubt be encouraged by Asia Pacific’s performance
in the nine months of 2018. A 14.7% rise in sales year-on-year outpaces global growth of +9.9% and ‘is more than double the uplift of the next largest region, Europe’, according to TFWA. Indeed, Asia Pacific has
consistently underlined its regional DF&TR dominance in recent years. According to the latest Generation figures available at the time of publication, revenues grew by 12.6% to $30.8bn in full-year 2017, ahead of global growth of +9.5% to $69.3bn.
Project pipeline Slowing growth in China and the residual impact on currencies due to its ongoing trade war with the US poses a sizeable challenge, but there have been some noticeable bright spots. Rising outbound Chinese
travellers and their gradual return to the Korean Peninsula following the cooling of THAAD tensions between both countries has certainly helped, but the region’s travel retail prowess owes as much to its creativity in incubating new developments as any external factors that may have spurred innovation. In the 12 months prior to delegates
attending this month’s TFWA Asia Pacific Exhibition & Conference in Singapore, Asia Pacific has benefitted from a flurry of new airport openings, DF&TR contracts and investments. Gebr. Heinemann (p22) has
expanded its Australasia footprint in the Gold Coast and SM Duty Free and Entas Duty Free have swooped for the first arrivals duty free contracts at Incheon International Airport. In Singapore, DFS Group and The Shilla Duty Free renewed their
MAY 2019
licences at Changi Airport and Taiwanese travel retailer Ever Rich (p56) defended its concession at Taoyuan Airport Terminal 2. Lotte Duty Free (p36) has taken
a substantial step in its overseas expansion efforts, acquiring the JR/ Duty Free business in New Zealand and Australia, while The Shilla Duty Free posted record sales of $5.3bn in 2018, helped by its new Beauty&You operations at Hong Kong International Airport. Market leader Dufry has also been busy, including in cruise lines, which it views as a future investment area. Further downtown duty free store
licences are tipped to be issued by the Korea Customs Service this year. This further liberalisation of the country’s already burgeoning downtown duty free scene is likely to stoke heightened competition between operators, which is good and bad news depending on how it is viewed.
CDFG wins at Daxing Meanwhile, China Duty Free Group (p47) has consolidated its influence at Hong Kong International Airport in partnership with Lagardère Travel Retail and continues to wrap up contracts on the Mainland. CDFG’s entrenched position in
China’s airport market covers Beijing Capital International Terminals 2 and 3; Shanghai Pudong and Hongqiao (CDFG/Sunrise Duty Free); Guangzhou Baiyun Terminals 1 and 2; Macau; and Hong Kong International Airport (CDF-Lagardère) among others. This is not to mention its offshore
presence at the sprawling Haitang Bay, as Hainan Province opens up two further shops in Qionghai and Haikou. CDFG has also confirmed plans to open new downtown locations in Beijing,
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Macau, Shanghai, Dalian, Qingdao and Xiamen. However, all eyes will be on the hotly anticipated opening of Beijing Daxing Airport, where CDFG won a 10-year bid to operate two duty free concessions earlier this year. As ACI Asia-Pacific points out
this issue (p26), big things are expected of Daxing, together with Abu Dhabi’s long-delayed Midfield Terminal Bulding when the two hubs open later this year. At the time of writing, Jewel
Changi Airport had just begun public previews and Singapore will be keen to showcase the retail marvels at the 135,700sq m complex. «
Above: Duty Zero by CDF at Hong Kong International Airport.
Below: Delegates will descend on the Sands Expo and Convention Centre in Singapore this month for TFWA APAC.
Big things are expected of Daxing and Abu Dhabi’s long-delayed Midfield Terminal Building when they open later this year.
TRBusiness
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