May 21, 2020 11:44 PM ET
iCrowd Newswire – May 21, 2020
The global duty free retailing market revenue from 2019 to 2027. The global duty free retailing market accounted for US$ 77.87 Bn in 2018 and is anticipated to grow at a CAGR of 8.44% to reach US$ 155.30 Bn by 2027.
Duty-free retailing offers products to international travelers. Thus is a substantial source of income and Duty-free retailing offers products to international travelers. Thus is a substantial source of income and offers numerous marketing opportunities. The growth of the travel & tourism industry is one of the key factors bolstering the growth of the duty-free retailing market. Duty-free retailing offers temporary spaces that provide extra time to travelers after security check-in and enable them to get indulgent with the ambiance as well as the experience of shopping for international duty-free products.
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The opportunity to purchase the products at a much lesser cost is catalyzing the trend, which is impacting positively on the growth of the duty-free retailing market. Additionally, airlines always lookout for impressive services to enhance passenger flying experience, and onboard shopping and pre-boarding shopping is one of the new services rolled out by airlines, which is, in turn, driving the growth of the duty free retailing market. Furthermore, the airport duty-free retailing facility offers a pre-booking of duty-free products, which allows the customers to choose the product delivery at the airport or on-board. This facility allows passengers to carry less luggage, which further reduces the risk of incurring excess baggage fees.
Duty-free retailing is also a category covered in the ancillary services offered by the airlines. For certain LCCs, the increase in the magnitude and scope of ancillary revenues has become an essential part of their operations. The increase in ancillary revenues helps them to offer economical fare. However, the sales generated from onboard duty-free retailing accounts for the lowest market share.
The market is continuously witnessing a positive growth curve. Duty-free retailers are exempted from individual local and national taxes and duties because they sell goods to international travelers. However, taxes may be imposed on such products once the buyer reaches their country or when the value or quantity of those goods exceeds certain limits. Such retailers operate at international airports, train stations, border towns, seaports, and onboard aircraft and ships. The retailers offer a wide range of product types ranging from perfumes, chocolates, electronics, cosmetics and alcohol to cigarettes, and accessories. One of the primary drivers of the market in these regions is the increasing number of Chinese outbound tourists, who contributed majorly in the global duty-free retail market’s revenue in 2018. Additionally, a consistent increase in the middle-class population in the regions is one of the significant factors contributing to the growth. The demand for duty-free retail shops is anticipated to increase during the forecast period owing to the rising demand for duty-free goods from tourists for avoiding taxes imposed on products that are carried while entering foreign countries. Duty-free and travel retail shops hire multilingual employees to cater to international travelers.
The market players present in duty free retailing market are mainly focusing on product enhancements by implementing advanced technologies. Few of the recent developments are listed below;
2019: Hyundai Department Store Group took over Doosan Corporation’s Doota Duty Free store as part of a KRW61.9bn conditional acquisition.
2020: Casualfood GmbH, an ORIOR Group subsidiary majorly in high-quality food-to-go outlets, and Gebr. Heinemann SE & Co. KG, a multi-generational family-run duty-free retail and distribution company, teamed up in a joint venture called “Smartseller” catering to small and midsized airports in Europe.
2018: The joint collaboration from Aer Rianta International (ARI) and local Indonesian partner Aura Cantik has completed its opening of the perfumes and cosmetics and fashion categories in the Jakarta Duty Free store in Soekarno-Hatta International Airport.
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Keywords: Duty Free Retailing, Duty Free Retailing Market, Duty Free Retailing Market 2020