Lotte, Shilla and other duty free shops here are too dependent on Chinese tourists who are responsible for nearly 70 percent of their sales.
Analysts say the growing dependence of duty free shops on Chinese shoppers is their biggest risk, cautioning that they would suffer greatly if the Chinese stop coming. The stores should make efforts to diversify customers by attracting more people from Russia and Southeast Asia, they said.
According to data submitted by Lotte Hotel to the Financial Services Commission, Sunday, the nation’s largest duty free store operator said it earned 70.8 percent of its sales from Chinese customers in the first three months of 2016, up from 63.3 percent a year earlier.
In contrast, Japanese shoppers accounted for only 3 percent of Lotte Duty Free sales, down sharply from 21.6 percent in the first quarter of 2012.
Shilla and other duty free shops are also in similar situations, suggesting that the fate of Korea’s duty free industry largely hinges on those coming from China.
(Source: Korea Times )