International travel restrictions have proven catastrophic for the travel retail and duty free sector, an important route to market for many luxury beauty and fragrance labels. With vaccine news spurring airline stock rebounds, Cosmetics Business explores what regions and strategies will be the most lucrative as travel retail gets back on the runway
It is fair to say the impact of Covid-19 on international travel and important retail routes for the duty free sector – such as airport boutiques and the cruise industry – has been crushing.
Basel-based Dufry, the world’s biggest duty free company, operating across 65 countries and incorporating retail brands including World Duty Free and North America’s Hudson, saw 2020 first half net sales of just CHF1.5bn, compared with nearly CHF4.1bn in the same period of 2019.
It has been much the same story for airports with London Heathrow Airport (which has a duty free contract with World Duty Free) documenting a 63% dip in retail revenue even before the UK slid back into its second national lockdown in November.
“The pandemic has had a catastrophic effect on international travel and consequently on duty free and travel retail sales,” Sarah Branquinho, President of the global industry association Duty Free World Council, observes. “The impact has been global and across all sectors, aviation and maritime.”...
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