Duty-free shop DFS Group makes strong comeback to airport

DFS Group, which opened its first

duty-free shop at the old Kai Tak airport in the 1960s, is poised for a comeback to the new Hong Kong International Airport after scooping all three individual retail licences opened for tender last month.

The Hong Kong-headquartered duty-free retailer outbid incumbent licence holders Hutchison Whampoa's Nuance-Watson and New World Service's Sky Connection to secure the three individual licences for selling duty-free liquor and tobacco, perfume and cosmetics, and general merchandise at the airport.

The handover of the 38 outlets of the three categories of duty-free goods will start from November - more than 14 years after DFS walked away from selling everything from drinks to cosmetics at the new airport when its concession at Kai Tak ended in July 1998.

"It has always been our hope to have a significant presence at the new airport," said Benjamin Vuchot, DFS Group's Asia north managing director. The airport's high percentage of Asian passengers - the biggest-spending of all travellers - was attractive to all retailers, he added.

Strictly speaking, DFS never deserted the airport business and, until last month's tender, was running 10 outlets in the west hall near boarding gate 60, selling products from watches to sunglasses.

However, the 38 additional licensed outlets it now proposes to open will boost its sales area some tenfold to 78,000 square feet. For the sake of projection, the sales of the 38 outlets topped US$458 million in 2010, followed by a 20 per cent gain in 2011. Meanwhile, the number of passengers visiting the airport just rose 6.6 per cent year on year in 2011.