CHINA/SOUTH KOREA. Edition 6 of the acclaimed Oriental Travel Retail Observer (OTRO) has just been published, offering rich and timely insights into China’s duty free sector. It is now available by subscription (see panel below) on a one-off basis or discounted annual fee for 12 editions.
OTRO is a research and publishing alliance between Jessica’s Secret, China Merchants Securities, and law firm Jincheng Tongda & Neal. The Moodie Davitt Report works closely with Jessica’s Secret, having developed the popular Jessica’s Secret Index with the fast-growing Shanghai-based company.
OTRO, launched in July 2020, is a first for China’s travel retail industry in presenting regular industry research, big data analysis, Chinese consumer surveys, and legal opinions. The first five editions were published free of charge, drawing praise from all sectors of the travel retail community.
Highlights of Edition 6:
- A summary of all the latest key developments in the Chinese and South Korean duty free sectors: An integrated guide to latest business intelligence from these key (and inter-related) markets
- Travel retail-related tourism data from around the world, related to the preferences of the Chinese travel retail customers
- Price comparisons between selected travel retailers
- Spotlight on Taiwanese daigou, featuring interviews with daigous who purchase in Taipei and resell the products into the Mainland
|Subscribe to Oriental Travel Retail Observer
Oriental Travel Retailer Observer, published monthly and packed with critical business intelligence, is available for US$1,500 per edition.
A full-year subscription (12 editions) is offered for a -10% discount (US$16,200).
To subscribe or for more details please email info@MoodieDavittReport.com headed ‘OTRO subscription’
As a taster of what is on offer for the subscription package, the OTRO publishers are offering Edition 5 free of charge (see below).
Source: Jessica’s Secret
As a taster of what is on offer for the subscription package (see panel), the OTRO publishers offer Edition 5 free of charge here.
Highlights of Edition 5
Edition 5, published in November, breaks down Hainan’s offshore duty free sales, showing that cosmetics (83.5% of units, 48.9% of total sales), watches (12.2%) , and jewellery (also 12.2%) were the dominant categories. Fragrances was the second-biggest category by unit sales (458,000), though the lower price-points meant the category was worth just 4.9% of the total mix.
“Even if the Thai purchasing industry recovers in the future, those who are used to shopping in Hainan would hardly turn to those purchasing agents again” – Ivan, Thai purchasing agent
Edition 5 also highlights the positive impact Hainan has had on sector giant China Duty Free Group (CDFG). For the first nine months of 2020, CDFG’s total operating income was RMB35.14 billion (US$5.28 billion), a year-on-year decrease of +2.81%. But Q3 revenue (post the 1 July offshore duty free policy enhancement) soared +38.97% to RMB15.83 billion (US$2.38 billion).
The net profit attributable to the parent was RMB2.23 billion (US$335.60 million), up +141.9%, thanks to the implementation of the new policy. Critically, the removal of the former RMB8,000 (US$1,240) single-purchase limit saw a rapid increase in sales of luxury luggage, watches and precious jewellery with high gross profit margins.
In total, Hainan generated offshore duty free sales of RMB8.61 billion (US$1.30 billion) in Q3, a +227.5% year-on-year increase of 227.5%.
OTRO regularly features interviews with daigou purchasing agents and Edition 5 focuses on several such individuals.
Purchasing agent Helen says that due to the pandemic, the Thai purchasing service industry might not recover. She was a full-time purchasing agent living in Thailand before the outbreak.
Helen mainly purchases local Thai products such as medical products, latex pillows and food for her customers. She usually visits the local pharmacies, and sends the goods by land transportation back to China, a process that takes over two weeks.
Helen visits King Power stores when she travels to China…