The Japanese duty free market grew by 20% to a new record high of JPY280bn ($2.5bn) in FY2015 (ending March 2016) but there is also much concern amongst operators that Chinese government increases in luxury goods import duties have already hit sales badly in HY1 FY2016 – along with the strengthening yen.

 

According to a major exclusive report in TRBusiness’ October 2016 edition this month, this has hurt several operators, although the aforementioned $2.5bn sales total in 2015 does not include downtown duty free shopping in Okinawa, or sales onboard Japanese airlines.

 

 

In fact, Japan’s three leading airports of Narita, Kansai and Tokyo downtown Haneda are understood to have accounted for nearly 80% of all Japanese duty free and tax free airport shop sales in FY2015.

 

The remainder was accounted for by Japan’s smaller regional airports, many of which have seen international passenger numbers grow strongly recently, as flight routes to more cities in China increase.

 

Less well known are the sales that are also made by small operations located in Japanese seaports, including passenger ferry services to South Korea, plus onboard the growing number of cruise ships from China that now increasingly call at Japanese ports.

 

 

Breaking the sales down by major airport, it is estimated that duty free and tax free sales airside and landside combined totalled about JPY105bn in FY2015 at Tokyo Narita, with revenue up 15%, while tax free sales rose by 29%.

 

The recently privatised Kansai International Airport, serving Osaka, Kyoto and Kansai recorded 8m international departing passengers in 2015, up 27% over the previous year, while duty free and tax free airside and landside sales totalled about JPY85bn in FY2015.

 

 

Japan’s third largest airport at Tokyo’s International Air Terminal (TIAT) in Haneda handled a total of 6.3m international departing passengers in 2015 – some 19% over the previous year.

 

TIAT’s direct airside duty free and tax free sales combined amounted to around JPY42bn in FY2015, while growing by an impressive 31% overall last year. Rising Asian visitor numbers also boosted overall passenger traffic at Japan’s other leading airports last year.

 

[In-depth and exclusive interviews with all of Japan’s major duty and tax free operators were conducted recently in Japan and a major review of the market and the performance of its operators appears in the October edition of TRBusiness magazine-Ed].