Specialist
Former senior executive at DFS Group Ltd
Agenda
- Airport retail overview and economics
- Tourism trends across impacted US airports and segments, focusing on luxury vendors
- Chinese tourism share of global airport sales volumes and impact from the novel coronavirus
- Potential retailer productivity impact and operational cuts on decreased travel volume
- Outlook for 2020 and beyond
Questions
1.
What would you highlight as key trends or developments in airport retail?
2.
Could you outline the airport retail economics and the mix of retail vendors?
3.
Are the trends in retail mix fairly consistent across major airports?
4.
How would you size the travel retail industry?
5.
Who are the key players in travel retail?
6.
How much is a travel retail player such as Dufry exposed to major US airports or other international hubs?
7.
Could you outline the partnership dynamics or operating structures between key airports and retail groups?
8.
Do airlines play any role in airport travel retail?
9.
How would you characterise the traffic trends across major international hubs?
10.
What is the typical consumer sentiment and behaviour towards airport retail, and how has it changed with the impact of the Hong Kong protests and now the novel coronavirus outbreak?
11.
Could you share an overview of travel retail consumer demographics, including country of origin, age groups and income brackets?
12.
Was any particular retail brand or category favoured by the key affected demographic of the Chinese student consumer?
13.
Where is the Chinese student consumer spending across the luxury brands?
14.
How would you assess the level of spending as a function of travel volumes?
15.
What proportion of a consumer’s overall trip budget is spent on travel retail?
16.
You mentioned the mainland China consumer spends an average of USD 135 on travel retail. What percentage of that mix is pure apparel retail or luxury retail vs other categories such as cosmetics?
17.
How has this base case scenario of travel retail spend been impacted by the novel coronavirus outbreak?
18.
Would you say that mainland travel from China has completely halted?
19.
Which airports or travel retailers would you say are most impacted by the decreased travel volumes?
20.
Prior to the coronavirus outbreak, what was the productivity in airports as a percentage and how does it compare now?
21.
Are there any specific labels within the major conglomerates that you would say are most or least impacted?
22.
What is the exposure of the luxury brands to disruption in travel retail? What percentage of LVMH’s revenue is derived from airport retail?
23.
How are vendors and retailers addressing the impact? To what extent can they scale operations to manage the decreased productivity?
24.
Have you noted any airport retailers that have shut down operations altogether or have had significant headcount reductions?
25.
Do airport vendors have any concessions in place to mitigate the impact of the coronavirus?
26.
Has there been any suggestion of retailers potentially exiting airport rental leases earlier than expected?
27.
What was the ultimate impact of the 2003 SARS outbreak to airport vendors and the overall travel retail industry? Is it a useful comparable to the coronavirus?
28.
After the SARS outbreak, were there any safeguards implemented for airport retailers in the event of a similar outbreak?
29.
What are the latest estimates for traffic volumes across airports, how have they been changing, and how would you assess those estimates?
30.
How long was it before the market stabilised after the SARS outbreak?
31.
Are there any travel retail names you would say are significantly less exposed to the coronavirus impact than others?
32.
Considering the cyclicality of travel retail and consequently airport vendor sales, how would you characterise the revenue contributions expected for a typical Q1? It is often slower for traditional retailers – is it the same for travel retailers?
33.
Do you have any concluding remarks on airport or travel retail?
34.
What key indicators would you monitor to gauge how the situation is developing?
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