In today’s China Watch 2023 webinar on the TFWA 365 virtual platform, Zhuhai Duty Free Chief Deputy Director Procurement Operations Center, Daniel Chow provided an update on the company’s operations and on the current consumer landscape in China.

Here are the key takeaways from his session:

– Post-pandemic, the number of China’s inbound and outbound shoppers has been rising, especially in Hong Kong, Macao and Mainland China.

– Hong Kong, Macao and Zhuhai have implemented policies to restore tourism. The new tourism resources are attracting consumers who are spending more time at the destinations.

– Hong Kong continues to be a popular shopping destination for Chinese tourists. Its diversity of retail brands and products attracts mainland consumers who consider it a “shopping paradise”.

– Even with its gradual recovery, Hong Kong is still attracting consumers from around the world.

– Passenger growth between Zhuhai and Macao ports is expected to recover to pre-pandemic levels this year.

– Macao is a very popular tourist destination for the Chinese and there have been some spending behavioural changes, with more consumers choosing to spend more money on better services and products, rather than in casinos.

– The Arrival Duty Free Mall at Zhuhai Gongbei Border, will officially debut with a new image in the first half of this year, creating a new benchmark in the Guangdong–Hong Kong–Macao Greater Bay Area.

– In February this year, Zhuhai Duty Free saw 112% year-on-year growth. Perfumes & Cosmetics has gained 246% this February compared with last year.

– In 2021, the China government announced plans for a “Hengqin Guangdong-Macao in-depth cooperation zone”. In May 2022 Zhuhai Duty Free group signed a strategic cooperation agreement with Hong Kong Lai Sun Group to combine resources of Hong Kong and Macao with the cultural tourism, fashion and commercial retail businesses in the Greater Bay Area and mainland, to jointly build Novotown a “heavyweight commercial centre”. In January 2023, further regulations for promoting the development were passed. Using Hainan as a benchmark, Hengqin “integrates deeply with Macao to create an unprecedented duty free pattern.”

– The project in Hengqin is expected to be a positive source of growth for Zhuhai Duty Free group. It is very near Macao, and a key district for business tourists who will go there.

– Phase 1 of the project will be located at the core promotion area of Novatown; Phase 2 will be a comprehensive shopping experience centre for high-quality consumer goods, with the aim of building and integrating online and offline shopping systems.

–  In 2021, the total sales volume of offshore duty free shops in Hainan exceeded 60bn yuan.

–  In 2023, Hainan will also focus on boosting consumer demand. The number of tourists and tourist income is expected to increase by 20% and 25% respectively this year, and offshore duty free shopping sale will exceed 80bn yuan.

– Zhuhai Duty Free is participating in the development of Hainan offshore duty free business with its Sanya Central Business project. It is a key project “implementing the spirit of Hainan,” as the benchmark for the construction of a hi-tech free-trade port, and an international tourist destination with retail and commercial areas.