Dubai Duty Free (DDF) has recommenced trading at Dubai International Airport (DXB) Concourse B West today (3 June) in the first phase of a staggered revival programme.

As revealed by TRBusiness yesterday (2 June), DDF was awaiting approval to restart operations after an inspection conducted the same day by the Dubai Civil Aviation Authority.

DDF had submitted proposals to relevant authorities concerning the safe re-opening of shops shortly after the Eid holiday period in May.

The timely update today means passengers will be able to purchase from electronics, perfumes & cosmetics, liquor, pharmacy and food shops at Concourse B West under a phase one plan.

These will be followed as soon as possible by phase two shop re-openings at T3 Arrivals 4, T3 Landside, T2 Departures and T2 Arrivals.

A third stage will take in Concourse B East – home to lucrative gold, cosmetics, L&T and perfumes units, plus boutiques such as Chanel and Gucci – Concourse C, Concourse D and the T3 Arrivals Unit 3. Aside from at Concourse B West, other DDF shops remain closed.

Sharing the developments during TRBusiness’ second TRConnect webinar, DDF Chief Operating Officer Ramesh Cidambi said plans to re-open Concourse A and Al Maktoum International Airport are yet to be decided.

FULL-YEAR ‘LOW FORECAST’ AROUND $600m

DDF currently operates around 180 shops over more than 40,000sqm of retail space across Dubai International and Al Maktoum International Airports.

In the case of the former, there is the possibility it might not open this year and the latter is unlikely to open until the latter stages of 2020, remarked Cidambi.

In an insightful presentation, he took the opportunity to highlight the retail outlook for the coming months and shed important light on some of the steps the travel retailer is taking to mitigate against the damage caused by the coronavirus (Covid-19).

“We experienced the first effects of the Covid crisis towards the end of January; in the beginning, we thought it would be about a $100 million hit to our business and then we realised the seriousness of the problem,” said Cidambi.

“By the beginning of March, we thought it was a $300m-$400m hit, then our shops finally stopped operating on the 25^th March.”

Given the significant geographical spread of DDF’s customer base, the balance of sales between major source markets such as Europe, the Far East, the Middle East and Indian subcontinent was fairly evenly distributed in the three months until the travel retailer’s shops shut on 25 March.

He revealed that as of 2 June, sales are 52% down year-on-year. Around $400m worth of business has been done to date.

For the remainder of the year, DDF estimates that turnover will increase by a further $200m-$300m on the $400m already accrued – dependent on passenger levels [DDF recorded turnover of $2.029 billion in 2019 – Ed].

“For a low forecast, we think we will finish the year with about $600m and in terms of a higher forecast, about $800m-$900m,” said Cidambi. “But a lot of this depends on the blocks to people travelling easily.”

SAFEGUARDS IN PLACE

Since the end of March, DDF has been thinking carefully about life after Covid-19 and has responded by putting in place measures to ensure the safety of its customers, and staff – from back office to front-of-house operations.

This also includes protecting DDF and airport staff from the virus’s transmission; reassuring staff and customers that preventative measures in line with UAE federal guidelines are in place; and ensuring the shopping environment is safe, comfortable and convenient.

Among the measures implemented are in-store modifications covering access control, flow management and customer hygiene, and operational adjustments with regards to stock replenishment, queue regulation and the promotion of a concierge shopping service, among other things.

 

“As an organisation, we are confident about our financial ability,” added Cidambi. “We have a strong balance sheet, we are not leveraged and can meet whatever commitments are ahead of us. I am very confident about the future; from a traffic perspective, what will be will be.”

Stay close to TRBusiness.com for a detailed report from the second TRConnect webinar, featuring further comments from Cidambi.