SOUTH KOREA. City Duty Free, a small and medium enterprise (SME), will withdraw from its duty free concession at Seoul Gimpo Airport on 21 April.
City Duty Free Senior Managing Director Merchandising Division Allen Hong confirmed the development to The Moodie Davitt Report yesterday in Seoul. The company has been losing hundreds of thousands of dollars each month on the business, which was badly affected last year by the THAAD-related decline in Chinese tourism.
City Duty Free, owned by CityPlus, won the liquor & tobacco contract at Gimpo in 2016, but its high concession fees have become unsustainable Hong said.
The company was recently awarded one of the concessions set aside for SMEs at Incheon International Airport’s new Terminal 2. And it will open a 3,300sq m downtown store in Seoul by December this year.
Lotte Duty Free also operates at Gimpo Airport, having been the sole bidder for the cosmetics & fragrances space in the fourth re-run of a tender in 2016 that until then had failed to attract any bids. Along with The Shilla Duty Free (the other incumbent, which chose to exit the airport on financial grounds), it had cited excessive minimum annual guarantees.
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