Dufry ‘well positioned’ for growth in Americas as recovery gains speed

By Charlotte Turner and Luke Barras-hill |

Gustavo Fagundes, Chief Operating Officer, South America.

Gustavo Fagundes, Chief Operating Officer, South America.

Inside the March/April Americas special edition e-zine, Dufry Group’s leadership tells Luke Barras-Hill that the company’s recovery in the region is gaining speed as US travellers return to Mexico and the Caribbean, while a surge in cruise bookings and trading impetus in Brazil also bodes well for the business this year.

 

Dufry tells TRBusiness it has ‘not wasted a minute’ of the pandemic, launching new store formats, while strengthening its digital offering, particularly in North America, according to Hudson Chief Executive Officer and Chief Operating Officer Jordi Martin-Consuegra.

 

“Working in close partnership with our landlords and business partners and supported by our dedicated team members, Hudson reopened its stores early on [in the pandemic] and has been successfully rebuilding its business and adapting to any new retail trends,” says Martin-Consuegra.

 

Hudson Chief Executive Officer and Chief Operating Officer Jordi Martin-Consuegra.

Hudson Chief Executive Officer and Chief Operating Officer Jordi Martin-Consuegra.

“We have not wasted a minute of the pandemic and have launched new store formats, grown an expansive brand portfolio and strengthened our digital offerings, ultimately further solidifying our position as a leading one-stop-shop travel retailer in North America.”

 

‘GOOD EVOLUTION’ IN MEXICO AND THE CARIBBEAN

In South America, Dufry possesses a dominant market share in the airport arrivals and departures duty free plus landside and airside duty paid segments.

 

“Travel retail in Mexico and the Caribbean has shown good evolution during the pandemic due to the positive impact of the US passengers, who are the main customer for these markets,” reports Juan-Antonio Nieto, Chief Operating Officer, Central America & Caribbean.

 

“We are expecting that this trend will continue through 2022. This leadership position has increased during the pandemic.

 

“At the same time Dufry operates on cruise ships in this part of the world in partnership with NCL and Carnival Group.”

 

Dufry continues to eye growth opportunities to enhance its footprint and shops portfolio across the Americas

Dufry continues to eye growth opportunities to enhance its footprint and shops portfolio across the Americas.

 

CRUISELINES REBOUND

Cruiselines have been hit with a volley of restrictions in the past two years, but a staggered revival of in-demand itineraries last summer have been enticing cruise and ferry shoppers back onboard.

 

Juan-Antonio Nieto, Chief Operating Officer, Central America & Caribbean.

Juan-Antonio Nieto, Chief Operating Officer, Central America & Caribbean.

“Clearly, the cruise business has shown a slower rate of recovery, but we are now seeing much more positive signs in this sector with operators reporting a surge of bookings for 2022 and 2023,” continues Nieto. “The propensity to travel is still very much there – across all sectors not just cruise ships – and as soon as people are able to travel, they are wanting to go ahead and do so.”

 

In the US, where Dufry operates its cruise operations out of Miami, a Centers for Disease Control and Prevention (CDC) voluntary cruise ship programme received support from cruiselines in late February after the agency relaxed guidelines around isolation, quarantine and testing.

 

While much of Central and Latin America has now reopened to international travel, a patchwork of different border controls remain in place against the backdrop of new Covid variants, creeping inflation and political upheaval due to elections in several countries this year (Brazil, Colombia and Costa Rica).

 

BRAZIL UPDATES

In Brazil, Dufry secured two new concession contracts to operate duty free and duty paid units at Salgado Filho International Airport in Porto Alegre last year and renewed ties with AENA-managed Recife Guararapes – Gilberto Freyre International Airport in February 2022.

 

“The levels of domestic travel in Brazil are usually high relative to international travel,” comments Gustavo Fagundes, Chief Operating Officer, South America. “This domestic passenger flow has helped sustain/drive the duty paid share of our total business, thereby helping to mitigate recent external impacts on our duty free business, such as the slow down in international travel whilst pandemic travel restrictions were in place.

In 2019, Dufry opened a land border store on the Brazilian side at Uruguaiana in Rio Grande do Sul, now home to a crop of other shops after a law change in 2018

In 2019, Dufry opened a land border store on the Brazilian side at Uruguaiana in Rio Grande do Sul, now home to a crop of other shops after a law change in 2018.

“The domestic passenger flow and the duty paid travel retail outcome are back to the 2019 level, showing that Brazilians are retaining their motivation to travel and purchase in travel retail shops.”

 

On plans for expansion across the Americas, Dufry says it continues to evolve its diversification strategy including assessing organic growth and other opportunities that can ‘strategically enhance our footprint and shop portfolio’.

 

Read the full length article in the March/April e-zine here.

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