While Basel-based retail giant Dufry once again breezed past the competition to retain the top spot in 2018, it was the Asian retailers who continued to dominate the narrative in the 21st Top 10 International Operators Report*.

 

It is no secret that the no 1 global travel retailer has experienced a moderation in growth within the last two years, following consecutive years of industry-changing acquisitions – namely Nuance and WDF – due in part to the challenging trading conditions in South America where volatility in the marketplace has led to a drop in sales across the region.

 

Despite other ‘complexities’ [read the Top 10 Operators Report for more details], Dufry still had two very positive developments to report this year in Russia and Brazil. Known for its bullish approach to expansion through M&As, Dufry did not surprise many in the industry when it announced intentions to increase its stake in RegStaer Vnukovo from 51% (in 2012) to 60%, earlier this year.

 

However, with half of the world’s leading operators now originating or head-quartered in Asia (although DFS is a subsidiary of luxury goods group LVMH, its HQ is actually based in Hong Kong), it is clear to see where the industry’s growth continues to derive from.

 

The most remarkable performances in 2018 were registered by Lotte (No 2) +28.9%; Shilla (No 3), +32.5% and most impressive of all was China Duty Free Group (No 4), +126%, which shot up four places in this year’s table from eighth last year.

 

CLEAR INTENT FOR CRUISE OPPORTUNITIES

In another observation made by TRBusiness, a number of the world’s leading operators are talking more openly about the importance of the cruise channel to their growth strategies. Dufry, Heinemann and CDFG have all made noises to this affect.

 

CDFG, for example, made its intentions very clear following its win of the duty free contract on Costa Cruises’ Costa Atlantica vessel following a ‘fiercely competitive tender’.

 

Sixth-placed Gebr. Heinemann has also been busy at sea in the last year, penning a fleet-wide deal covering Tui Cruises’ Mein Schiff vessels until 2026 having also won the concession to run retail on Mein Schiff 4.

 

The ferries & cruise business currently represents 3% of Heinemann’s total group revenue.

 

While the ferries & cruise ship business clearly holds fantastic growth potential for the Hamburg-based retailer, the core of its operations – and focus – lie in the airport duty free sector, where it also has big ambitions.

 

GAME-CHANGING TENDER

One of these includes the new duty free liquor & tobacco contract at Singapore Changi Airport.

 

At press time, Heinemann and Korean rivals Lotte and Shilla had lodged bids to contest the re-tendered liquor and tobacco contract at Singapore Changi Airport due to be vacated by long-time incumbent DFS Group.

 

Launched in June, the 18-store six-year concession covers 8,000sq m of retail space across all four terminals.

 

Having originally been expected to participate in a new tender, in the hope perhaps of securing more favourable terms, DFS (No 7 in our table) will now no longer operate at another key Asian hub (it exited its L&T contract and lost out to Shilla for P&C at HKIA two years ago).

 

*The 21st Top 10 International DF&TR Operators report – including all subscriber-only content – can be picked up with the October issue of TRBusiness at the TFWA World Exhibition in Cannes (30 September-04 October).