Even if Brazilian airports can’t cope with the arrivals, the Duty Free shops can!

With the world about to descend on Brazil for the World Cup, there is good news and bad news for the travelling duty-free shopper. Brazil is the world’s most sophisticated country when it comes to “arrivals duty free shopping” with an inbound store located in the baggage hall of every major international gateway airport.

GRU Airport Baggage Hall Shops

Travelling Brazilians are more accustomed to picking up their tax-free goods on arrival than people in the Northern Hemisphere. Up to 40% of duty free sales can be conducted on arrival in Brazil, a concept virtually unknown in Europe or North America, where all such sales are made on departure. Even better, in Brazil you get an additional duty free allowance of USD$500 for goods purchased in their arrival airport stores. This extra limit can include up to 12 bottles of whisky, gin or other spirits and with the price of brands, such as Johnnie Walker Black, sky high in local supermarkets, groups, family and friends will appreciate the opportunity for a discount dram during The Copa.

That’s where the good news ends, because for smokers, health & beauty conscious Brazil is getting tough on smoking and the cigarette allowance has come down to a carton of 10 packs (200 cigarettes) and although you can buy tobaccos on arrival, you’ll probably only find Marlboro and some local Brands for sale. The British certainly won’t find many Virginia blends like Benson & Hedges or Lambert & Butler and pipe or tobacco smokers might also struggle to find their desired products.*

Anyway, local cigarette prices are as cheap as the airport, but a word of advice if you like Dunhill, make sure you ask for Carlton, otherwise you won’t be understood! These brands were “merged” not too long ago and the new product is still known as Carlton in the kiosks, a marketing peculiarity.

So, on your arrival at the major airports you will at least have a last minute opportunity to pick up some gifts or necessities and unless the Brazilian airports have upgraded their back-offices as well as their frontages, you might have plenty of time on your hands.

There has been much chatter and negative allegation in the media as to how the airports will perform and although São Paulo Guarulhos Cumbica, (now known as GRU Airport) has just opened its international Terminal 3, nobody seems to have explained how all these innovations will work for Customs, Immigration, baggage, security and connecting to domestic flights with the likes of Azul, TAM, GOL or Avianca Brasil. 

Airport construction December 2013 Sao Paulo

If this photo is anything to go by, (taken in December 2013) the opening of T3 GRU is nothing short of a miracle, but perhaps because the piers and connection points are not quite as ready as the front end?

Which brings us on to the perennial subject of “Liquids in Transit”, LAGS as they are known in the trade. Here, that extra case of whisky or bottle of perfume might cause you a problem if you try to connect to another domestic flight, en route to see your team play.

All passenger baggage now clears customs in Brazil at the first arrival airport, be it hold or carry-on baggage. So, if you are moving on to another city, most likely via Rio, Sao Paulo or Brasilia, you are going to have to take those “duty frees” through security. This is where you may have problems, because the EU and US concept of “STEB” sealed security bags being accepted for transit passengers, has not been fully integrated in Brazil. And, if the massive queues (seen in December 2013) for security transfers to domestic flights, is any guide, you are in for a long wait, if not confiscation of your goods.

So, there is some clear and simple advice evolving here.

Only bring liquids if you are going downtown from your original arrival airport. i.e. if you are coming in via Salvador, Natal, Recife or another gateway and just staying there, you’ll be fine. But, if you are moving on to another (domestic) flight, beware of potential problems.

Of course, if you re-pack your duty-free liquids in your checked baggage when you clear Customs, the problem goes away. But after the average 10/12 hour flight into the country from the North, who wants the hassle of this??

But, if you are an avid buyer, you can find all the Brazilian duty free products and prices online before you get there by searching your airport on our sister site Duty Free on Arrival. At this time, pre-order doesn’t appear to be available for foreigners and the sites are normally only in Portuguese.

Either way, let’s all assume that Brazil is up for the Cup and just to be sure you are, check before you fly!

*since our last visit to Brazil, the stores may have increased their selection to cater for the influx of foreign visitors. Check the Duty Free Dufry online catalogue for more details.

Japan discusses duty free on arrival and Downtown taxfree shopping.

As reported by the Trade Publication, The Travel Retail Business, Japan is now considering the introduction of arrivals duty free shopping (入国時免税店) in airports and Downtown Taxfree shopping (免税店 ダウンタウン).

Duty Free on arrival is common in Asia and Oceanea with many countries operating the practice of baggage hall shopping in their airports.

Whilst duty free on departure is available in all airports, arrivals shopping is a practice unheard of in Europe and North America. The Japanese are big spenders in the duty free market and the article suggests that the introduction of such shops will repatriate revenues whilst also affecting other retailers abroad, who could lose sales if the practice is legalised.

The Firm Duty Free Shoppers (DFS) is the largest retailer in the downtown duty free market and is especially well known to Japanese Travellers who visit these huge luxury emporiums in places such as Hawaii, Guam and Australia.

ダウンタウン、世界的な免税品。大規模 免税店 チェーンの DFSギャラリア ( DFS Galleria ) を運営し、 アジア 太平洋 地域を中心とする15ヶ国に150店舗を展開している。

入国時にも免税店で買い物を　国交省、税制改正要望

To check before you fly all other world destinations where you can buy your duty free on arrival, go to our search portal.

Duty Free home delivery? Areas and Barcelona Airport announce delivery initiative.

Areas are somewhat unknown in the airport retail and duty free market, but in fact this Barcelona based Firm is a big player in airport services around the world, especially in Latin markets.

The Company operate a series of retail and catering concessions in many travel locations, including major airports in Spain, Portugal, Argentina, Mexico and Chile. Their retail partners include concession outlets in airports with Brands such as Adidas, Farga and tuc tuc.

This week Sr Diego Rodriguez the company's sub-director for retail distribution, announced a series of tests in relation to the home delivery of goods purchased at Barcelona airport Terminal 1. The concept is to be known as "Nobags".

The purpose of these home delivery tests and the firm's ambition to expand this service derives from the change in the airport retail market and the "one bag rule" carry-on baggage rule imposed by airlines.

There is wide recognition that travellers are inhibited by the carry-on baggage rules, particularly those imposed by low-cost airlines such as Ryanair and that this is inhibiting airport retail sales. Areas intend to address this anomoly with their initiative by providing a home delivery service for their customers.

The Company wishes to use the scheme for the different types of passenger journey so that they can increase sales without the customer having to worry about carrying the goods on board the aircraft.

Within the European Union duty free and tax free sales do not exist, so goods purchased in Barcelona for another EU destination are tax paid. This means that deliveries can be made to any EU address without difficult customs regulations.

But, what this innovation demonstrates is that goods sold to travellers in Europe are better delivered on arrival than on departure as this avoids all the difficulties for travellers.

Areas suggested that the scheme could be extended to all major airports in Spain and perhaps beyond at a later stage.

To find out where you can buy duty free on arrival and all global duty free allowances, visit www.dutyfreeonarrival.com

Cochin Airport Eyes Arrival Duty Free

Cochin International Airport in India is showing a 30% increase in sales revenue over last year with the majority of this coming from non aviation areas.

The passenger count is up 10% for international arriving and departing to 2.6 million showing that customers are spending more on duty free merchandise. In order to enhance future growth the Cochin International Duty Free shops are focusing upon an "online business model". This would allow customers to place their orders online and take delivery of their duty free goods upon arrival at Cochin Airport at the arrivals duty free shop.


The software for this pre-order system is now being implemented and will go live soon.

Ireland's Shannon Airport - where does it go from here?

In 1947 the Irish Customs Free Airport Act established Shannon Airport as the world's first duty free facility something which would become a template for other Duty Free facilities worldwide. The sharp rise in the number of transatlantic flights to North America established the airport as the last refueling point between the two land masses but the introduction of long range jet aircraft it soon saw passenger numbers decline.

Ryanair - was a regional hub for the airline?

Being under the control of the government owned Dublin Airport Authority (or Aer Rianta as it was known as then) since 1969 it has always been felt that Shannon Airport was seen as a second class status with it now being Ireland's fifth airport and suffering a 37% decrease in passenger numbers in 2010. Even with the advent of the low cost airlines such as Ryanair the DAA has not been able to cement a steady enough relationship with Ryanair who have taken traffic to other airports in Spain.

However, in a turn around decision this week it has been outlined that Shannon Airport will no longer be under the authority of the DAA - the Government will still own Shannon Airport but the direct control of the airport is being handed over to local management at Shannon Development, the regional development agency.

The Future Options for Shannon Airport

The first priority is to increase passenger numbers now it will be able to compete on a level playing field with the other Irish airports. Also establish niche activities will make it a player in the aviation market - with its long runway and abundance of surrounding land for warehousing, 24 hour flying capability due to its isolated location, US customs clearance (the only one in Europe) it would make a good European hub for cargo. The first development of this kind has already been signed with the US cargo group Lynx building a 19,000 sqm facility for a global airport cargo facility specialising in international logistics services.

The title of the world's first duty free shop will still remain with Shannon as long as they can guarantee their future with growth such as this.

Social Media takes hold of Europe's Airports

In a new report "Digital Report 2012" by ACI Europe it has emerged that Europe's airports are creating a direct link with it's customers through social media, such as Twitter and Facebook, with airports in Central Europe being the most proactive.

The report highlights the fact that over 33% of Europe's airports are developing or have mobile "apps" to give the passenger more live information - this includes corporate communications, crisis communications, customer service, informal customer relationship building, and commercial promotion.

Gatwick Airport has 30,000 Twitter followers

The chief objective of most airports is to make information available so as to make the passenger experience as hassle free as possible.

London Gatwick Airport has recently been honoured with Twitter's "blue tick" of authority with it's 24 / 7 Twitter customer service support. It now has 30,000 Twitter followers plus a website and Facebook site.

In Poland, Warsaw Chopin Airport has over 11,000 Twitter followers sending information out in both polish and English. The tweets are made up on updates on flight information, traveller tips and special offers in the airport duty free shops.

It is expected that social media will take a more proactive role in the future.

Australian Govt are pushing for ban on arrivals tobacco

According to leaked reports in Australia the government there is edging closer to a ban on all arrivals duty free tobacco. It is suggested that that the reasoning behind this ban will lead to increased government revenues through taxation and not for health reasons. An independent analysis by Deloitte Access Economics calculates the net tax gain to be in excess of A$17 million per annum although this does not take into account additional Customs enforcement costs.

This ban would have a deep affect of the Australian duty free industry as Australia's Arrivals Duty Free Shops would be covered by the ban.
 
This, however, has brought a strong response from the Australian Duty Free Association who feel the government have overstated the additional tax revenue it would achieve and not taken into consideration the damage this will cause to the duty free industry and loss of revenue to operators and airports.

There is no date set for the implementation of this ban.

Jericho Duty Free Shop planned

The Palestinian Authority is planning to open a duty-free shop in Jericho as President Mahmoud Abbas has approved the project. The project is subject to the Palestinian Authority cabinet approval but the profits will support the president's fund for students in refugee camps in Lebanon and underprivileged areas.

The duty free shop will be set up at the Palestinian Authority arrivals and departures hall at the Allenby Bridge crossing servicing over 1.7 million people per annum between the West Bank and Jordan. 

Most West Bank residents must travel via the Allenby Bridge to Amman's airport to travel internationally as there is no airport in the West Bank and Israel forbids most Palestinians from using Ben Gurion Airport in Tel Aviv. 

Initially the duty free shop will sell traditional products such as cigarettes, perfume and chocolate and then later electronic goods. 

The Changing Face of Travel Retailing

The Worldwide travel retail business is worth in excess of $30 USD billion and over two thirds of this is down to airport shopping. Nevertheless, as seen in the past it is more sensitive because of its susceptibility to crisis - SARS crisis and 09/11 are just two examples which hit the sector the hardest. The airport operators world wide are becoming more dependent upon the retail revenue as the emergence of budget airline operators suppress their revenues by moving out to new airports offering the best prices for them.

Over the last 10 years it has become a key feature of airports to showcase "walk-through concepts" - passengers are guided from the airport entrance to the airplane departure gate through a frenzy of retail sales activity (e.g. Duty Free Shop), a path of retail temptation. It is found that passengers are at their most relaxed after completing check-in, passport and security checks.

One of the growing trends now is the advent of the Arrivals Duty Free Shop - perfect locations for last second shopping on arrival or for travellers not wishing to carry duty free goods on a long journey. this gives the retailers an opportunity to showcase locally made products. However, the big drawback with arrivals duty free shops is that this entails changes in legislation to allow such an activity to take place - usually a long draw out process. Recent examples of new arrivals duty free can be found in Switzerland and numerous countries in South America.

The whole aim of these latest trends is to convert the "passenger" into a "shopper" - no easy feat since in excess of 70% of passengers do not shop, not really surprising as they are actually there to travel!. However, a well spoken about concept in the airport industry is the phrase "sense of place" in conceptualizing travel retailing. One of the foremost authorities on this is Robbie Gill of The Design Solution company who have designed airports throughout the world. He believes that this "sense of being" should and will play a major part in transforming passengers into shoppers via transforming their travel retail experience. Gill believes that bringing a "local flavour" into the equation will go a long way to achieving this and he cites the examples at Barbados' Grantley Adams International Airport, where the shops all have corrugated roofs reminiscent of chattel homes, and Minneapolis with sculptures of Snoopy and Canada geese in the terrazzo floors. Changi Airport in Singapore has its own very unique 'sense of place' through the remarkable range of gardens such as the Sunflower Garden, Orchid Garden, Cactus Garden and Butterfly Garden.

The Design Solution recently worked on The Irish Whiskey Collection Duty Free retail store at Dublin Airport's new Terminal 2. This is retail with a true 'sense of place', as it only promotes Irish Whiskeys to local and international travellers. The new concept and store design was created solely to boost Irish Whiskey sales within the airport's duty free store, boosting Irish Whiskey sales by over 30%.

It can be demonstrated that 'sense of place' is far more than bricks and mortar; it is of the locale, the commerce and the culture. It shows a more interesting passenger experience, and in today's tough operating climate where travellers have more choice of where to fly from than ever before, that cannot be underestimated.

Survey supports a "fat tax" for overweight fliers

A recent survey carried out by HolidayExtras.com, the website specialising in hassle free add ons, reported that over 48% of respondents were in favour of additional flying charges for obese flying passengers.

Over 51% of those questioned believed that over weight passengers should pay extra because of their contribution to additional fuel consumption in the same way that other passengers pay for excess baggage.

This highly controversial move has been referred to in the past as a "fat tax" and was subject to a Ryanair survey on fliers in the past of which a third supported such a move.

It was also discussed by some US airlines that overweight passengers should in fact buy an additional flight ticket or the airline offer some of the revenue to the passenger next to the obese person.

Such measure would allow other weight reduction measures carried out by airlines such as reducing the amount of duty free luggage.

The "Perfect Seat" on a flight

A recent passenger survey conducted by the flight comparison website, Skyscanner, asked 1,000 airlines passengers about their seating preference on board an aircraft. They were given the option of an aisle, window or middle row seat.

And the result from a standard plane....seat 6A.

This finding backs up similar surveys carried out in the past which suggest the popularity of the first six rows due reduced engine noise, quicker exit from the plane on arrival and better selection of food and duty free trolley. The preference though would be for an aisle or window seat as only 1% of those questioned said they would opt for a middle seat.

Some airlines are now preparing to charge people for booking seats and with this data available EasyJet airline plans to charge £8.00 for this sector in the plane and £3.00 elsewhere.
 

First six rows are the preference

And the least popular seat... 31E (middle seat at the back). Presumably this is due to lack of choice on the duty free trolley! 

European Parliament will give the United States access to personal information about airline passengers.

Millions of airline customers’ personal data (PNR - Passenger Name Record) will be handed over to the United States Department of Homeland Security after MEPs of the European parliament voted 409 to 226 for new laws that it is claimed are crucial in tackling terrorism.

The PNR Data includes - names, addresses, ethnic origin, credit cards details and phone numbers, as well as religious meal choices and some sensitive health information. The agreement is applicable between flights between the EU and USA but not only airlines from there but also any carriers that are "incorporated or storing data" in the EU and operating flights to or from the US.

The data will be retained for 10 years under stricter access rules. 

The main concerns are privacy of such data and who will have access to it. Other pressure groups have raised the questions what if Russia or China should ask for the same information.

Duty Free shop purchases are not subject to this bill.

  

The Future of UK aviation in the hands of Politicians

 

British Government Aviation Minister, Theresa Villiers, has re-iterated the government stance of a third runway at Heathrow stating it would have a "massive" impact on nearby resident's quality of life with the increase effect of over 220,000 more over London per year. 

Instead, "another solution" to south east England airport capacity was needed, Mrs Villiers said at a transport conference in London in April 2012. She acknowledge that Heathrow was near capacity as is and Gatwick fast approaching this.

However, this goes against evidence produced by Colin Matthews, CEO of BAA which owns Heathrow airport who argues that foreign airlines are moving away from the idea of the airport due to aircraft capacity constraints. This would have the effect of the UK losing out to rival European airports if Heathrow is not expanded. 

The Board of Airline Representatives in the UK (BAR UK) which produced the poll shows that 53% of scheduled airlines have either decided to, or are preparing to, base flights in other countries than the UK because of Heathrow's lack of capacity and 86% of airlines said they would put on more flights to the UK if additional take-off and landing slots were available at Heathrow.

The message is clear - no capacity at Heathrow then the airlines will move out of Britain - thus handing any economic growth to European competitors. Needless to say there would be no travel retail, duty free growth either which is critical revenue for the airport owners.
   

Spanish Airports Authority to put Duty Free Shops out to tender.

The Spanish Airports Authority (AENA Aeropuertos SA) are set to announce the tender to manage the countrywide duty free shops in the country. AENA is the public body which owns the majority of the airports (with the exception of two privately owned airports) and also controls the air traffic control body. Aena is the world's largest airport operator with 47 airports and two heliports in Spain (carrying 193 million passengers in 2010) and participation in airports in Mexico, the USA, Cuba, Colombia, Bolivia, Sweden and the UK.

The current operator Aldeasa, part of the Autogrill owned World Duty Free Group, has had a three year extension to the current contract which expires on 31 December 2012. The new contract is expected to increase revenues in duty free and will attract some of the big names in the duty free world - Dufry, LS travel retail, Gebr Heinemann and The Nuance Group, to name a few.

Consultants to assist in handling the tendering process are expected to soon be appointed.

Calls for Child-Free Flights!

 

According to a recent new poll carried out by JetCost on 1,666 adults nearly two thirds of the respondents claimed their biggest grudge inflight was "loud children" followed by poor food and lack of legroom. The poll then went onto to identify that 53% of respondents would be in favour of child-free flights.

Ongoing issue for airlines - children on flights

Other issues include reclining seating and also seat allocation but even historical surveys still point to the children issue on flights although there is no clear evidence of any airline adopting such a stance.

However, there may be a movement towards this as Malayasian Airlines new Kuala Lumpur - London A380 service will ban all children under 12 years old from its top deck in response to customer complaints about crying children. Kuala Lumpur airport is one of growing number of airports in the Far East offering duty free on arrival to its incoming passengers.

 

Bahrain F1 Grand Prix 2012 - will it go ahead?

With the Chinese F1 Grand Prix going ahead this weekend (12-14th April) the subject everyone in the Formula One circuit is talking about is "will the Bahrain Grand Prix go ahead?". 

With the first Bahrain Grand Prix taking place in 2004 even taking the Best Organised Grand Prix by FIA the cracks first started to appear when the 2011 Bahrain Grand Prix was cancelled due social unrest within the country. The race was not rescheduled for later on in the season. The same thorny issues of social unrest and civil protests still exists which leaves the 2012 hanging in the balance. 

Bernie Ecclestone, CEO of Formula Management / Administration, is adamant that the teams will be there and there is no security risk to the competitors. He will be meeting all the racing teams principals in Shanghai although officially the issue of Bahrain will not be on the agenda.

While Bahrain gets over 2 million visitors annually, the majority of those coming from other regional Arab countries, there is an increasing number from outside of the region. With the country having duty free on arrival shops the country can ill afford to have negative publicity which will affect the increasing important tourism industry replacing the depleting oil industry.


Only time will tell.....

Air Passenger Duty (APD) - unfair tax or polluter has to pay?

Definition - "Air Passenger Duty (APD) is an excise duty which is charged on the carriage of passengers flying from a United Kingdom airport on an aircraft that has an authorised take-off weight of more than ten tonnes or more than twenty seats for passengers. The duty is not payable by inbound international passengers who are booked to continue their journey (to an international destination) within 24 hours of their scheduled time of arrival in the UK".

The amount charged depends upon the distance you will travel to your destination ranging from £12.00 on the shortest European destination to £85.00 for over 6,000 air miles. When introduced in 1994, APD was sold to the public as a variant of an environmental tax. But, unlike the EU Emissions Trading Scheme which incentives airlines to use their aircraft more fuel efficiently, APD is a flat rate tax per passenger that does nothing to help the environment. Even the UK Treasury has now admitted that it's primarily a revenue raiser.

However, the British Government has decided to increase this charge, despite them collecting £2.2 billion in revenues in 2011, to twice the level of inflation from April 2012 causing the whole of the travel and tourist industry to be in arms.




The new rates in their "band" format are punishing especially for families travelling - a family of four will pay £52.00 in tax to Spain, £260 to Florida and £368 to Australia (and that is for Economy Class).

With UK airport passengers numbers the same as 2004 it is becoming increasingly more difficult to attract tourists for duty free shopping. It is worth noting that 22 out of 27 EU countries have no similar tax so it no wonder that Italy attracts three times more Chinese tourists than the UK... and a similar story with Germany and France.

So, is this an unfair tax on UK holiday makers, UK tourism and UK businesses..... or a way tax the polluters?