TRBusiness’ February report that the South Korean duty free market was worth an estimated $7.9bn in 2014 has been confirmed by official government figures released in March, pointing to sales of around $7.5bn (excluding airlines).

 

The world’s biggest duty free market is estimated to have increased by 21.6% by the Korean Finance Ministry, although TRBusiness puts this number – based on individual Korean retailers reporting their round sales – at nearer the +27% mark. The average spend per head by foreign tourists was estimated at around $900, compared with just over $750 in 2013.

 

 

6.2M ‘CHINESE TOURIST ENGINE ROOM….’

The Korean Government points to a total of 43 duty free shops generating total sales of KW.8.3 trillion ($7.5bn) last year, up more than KW.1.5 trillion from 2013. [In hard US$ terms, TRBusiness estimated this increase in 2014 at $1.7bn, driven by 6.2m Chinese and 13.6m tourists in total visiting the country – plus South Korean customers-Ed].

 

The government added that downtown duty free shops saw sales up an estimated 32.2% compared to the more modest 5.9% increase reported jointly by shops located at the country’s airports and seaports.

 

TRBusiness is now estimating that this year’s Korean DF&TR market could rise to around $8.7bn, assuming a modest 10% sales increase this year. A 20% increase in sales would put the market within touching distance of $10bn, although there is evidence of discounting in the marketplace at present which could dampen the final value sales increase if it continues.