Lotte Duty Free, South Korea’s top duty-free operator, said it has set up a new outlet at a Vietnamese airport, making a foray into the Southeast Asian market.
Lotte clinched a joint venture deal with a Vietnamese counterpart to co-run Phu Khanh Duty Free at the Da Nang International Airport, it said in a statement. The South Korean firm owns a 60-percent stake in the airport duty free. The official opening is slated for August, with only part of the shop currently operational. It sells perfume, cosmetics, food & beverage and liquor.
Da Nang is one of the most popular holiday destinations among South Koreans. PHU KHANH Duty Free shop is located in the new Danang airport, which has been newly expanded due to the recent increase in visitors, and the international flights are on the way to accommodate 4 million passengers per year.
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Korea’s duty-free marketis suffering from a 30-40% decrease in sales due to the due largely to a void in Chinese visitors following Beijing’s trip restriction. Last month, the number of foreign visitors to Korea’s duty-free shop reached a record low this year, falling below 1 million. The number of foreigners who visited Korea’s duty-free shop in April dropped by 40 percent from 1,682,223 in January to 99,806.
The launch of its Vietnamese duty-free shop underscores Lotte’s push to expand its overseas foothold. Lotte is the third-largest duty-free operator in the world, after Swiss-based Dufry A.G. and DFS of the United States.
It is the first Korean duty-free operator to have tapped Vietnam.
Lotte Duty Free said it is planning to open another city branch in Bangkok this month. It currently runs airport stores in Indonesia, Japan and Guam.