JAPAN REPORT: JATCO
redesigned Japan Duty Free store. However, Shimizu expects that the quite dramatic shift in product assortment might take repeat customers a while to get used to. “This shop is a challenge for us
as the merchandise is very focused on cosmetics. Previously this shop offered liquor and tobacco and other Japanese products. Now there are no international brands. “Liquor and tobacco – all from
Japanese brands – can be found at the rear of the store. We no longer stock Iqos cigarettes.” The decision not to sell foreign
tobacco products including Iqos in the redesigned shop has, however, had an impact on sales. After reporting double-digit
revenue growth at Narita Airport for financial year ending 31 March, 2019 (FY2018), sales at Narita have slowed this year due to various factors including the T2 central Japan Duty Free shop renovation and stricter customs inspections at airports in China since the start of 2019.
Tokyo 2020 preparations Putting aside the more recent deceleration of growth, Jatco’s Buying and Management Division Manager Ryunosuke Yuki says he is happy with the company’s performance up to March this year. “Our sales were up 12% at Narita
in FY2018 and we are happy with that result. Japanese cosmetics made up 30% of our Narita sales last year… Passengers are buying more Japanese cosmetics including Shiseido, SK-II and other brands. “Tobacco was up 20% last year
and Japanese sake grew by 10 to 15%, but overall liquor sales were flat as there was still a shortage of Japanese whisky.” Chinese passengers accounted for
about 50% of Jatco’s total Narita sales last year, while Japanese travellers’ purchases accounted for around 35% of the total. South Korean and Taiwanese passengers were the big spenders at Jatco’s Narita shops and boutiques. “Japanese customers are looking
for Japanese and international cosmetics and Iqos cigarettes,” Yuki explains to TRBusiness. Jatco operates nine duty free
OCTOBER 2019
outlets in total at Narita Airport. In addition to the recently re-opened T2 central store, Jatco directly operates its T2 satellite Japan Duty Free mixed category shop and its Gucci boutique in T2 Fifth Avenue, along with two mixed category Japan Duty Free shops in Narita T1 North Wing and three luxury boutiques; Chloé, Montblanc and Hermès. Jatco also operates a temporary
shop in the T2 landside shopping area (from 5 September to 5 November) while the 2019 Rugby World Cup tournament takes place. As expected, this temporary unit
will offer a selection of souvenirs, including a collection of official Rugby World Cup 2019 merchandise. Elsewhere in Narita Airport, Jatco also directly operates an airside confectionery shop in T3. Outside of the airport, Jatco’s
stores at Haneda International Airport and in downtown Tokyo are also undergoing improvements ahead of the Olympic Games. At Tokyo’s downtown Haneda
Airport, Jatco will operate the duty free perfume, cosmetics and fashion areas in Tokyo International Air Terminal’s (TIAT) new TIAT Annex, which is currently under construction in the T2 South Wing, slated to open in Q1 2020. Jatco, which is TIAT’s biggest
shareholder, operates TIAT’s duty free shops under a trust contract and has sub-lease contracts with JAL, ANA and NAA for various outlets in
Jatco head office at Haneda International Airport, Tokyo.
Chinese passengers accounted for about 50% of Jatco’s total Narita sales last year while Japanese travellers’ purchases accounted for around 35% of the total.
TRBusiness
TIAT main terminal. Elsewhere in Tokyo, Yuki tells
TRBusiness that renovation work is underway in the Japan Duty Free FaSoLa Mitsukoshi Isetan downtown store in the capital’s premier Ginza shopping, entertainment and business district. Here, Jatco is introducing a
wider range of ‘reasonably priced’ products for the large number of foreign visitors the shop expects to serve in 2020. In addition to recently changing
over several luxury fashion brands, the Japan Duty Free downtown store, in which Jatco is the largest shareholder, will also introduce a new Japanese cosmetics zone that is scheduled to open in October this year. «
Jatco is shaking up its product assortment to include more Japanese beauty brands. TRBUSINESS 149
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