Liquor and tobacco brands will feature in the new stores.

In a landmark move, Japanese travel retailer Fa-So-La Duty Free is set to open arrivals duty free shops at Tokyo Narita International Airport terminals 1,2 and 3.

Currently under construction, two shops – Fa-So-La Arrival Duty Free North and Fa-So-La Arrival Duty Free South – will open in Terminal 2 in early September, with further shops in Terminal 1 and Terminal 3 set to open before the end of the year.

“For Japanese passengers, this will mean they will be able to shop for duty free items on their return to Japan without being burdened with heavy luggage during their travels,” said Narita International Airport Corporation (NAA).

“Visitors to Japan will also be able to enjoy duty free shopping on their arrival for added shopping convenience and enjoyment.”

SMALLER STORE SIZES

The size of the Terminal 1 store is approximately 50sq m, while the other locations measure around 100sq m, a spokesperson at NAA tells TRBusiness.

The reduced sizes of the stores are due to the original design of the arrivals hall layout, which had not factored in the potential introduction of arrivals duty free.

NAA Retailing Corporation will operate the outlets, which will initially stock alcohol and tobacco products from overseas brands, but more categories are set to follow.

“For imported cosmetics and fragrances, NAA Retailing is working closely with related ministries and agencies as well as brand and suppliers – it will take some time to make agreements between all the bodies concerned,” explained the NAA spokesperson.

“We hope to add these products into our lineups upon completion of negotiations. We do not have any plans to carry other product lines such as imported bags and ties, as shop space is limited.”

Two arrivals duty free stores will open in Terminal 2 in September, with further shops in Terminal 1 and Terminal 3 arriving before the end of the year (see below) Source NAA.

WILL OTHER OPERATORS FOLLOW?

As well reported by TRBusiness, Japan has previously considered the introduction of duty free arrivals shops but, until now, any move had been turned down by the government.

One of the fears held by international duty free operators and overseas airports was the threat posed by Japanese arrivals duty free to their businesses, particularly if Japanese travellers avoid purchasing until arriving back in the country.

However last year, the Japanese Transport Ministry was said to be considering the adoption of an arrivals duty free shop model, as part of planned tax system reforms beginning in fiscal 2017.

In 2012, the Finance Ministry produced a study (which included now approved downtown pre-order departure shopping) that looked at the feasibility of arrivals duty free.

At the time of writing, it is not definitively clear whether Japan’s other international airports would follow in suit and introduce arrivals duty free, but it is safe to assume there will be serious interest given previous support from the likes of Kansai, Sendai and Osaka airports.

RETAIL IMPROVEMENTS CONTINUE…

The development continues a wave or retailing activity at NAA, which has also targeted 2018 for the opening of its new airside shops to be located primarily in the Central Building on the third floor of Terminal 1, as reported exclusively by TRBusiness.

Last year, NAA opened four new brand boutiques – Chanel, Prada, Bottega Veneta and a Chanel fragrance & beauty store – after outbound passport control.

The airport is targeting JPY150bn ($1.5bn) in revenue for 2018 in duty, tax free and restaurant sales combined as part of a broader fiscal mid-term management plan dubbed ‘Innovative Narita’ to improve competitiveness among other major Asian airports.

Click here to see previous reports on the arrivals shopping proposals: http://www.trbusiness.com/regional-news/asia-pacific/japan-formally-considers-arrivals-shops/57769