Lotte Duty Free readying to open first inner city duty-free store in Vietnam in Da Nang
The local authority in Vietnam is expected to give a go-ahead to Lotte Group’s first city travel retail store in the country within this month.
Lotte Duty Free first advanced into the Vietnamese market in 2017 with the opening of its store at the Da Nang International Airport. It then added outlets at the Cam Ranh International Airport in Nha Trang and the Noi Bai International Airport in Hanoi.
Lotte Duty Free hopes to add second inner city store in Hanoi, the capital city of Vietnam in the first half of next year.
Lotte Duty Free has been active in expanding its travel retail business in Vietnam on expectations for the fast growth of the Vietnamese tourism industry. Foreign tourists to the Southeast Asian country plunged to 3.84 million in the virus-ridden 2020 from 18.01 million in 2019, but the number is estimated to start to bounce back to 5 million this year and to 18 million in 2026, according to the Vietnam National Administration of Tourism.
Travel industry has been improved, with the number of inbound travelers reaching 480,000 in August, nearly half of the total number of tourists from January to July.
Vietnam’s luxury goods market is estimated to grow fast at an annual rate of 7.17 percent from $974 million in 2020, according to market research firm Statista. The wine market is forecast to expand at an annual rate of 6.5 percent in 2023-2025.
“The latest decision is to target Vietnamese consumers spending more on luxury goods. The Hanoi airport currently earns 5 percent of its revenue from spending by locals, but the ratio is expected to increase to double digits within three years from now,” said Kim Ki-kyung, head of Lotte Duty Free’s Vietnamese operation.
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