In addition to the projects already disclosed in Kazakhstan, Bali, Sri Lanka, and Taiwan, Dufry now reveals that it is to embark on new projects in South Korea and China.

 

Dufry has signed a new contract in South Korea – where it will operate duty free shops at Busan International Airport – as well as in China, at Beijing Capital Airport and at Shenzhen Bao’an International Airport with Shenzhen Duty Free.

 

Including these latest contract wins, Dufry will have a presence in 14 locations in Eurasia and Asia and the new projects will contribute a combined turnover around CHF 250m per annum.

 

“Dufry considers Eurasia and Asia as one of the regions for strategic development for the Group based on its strategy of growth in emerging markets and tourist destinations,” says the group.

 

NEW PROJECTS WORTH CHF250M

“All new projects combined are expected to contribute around CHF 250m of turnover and, including Dufry’s existing business, operations in Eurasia and Asia will contribute more than 10% to Dufry’s turnover, with a strong focus on Greater China and South East Asia.” The retailer says that the increased local presence will allow Dufry to showcase its expertise to airport operators and suppliers alike in the region.

 

Dufry Thomas Julie Korea Co. Ltd (DTJ) – a partnership between Dufry and the South Korean firm Thomas Julie & Co. DTJ – won a bid to operate a duty free shop at the Busan Gimhae International Airport for five years.

 

DTJ will be the duty free retailer at Busan Airport in most core categories such as wine & spirits, confectionery, fashion & accessories, watches & jewelley, tobacco, electronics and souvenirs.

 

“A special attention will be on the introduction of an attractive mix of Korean products, showcasing the best of Korea’s heritage and culture to all departing passengers, bringing the operation a perfect sense of place,” says Dufry.

 

MAJOR RETAIL UPGRADE

The shop is expected to start operations in the first quarter 2014 with 434 sqm and will be expanded in 2015 as part of the airport’s retail upgrade. Thomas Julie & Co is a Korean company engaged in the supply of Korean products to duty free companies within Korea.

 

Busan Airport handled 4m international passengers in 2012, representing a 20% growth over 2011, driven largely by tourism traffic from China.

 

Among the main destinations are Japan and China, and to a lesser extent neighbouring countries as the Philippines, Thailand, Hong Kong and Vietnam. Located Southeast in the Korean peninsula, Busan is the second largest city in South Korea after Seoul.

 

And earlier this month, Dufry and Beijng Capital Airport Commercial and Trading Co. Ltd. (ACT) signed an agreement to operate duty paid shops at Beijing Capital International Airport (BCIA) for up to five years.

 

[Left: Part of the commercial offer at Beijing Airport]

 

1,000SQ M OF RETAIL SPACE AT BEIJING AIRPORT

Located in the new terminal 3D, the operations will comprise nine shops and cover nearly 1,000s qm of retail space and are expected to open progressively in the next nine months.

 

Dufry will unveil a series of fashion & accessories and luggage shops, with brands like Tommy Hilfiger, Armani Jeans and Furla as well as perfumes & cosmetics shops with brands including Kiehls, Shiseido and Clarins.

 

This new project comes as part of ACT’s plans to redevelop the commercial offer at BCIA. “The airport is the busiest in China and among the top five airports in Asia, handling 82 million passengers in 2012, of which 32 million domestic passengers were equally distributed between terminals 3 and 2, with a smaller number in terminal 1,” adds Dufry.

 

To cater to the increasing number of passengers, Terminal 3D was opened earlier in 2013 to handle some of the traffic within Terminal 3.

 

DUFRY AND SHENZHEN DUTY FREE

Dufry also has entered into a partnership with Shenzhen State Owned Duty Free Commodity (Group) Co. Ltd (Shenzhen Duty Free) for the provision of supply and management consultancy services at the new international terminal of Shenzhen Bao’an International Airport.

 

Dufry will work together with the partner to develop the retail concepts and supply core categories such as perfumes & cosmetics, food & confectionery as well as fashion, accessories, watches & jewellery. The operations at the new terminal are scheduled to open progressively from November 2013.

 

Shenzhen Duty Free is the sole duty free operator at Shenzhen Airport, and is also a major operator of border shops between Shenzhen and Hong Kong. Shenzhen Airport received nearly 30m passengers in 2012.

 

Julian Diaz, Chief Executive Officer, [pictured below] of Dufry said: “We are very pleased with the results achieved in the recent bidding processes in Asia.

 

ATTRACTIVE RETAIL MIX IN SOUTH KOREA

“They are a milestone in the execution of Dufry´s strategy, which is based on emerging markets and touristic destinations. With these new projects, we have created a sizeable platform to even further strengthen our position in that region.

 

“With the above mentioned achievements, Dufry will operate in 14 locations, 140 shops, in the Far East, Middle East and Central Asia, bringing the total number of countries in our global portfolio to 49. All together, Dufry will add around 14,000 new square metres and expects to have a contribution of around CHF 250 million per year to our revenues once all the projects are fully operational.”

 

Diaz says that the new contract, to run duty free operation in South Korea, represents a major step for Dufry to ‘enter the single largest duty free market in the world’.

 

“The partnership with Thomas Julie & Co will bring a strong Korean partner for the Busan Airport operation, with an attractive representation of Korean products as part of retail mix,” adds Diaz.

 

As ‘the largest foreign travel retailer in China’, Dufry says it is well placed to work with DTJ to cater for the fast growing number of Chinese passengers going through the airport.

 

The signing of the two new agreements in Beijing and Shenzhen are a continuation of Dufry’s strategy in China. “By partnering with ACT we are set to bring the highest standards of travel retailing to Beijing Capital International Airport,” says Diaz. “Equally important, our cooperation with Shenzhen Duty Free will be our second duty free operation in Greater China, and will mark Dufry’s entry into the duty free market in mainland China.”

 

“With the new projects in South Korea and China, we have now a solid and diversified footprint in some key markets of the region and this will allow us to explore further opportunities. From a group perspective, all the new projects are yet another step in the diversification of our business and the strategic positioning in attractive markets.”