AUSTRALASIA. Dufry has said it is committed to growth across the four business lines of duty free, speciality retail, travel essentials and food & beverage in the Asia Pacific region following the business combination with Autogrill.
Dufry President and CEO Asia Pacific Freda Cheung said the company is resourcing up in key markets to support that growth drive. She was speaking alongside Regional Managing Director Asia Pacific David Mackay in a panel session during the Australian Airports Association Retail & Commercial Forum in Brisbane last week.
Cheung said: “We are a total travel experience company. We are not a duty free company, we are not a food & beverage company. We have four lines of business. Therefore, for any market, whether it’s Australia, New Zealand, or whether it is China, Vietnam, Cambodia or India, we look at each market with those four lines of business in mind. Here in Australia we have a great legacy in duty free and in F&B, but in future that presence will be built on all four lines.”
Mackay said: “Far from giving up on this region [after losing the Melbourne duty free contract recently -Ed] we are coming at it pretty hard. We just need a seat at the table. We know there are opportunities coming up from Western Sydney Airport to Auckland Airport duty free, and we know that Perth Airport too is a fabulous partner for us in duty free, which we are focused on, as are Gold Coast and Cairns in F&B for at least seven more years, so that offers a solid base.
“Plus we see opportunities emerging across all four business lines and we look forward to the opportunity to deliver across all of these in Australia and New Zealand.”
Cheung said the over-arching ‘Destination 2027’ strategy means “putting the traveller at the centre of everything that we do”.
She added: “APAC has been identified as a key global market for us, and what we have been focused on since February is bringing two groups of very seasoned experts together, creating that dream team, as you have to get the people and the structure right.
“We have to ensure we deliver on the values that we promised our business partners as well as to ensure that this market develops and grows under our strategy.
“At some of the airports will continue to offer our retail service alongside F&B, just like we currently do. And then some other airports and on a case by case basis, we will develop an integrated offer. Some travellers at certain airports have come to expect a one-stop shopping offer. We will be bringing that forward and hope that some of the airport partners here will be interested. That approach doesn’t just drive our spend per passenger, it will actually drive revenue per square metre.
“Previously Dufry was thought of as a duty free company and Autogrill as F&B, and changing that perception will take time. At the same time we find there is already an enthusiastic response from some airports who have greeted the fact that we can do everything. It is very encouraging to find that airport partners and brand partners recognise the value that we are bringing to the table as a combined group.”
Mackay, who is responsible for Southeast Asia and Oceania across all four pillars, outlined the structure in more detail. “We will have strong country structures in each, crossing over all disciplines, led by a country General Manager. We will also have dedicated resource for business development in each region. It’s an exciting time.”
The APAC region will be led from Cheung’s new base in Singapore, where she has responsibility for the regional P&L. The regional office will house finance, HR, IT legal, commercial business development and other support functions.
Cheung said: “We recognise that as we get bigger, the more we need to have our strongest resources as close to the market as possible. We can then respond quickly to local market intelligence.
“If we take Australia for example, we will have a country GM with finance, HR, commercial and marketing support. That model is replicated in every country.”
On travel essentials specifically, Cheung said this was a key focus although she said that the Hudson brand may not necessarily be the vehicle for the regional market. She added that the use of Amazon Just Walk Out technology deployed in North America could be brought to Australia and New Zealand as part of Dufry’s expansion plans.
Domestic terminals are another focus; there Dufry said it has ambitions to expand. Mackay cited the tremendous recovery in domestic travel across the region, from airports such as Cairns and Gold Coast in Australia to Vietnam.
Cheung said: “In some markets domestic traffic is much stronger than international, so the question is, is there value for airports and a desire from the frequent traveller to see consistency, to develop loyalty, to know what to expect across the market?”
She added that growing speciality retail, from multi-brand category concepts to monobrand stores, is also on the agenda.
“We have quite a few of these in China though not in Australia currently. But there is no reason why we cannot or we should not. There are opportunities in areas such as wellness, or people who want to buy beauty or watches, sunglasses, handbags, while they’re travelling domestically – and we have the concepts. Every airport is different and we want to co-create a travel experience that is unique to the airports we work with.”
Of the opportunity to grow in the region, Mackay said: “APAC is a region of nearly 5 billion people so there is a terrific opportunity for this consolidated company. Australia and New Zealand are very much on our radar. So I say, open the door, give us a seat at the table, and let us show you how we can be a long-term trusted partner.”
On F&B, Mackay also noted that competition is highly intense with seven major players in Australia/New Zealand, more than in many other regional markets.
On the wider vision for partnerships in the industry, Cheung said: “We want a win-win-win for all the stakeholders and that demands creating a travel experience revolution. It is about understanding how travel is changing, and making a significant investment in that travel journey, and taking a balanced approach to our partnership with airport as well as brand partners. We cannot do it alone, so we need to come together for long-term sustainable growth. We are all in this together.” 
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