Chinese Baijiu company Luzhou Laojiao aims to grow its footprint in global duty free and travel retail following success in Asia Pacific.
Luzhou Laojiao Company, currently valued at close to CNY100 billion (US$15.75 billion), owns two brands, Luzhou Laojiao and Guojiao 1573. The company’s distillery is located in southern Sichuan, considered the home of Baijiu.
Luzhou Laojiao is one of the oldest Chinese liquors still in production and the history of its distillery dates back to 1573. According to the company, Luzhou Laojiao is the top-selling spirits brand in China.
Guojiao 1573 is a high-end liquor brand and recorded sales of CNY10.39 billion (US$1.65 billion) in mainland China in 2017.
The company started international operations in 2012 and has since entered the duty paid markets in 44 countries and regions. During 2016 and 2017 Luzhou Laojiao extended its presence to ten duty paid markets in Africa.
Luzhou Laojiao’s strongest duty free market is Asia Pacific. During 2014 and 2017, it achieved a +100% annual sales increase in China Duty Free outlets. In 2016, the company started a partnership with Sunrise Duty Free.
Luzhou Laojiao said it has also made rapid growth in South Korea and Vietnam with Lotte Duty Free and in Thailand with King Power International.
In 2017, Luzhou Laojiao began collaborating with Heinemann in Australia and Malaysia.
This year Luzhou Laojiao said it will focus on developing the Middle East, Africa and North America markets. The company aims to expand its sales network through a classic version of Guojiao 1573. It will launch duty free-exclusive products such as Guojiao 1573 with a gift package, oak barrel liquor and destination-specific products.
Luzhou Laojiao will also continue to expand in Asia Pacific. “We will invest heavily to establish brand zones in Hong Kong and Beijing Capital international airports and keep on strengthening the tax-free selling in airports in popular tourist destinations in Southeast Asia,” the company said.
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