Downtown duty free stores pip airport stores in Asia-Pacific markets

As the duty free and travel retail community recently met at the Marina Bay Sands Expo & Convention Center, Singapore for their annual regional summit it revealed the determined progress this segment. All the buyers, landlords, agents and distributors, who serve airports, airlines, ferry, cruise and downtown duty free stores all over the region, participated in the TFWA Asia Pacific Exhibition & Conference to discuss the industry trends and doing business with over 260 prestigious exhibiting companies.

It has been evident that in terms of growth, downtown duty free stores delivered the greatest year-on-year sales growth in the region, unlike most other regions where airport stores are the major drivers. Though, as a whole, airports remain the dominant channel, accounting for over half of duty free and travel retail sales worldwide. Of the world's top ten duty free and travel retail locations six are Asian airports: Seoul Incheon, Singapore Changi, Hong Kong, Bangkok, Shanghai Pudong and Beijing Capital.

Provisional figures released by Generation AB show that global duty free and travel retail sales in 2013 reached US$60 billion. The Asia Pacific region accounted for US$22.3 billion, 37 per cent of the total, up 12 per cent on 2012 which was well ahead of the global trend of +7.5 per cent In 1995, when the first TFWA Asia Pacific Exhibition & Conference was staged, the region's share was 30.5 per cent; over the next decade it is forecast to reach 45 per cent.

It was also discussed that, half of the income of airports in the Asia Pacific region is non-aeronautical revenue, of which the lion's share is generated by retail businesses. Airports around the world have recognised the vital contribution that such revenue makes to funding airport development, stimulating traffic growth by keeping landing fees down, and thereby creating employment and supporting both travel and tourism.