Duty Free Retailing Market Growth Accelerated by Continued Growth of the Travel Retailing Industry

 

Duty free retailing refer to the sale of goods to travellers without payment of certain local or national taxes and duties. Duty free goods are sold in travel retail stores that are located within secure zones such as airports and ships. Common duty free products include perfumery and cosmetic products, wine and spirits, tobacco goods and fashion accessories. The global travel retail industry has witnessed increased air passenger traffic in recent years, thereby fuelling demand for duty free goods. With rising disposable incomes and globalization, international travel is gaining prominence which is expected to drive further growth of the travel retailing sector.

The global Duty Free Retailing Market is estimated to be valued at US$ 38.95 Bn in 2023 and is expected to exhibit a CAGR of 8.6% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

The continued growth of the global travel retail industry remains the key growth driver for the duty free retailing market over the forecast period. Rapid urbanization and growing middle class population coupled with rising disposable incomes in developing regions is boosting international travel. Further, low cost carriers have made international travel more affordable which is positively impacting the travel retail sector. According to the International Air Transport Association (IATA), the global passenger traffic is expected to double in the next 20 years. This rise in global air traffic presents lucrative opportunities for duty free retailers operating at airports. The growth of cruise tourism is another major trend that is fueling demand for duty free goods sold on ships.

Segment Analysis

The global duty free retailing market is dominated by airports segment which accounts for over 70% of the total market share. Airports hold a strategic position for duty free shopping as it allows a captive audience who can avail exclusive offers while waiting for their flights. The airports segment witnesses high footfall and substantial time for customers to shop during transit. Certain airports also provide exclusive brands and products to attract customers.

Key Takeaways

The global duty free retailing market is expected to witness high growth over the forecast period of 2023 to 2030 supported by recovery in air passenger traffic post pandemic.

The Asia Pacific region dominated the market in 2024 with a share of over 35% owing to strong growth in duty free shopping from Chinese outbound travelers. Key players operating in the duty free retailing market include Dufry AG, LOTTE Duty Free Company, DFS Group Limited, Gebr. Heinemann SE & Co. KG, The Shilla Duty Free, The King Power International Group, James Richardson Corporation Pty Ltd., Duty Free Americas, Inc., Flemingo International Ltd., Dubai Duty Free, and China Duty Free Group Co., Ltd.

Key players operating in the duty free retailing market are Dufry AG, LOTTE Duty Free Company, DFS Group Limited, Gebr. Heinemann SE & Co. KG, The Shilla Duty Free, The King Power International Group, James Richardson Corporation Pty Ltd., Duty Free Americas, Inc., Flemingo International Ltd., Dubai Duty Free, and China Duty Free Group Co., Ltd. Dufry AG is the global leader in travel retail with presence in over 60 countries. LOTTE Duty Free is one of the top players in Asia Pacific region.

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