CHINA. DFS Group has taken a 22% stake in Shenzhen Duty Free Ecommerce Co, which is majority-owned by Shenzhen Duty Free Group.
The investment extends an already successful relationship between DFS and Shenzhen Duty Free. The two companies have partnered together since 2018 with DFS supplying merchandise and advising on store upgrades across Shenzhen Duty Free’s network.
“Our future is highly digital, and very focused on China. Our customers associate shopping at DFS with a truly experiential level of luxury, and we are excited to mirror that experience for them digitally – pre-trip, in-market, in-store, and once they return home. The opportunities are endless.” – DFS Group
By leveraging the online portal of Shenzhen Duty Free Ecommerce Co and the domestic duty free capabilities of Shenzhen Duty Free, DFS will be able to supply customers in China with luxury products from some of the world’s best-known brands.
A DFS spokesperson said: “Our future is highly digital, and very focused on China. Our customers associate shopping at DFS with a truly experiential level of luxury, and we are excited to mirror that experience for them digitally – pre-trip, in-market, in-store, and once they return home. The opportunities are endless.”
Customers will be able to pre-order their purchases before traveling to the Special Administrative Region of Hong Kong and collect them on return at Shenzhen (which shares a land border with Hong Kong and is a key gateway to China), through a wholesale agreement with Shenzhen Duty Free. Pre-COVID-19, over 200 million travellers were crossing the border each year between Hong Kong and Shenzhen.
DFS already enjoys a powerful presence across the travel retail market in Greater China, including the PRC’s Special Administrative Regions of Hong Kong and Macau. The company, jointly owned by French luxury group LVMH and co-founder Robert Miller, already operates 11 stores and plans to become the most desired travel retailer in China within a few years, sources say.
While COVID-19 has accelerated the rise of online shopping and shone new light on Chinese consumer trends in recent months, DFS’s strategy was already firmly focused around both.
*Note: With additional original reporting from Duty Free Expert, owned by Jason Cao, with whom The Moodie Davitt Report works closely. Duty Free Expert, a well-regarded B2B information source on Chinese travel retail, is a Preferred Media Partner at the forthcoming Moodie Davitt Report Virtual Travel Retail Expo.
Both DFS Group and Shenzhen Duty Free will also be in attendance at the Virtual Travel Retail Expo.
