LEADING ASPAC OPERATORS: CHINA NATIONAL SERVICE CORPORATION
“As the situation continues to improve in China, we are confident of generating medium and long-term sustainable growth.”
Evita Qu, CNSC
duty free products through various channels such as airport duty free shops and offshore duty free. “Due to the recent pandemic,
the purchase of duty free products from traditional channels has been restricted to an extent. “CNSC was the earliest to meet
Right: CNSC still plans to open its new downtown duty free store in Beijing later this year.
tests and enter a quarantine period of 14 days. Those entering from Beijing
Capital International Airport must take Polymerase Chain Reaction tests and also enter quarantine for two weeks. Qu remarks: “China’s control of
the Covid-19 situation is constantly improving and Wuhan, the hardest hit city in the country is getting back on track.” The global spread of the pandemic
and its impact on the world economy, however, is not lost on Qu, who suggests DF&TR is one of the hardest hit industries. “At market level, consumer confidence has declined and the number of inbound and outbound travellers has decreased globally since February. “Although the situation has
been basically brought under control in China, the impact of imported cases on the whole duty free industry is expected to remain in the short-term.” CNSC’s downtown duty free
business has not suffered too much commercially, suggests Qu, who believes downtown duty free stores are a relatively unique DF&TR format and remain an attractive proposition for loyal customers. “Previously, people could buy
the consumption needs of these consumers, which is why our stores in Shanghai and Dalian have demonstrated positive sales momentum.” Covid-19 has not only impacted
travel retailers such as CNSC to varying extents, but also affected the brands as well.
Strong brand communication “During the crisis, we strengthened our communication with brands and received marketing support from many of them including The Estée Lauder Companies, L’Oréal Group, AmorePacific, Kosé Group and Clarins Group. “They all assisted us with elements
such as brand giveaways and online training and were instrumental in reducing the impact of the pandemic.” Qu says the ‘flexible’ business
model operated by China’s duty free stores will ensure the country’s DF&TR industry is the first to completely recover: “Our customer base is more focused on the domestic market, which is quite different from port stores, for example, which rely solely on a fixed passenger flow. “As the situation continues to
improve in China, we are confident of generating medium and long-term sustainable growth.”
The company will also look to
capitalise on the development of China’s duty free industry, which is supported by a new government policy. The policy was jointly issued
recently by 23 ministries and departments,
including the
National Development and Reform Commission, Ministry of Industry and Information Technology and Ministry of Commerce. Qu comments: “For the first
time in history, a duty free system is being proposed with Chinese characteristics. This includes the building of several downtown duty free stores, also complete with Chinese traits. “The proposal is good news for
CNSC, which will directly promote its future development on a larger scale.” Offering further thoughts on
the future outlook of the Chinese duty free market, Qu highlights the great potential of the country’s duty free industry. In a message of support and
positivity to the company’s supply partners, she also suggests the Covid-19 pandemic will not last much longer. “With the gradual stabilisation of
the pandemic, I believe the consumer market will gradually re-activate and that the travel retail industry will recover quickly.” She concludes: “I would like to
take advantage of the TRBusiness platform to thank our partners for their continued help and support. “If any of our overseas partners are
Over in Hangzhou, the duty free store is advertising through WeChat Moments, a function of the WeChat smartphone app, to raise awareness.
44 TRBUSINESS
in need, they must contact us as soon as possible. We will do everything we can to help them out.” «
MAY 2020
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