JAPAN REPORT: TAKASHIMAYA DUTY FREE SHILLA & ANA
Takashimaya Duty Free Shilla & ANA’s downtown store set to soar in FY2018
A&S Takashimaya Duty Free Co. Ltd, which trades as Takashimaya Duty Free Shilla & ANA, is targeting a three-fold increase in revenue this year at the company’s downtown duty free store in Tokyo’s lively Shinjuku shopping and entertainment district. David Hayes reports.
F
ollowing slower than expected sales during the new store’s first nine months of trading, a
recent increase in Chinese customers has boosted revenue at A&S Takashimaya Duty Free’s downtown stores in Shinjuku. Consequently, this has raised hopes of a strong performance for the current financial year, ending 31 March, 2019 (FY2018). The downtown store is located
on the 11th floor of the Takashimaya Times Square store and currently occupies 2,840sq m of retail space. “It’s been over one year
since we opened in April 2017,” Yoshiyuki Takegahara, Vice President and General Manager of Takashimaya Duty Free Shilla & ANA’s Merchandising Division told TRBusiness. “We haven’t changed anything
major yet, but one big difference is that many Chinese customers now come to our store. Last year very few came, but now we have about 3,500 customers a day, both group tour and FIT customers.” Purchases made by Chinese
customers began to climb during the China National Day 2017 holiday period that began on 1 October. “Chinese Daigou traders started to
come last October and suddenly our sales got higher,” says Takegahara. “Each cosmetics brand has some
limit on item sales and some are selling out of stock, such as SKII.” Free independent travellers (FITs)
mostly Chinese, represent about 75% of Takashimaya Duty Free Shilla & ANA’s total sales. Group tour visitors account for most other purchases. “Chinese trader customers also
go to other downtown duty free stores,” adds Takegahara. “If they do not come to us, our sales are lower.” “They prefer Japanese perfume
and cosmetics; now the new trend is to buy Iqos e-cigarettes.” Perfume and cosmetics is
OCTOBER 2018
Takashimaya Duty Free Shilla & ANA’s best-performing category, accounting for over 50% of total duty free sales. SKII, Shiseido and Kosé are the current top-selling Japanese cosmetics brands. Interestingly, tobacco is the second largest category, representing about 30% of duty free revenue. However, Takegahara notes that
Japanese cosmetics also make up the majority of sales in the downtown store’s tax free zone. “Matsumoto Kyoshi, the famous
Japanese drug store which has a section in our tax free area, is 60% of our shop’s tax free goods sales; and 60% of their sales are Japanese perfume and cosmetics products, such as Shiseido items. “We have lower-priced items
in tax free than in duty free. Also, customers prefer skincare items, not make up. “Electrical items are 12% of our tax
free goods sales – rice cookers and men’s electric shavers are popular.”
Japanese FITs target To assist customers who like to bulk buy, Takashimaya Duty Free Shilla & ANA sells low-priced suitcases, which customers often fill with
additional tax free purchases. Duty free purchases, however, are
delivered to the store’s collection counters in Narita Airport and Haneda Airport’s Tokyo International Air Terminal (TIAT). “We have three hard-sided
suitcase sizes – small, medium and large; all three sizes are the same price, which is about JPY 5,000 ($45),” adds Takegahara. “Usually customers buy the big size suitcase.” Although the number of Chinese
shoppers has increased, efforts are now being made to attract more Japanese customers, which is challenging as the idea of duty free shopping prior to travel has yet to catch on in Japan. “We want more Japanese FIT
customers but it’s not easy because Japanese customers want to buy in airport duty free shops – they don’t
“It’s been over one year since we opened in April 2017. We haven’t changed anything major yet, but one big difference is that many Chinese customers now come to our store.”
Yoshiyuki Takegahara,
Vice President and General Manager, Merchandising Division, Takashimaya Duty Free Shilla & ANA
TRBUSINESS 165
Above: Perfume and cosmetics is Takashimaya Duty Free Shilla & ANA’s best- performing category, accounting for over 50% of total duty free sales.
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