Thursday, July 31, 2008 Duty Free opens outlet in mall By Nancy R. Cudis Sun.Star Staff Reporter
TO reach more overseas Filipino workers and tourists, Duty Free Philippines (DFP) opened a 1,800 square meter outlet—its second biggest store in the country after Fiesta Mall in Paranaque City—in the Northwing of SM City Cebu.
But if plans to close the DFP store at the Waterfront Cebu City Hotel and Casino by the end of August will push through, there will still be two outlets in Cebu.
With Cebu fast becoming a major tourist attraction and the opening of a Sofitel Hotel near SM City Cebu, DFP went into talks with the SM Group about a year ago on opening up the outlet in the mall.
The store, which was completed in two weeks, was worth an investment of at least P20 million and has a staff of 14.
“We feel that the market can be serviced by this store,” DFP general manager Michael Christian Kho told reporters during the opening Tuesday.
The other DFP outlets are located at the Mactan Cebu International Airport, a couple in Davao City and four at the Ninoy Aquino International Airport.
Historically, Cebu’s DFP outlets accounted for 15 percent of the total annual nationwide turnover or roughly $27 million out of $170 million it made since the 1980s.
Recently, Cebu’s DFP outlets were making a combined annual turnover of $9 million. Kho said they are hoping to raise the sales with the establishment of the new branch.
Kho said DFP’s dollar revenues have grown considerably since 2006 because of the increase in overseas Filipino workers as well as the province’s strengthened tourism sector.
Products
But its peso revenues are “actually flat” with the strengthening of the peso against the dollar.
Perfumes, cosmetics, liquor, tobacco and confectionery are among the sought-after duty-free items.
Still, DFP is optimistic that its combined revenues for all of its stores nationwide will increase by at least 10 percent to 15 percent this year.
“We see a potential in the Visayas market and we believe that this store will be able to tap that market. We want to establish our base and earn revenues before looking at other areas for expansion. It is worthy to note that Cebu is the only one in the Visayas that has an international airport that services international flights. We want to (complement) that service,” Kho said.
No other outlets are in the pipeline this year after DFP’s aggressive expansion in the 1990s that caused the management some difficulties.
SM Supermalls president Annie Garcia said that the DFP store in SM City Cebu completes their selection of merchandises that cater to the class A and B market.
Tourism Undersecretary Phineas Alburo added that the outlet is a “welcome development” to Cebu as more international flights are being arranged.
He reported that from January to May this year, Cebu posted an 8.2 percent increase in tourism arrivals compared to the same period last year.
