A Concise Study of Duty-Free Retailing Industry’s Three Major Players in 2022

The tourism industry being considered as an important component of the tertiary sector of the economy, provides services to hundreds of thousands of people around the globe. Moreover, many subsidiary industries such as hotel industry, catering industry, etc. flourish due to tourism sector. One such important subsidiary industry which revolves around the tourism sector is the duty-free retailing industry.

What are Duty-Free Retailing Stores?

Just as any other retail stores, duty-free retailing stores sell different types of products ranging from food and confectionery items, consumer electronics products, tobacco and similar luxury goods, wines and spirits, perfumes and cosmetics, etc. However, the major difference between normal retail stores and duty-free retail stores is that the goods and products sold in duty-free stores are exempted from certain local, regional, or national taxes and duties. However, there’s a catch; the duty-free goods are sold only to travelers who are traveling out of the country and are expected to pay the tax or duty on the product upon arriving at the destination country. This is mainly done so that travelers won’t have to bear the burden of double taxation.

Due to the very nature of duty-free shops, they are generally established at airports, seaports, cruise ships, ferries, etc., i.e., mainly near borders or international waters and operate in highly regulated environments. This is mainly the case to ensure that all the norms of buying from these shops are adhered to. For example, in many of the international airports where duty-free shops are operating, proof of travel is required so as to buy goods and products from the shops.

Top 3 Global Duty-Free Retail Giants in 2022

As per a market analysis report published by Research Dive, the global duty-free retailing market is expected to generate a revenue of around $94,203.7 million by 2031. Naturally, the key players of this industry have a huge role to play in this massive growth. Brief insights on the three leading players of the duty-free retailing market are given below:

1. Dufry

Awarded the world’s leading airport duty-free operator in 2021 by the World Travel Awards, Dufry is one of the largest operators of duty-free retailing stores across the globe. Established and headquartered in Switzerland, Dufry operates in around 65 countries across the globe and have principal retail stores at more than 20 international airports including Melbourne Airport (Australia), Sharjah International Airport (UAE), etc. Recently, the company announced that it had also secured contract to operate in Kempegowda International Airport, Bangalore (India). With many retail brands such as Reg Staer, Hudson, Nuance, etc., working under its umbrella, Dufry’s duty-free stores sell everything from perfumes to tobaccos and chocolates to watches.

2. Gebr Heinemann SE & Co KG

Incorporated in 1903, Gebr Heinemann SE & Co KG is one of the oldest retailers in the industry. The duty-free stores operating under Gebr Heinemann specialize mainly in luxury items, watches, confectionary, wines and spirits, and jewelry products. Based in Hamburg, Germany, Gebr Heinemann, in addition to international airports, also supply products to duty-free retailing stores operating in cruise ships, border shops, ferries, etc. The robust supply chain and logistics management department of this company, has helped it to coordinate and operate at several locations without any hassle.

3. The Shilla Duty Free

A duty-free retailing market giant, the Shilla Duty Free boasts of being the most luxurious duty-free store in Korea and Singapore. One of the 33 subsidiaries of Samsung, the manufacturing conglomerate, the Shilla Duty Free offers travelers with different products from more than 1000 international brands in cosmetics and perfumes, fashion, and jewelry. The company has recently announced its plans to expand its operations by establishing stores in Japan and Thailand.

The Future of the Duty-Free Retailing Industry

Much of the duty-free retail industry’s success depends on the growth of the tourism industry. The Covid-19 pandemic has had a catastrophic impact on the global tourism sector and hence also impacted the duty-free retail market heavily. Hence, in the post-pandemic world, the leading market players are adopting strategies so as to gain an advantage over each other and take a lead in the market. Many companies have introduced select, reserve, and collect services for travelers wherein the customers can look for products online, select and reserve them without any payment, and finally make payment and collect them while leaving the country. Such innovative strategies are once again putting the industry on a growth trajectory.

About the Author(s)

Princy A. J

Princy holds a bachelor’s degree in Civil Engineering from the prestigious Tamil Nadu Dr. M.G.R. University at Chennai, India. After a successful academic record, she pursued her passion for writing. A thorough professional and enthusiastic writer, she enjoys writing on various categories and advancements in the global industries. She plays an instrumental role in writing about current updates, news, blogs, and trends.