Dufry Group and Hainan Development Holdings to develop DF opportunities

By Andrew Pentol |

Julián Díaz, Dufry Group, CEO is relishing the opportunity to jointly develop duty free opportunities in the booming Hainan market.

Dufry Group in partnership with Hainan Development Holdings (HDH) has signed a strategic cooperation agreement to develop opportunities in Hainan’s burgeoning travel retail market.

The travel retailer will supply global brands and share its GTR experience with HDH, which is a fully state-owned company of the Hainan Provincial Government.

Initially, the collaboration will focus on HDH’s development of the duty free operation at Hainan’s Mova Mall in Haikou, the capital of Hainan Island.

A major tourism and shopping destination in Hainan Island’s city centre, Mova Mall features shopping, dining and entertainment facilities and over 2,5000 luxury hotels rooms within walking distance.

The Mova Mall complex welcomed 22 million visitors in 2019. Visitors from mainland China can buy duty-free items up to an amount of RMB100,000/US$14,000 per year, following the raising of the allowance on the island in 2020.

PHASED OPENING

Spanning over 38,920sq m across the Mova Mall and Aquarius and Capricorn buildings, the new downtown duty free shop will open in phases. The first of three phases is expected to open before this year’s Chinese Spring Festival.

A new Montblanc boutique opened by Dufry Group at Shanghai Hongqiao International Airport Terminal 2 back in 2018.

Initially, the temporary product assortment in the duty-free store will include an attractive offering covering core categories such as perfume and cosmetics, food and confectionery and wine and spirits. Sunglasses and luxury items from global brands and local premium labels will also feature.

An additional range of luxury and lifestyle brands will be introduced in the second and third phases of development. This will raise the offer to 350 brands across all categories once the store is completed in Q2 and Q3 of 2021.

Julián Díaz, Dufry Group, CEO, commented: “We highly value the common understanding we have reached with our partner Hainan Development Holdings, to jointly develop the duty-free opportunities in the fast-growing Hainan market and beyond.

“Hainan Development Holding’s in-depth understanding of the local market and the duty-free license they hold, combined with Dufry’s global expertise, understanding of customer behaviours and access to all the renowned global brands, represents a unique combination of skills with which to create a successful business in Hainan.

“We are very proud to assist in this duty-free operation at the Mova Hall in Haikou, thus contributing to the successful development of Hainan.”

Dufry commenced its railway operations at Hong Kong’s West Kowloon station on 23 September 2018.

Gu Gang, Secretary of the Party Committee and Chairman of the Hainan Development Holdings, commented: “As the primary investment entity and financing platform for significant projects in Hainan Province, Hainan Development Holdings strives to promote the construction of Hainan Free Trade Port and International Tourism Consumption Centre through the building of tourism, modern services and high-tech industries.

“The establishment of the wholly-owned Global Consumer Boutique (Hainan) Trading Co., Ltd. will further expand the scope of the offshore duty-free business and digital operation models. Global Consumer Boutique (Hainan) Trading Co., Ltd. will keep pace with the international standards of brands, variety and foreign tourists’ duty-free shopping demands.”

Dufry’s partnership with Hainan Development Holdings is in line with its growth strategy in Asia. The alliance builds on the company’s existing and long-standing footprint in China.

The retailer, which has previously expressed a desire to explore offshore duty free opportunities in Hainan and elsewhere in the country, has operated travel retail businesses in China since 2008. It manages duty-paid shops at Shanghai Hongqiao and Chengdu Airports and is also present in Hong Kong and Macau.

 

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