Booming Retail Sales From Brexit Set New Course For Britain-EU Ferry Market – Forbes

0
79

Stena Line’s Irish sea ferry Stena Emba is loaded with freight and passengers in Liverpool, United … [+] Kingdom. (Photo by Christopher Furlong/Getty Images)
Ferry routes between the U.K. and European Union are seeing some dramatic retail sales rises, so much so that the ‘booze cruise’ is making a comeback, while new port stores are being built as a way to recoup losses from the Covid pandemic. It seems that a ‘Brexit bounce’ is a reality in some sectors.
Both Sweden’s Stena Line and Denmark’s DFDS have reported growing interest in their new land and sea shopping facilities connected to Britain-EU ferry routes. This is thanks to duty-free pricing being reintroduced at the start of the year by the British government, with sales uplifts becoming noticeable this summer after lockdowns started to be lifted.
The biggest saving are on wine and spirits and tobacco where duties are heaviest. On routes between Ireland and Wales for example, Stena Line has seen a boom. In a statement, Stena Group said: “Early figures show the huge potential (of onboard shopping) to help the travel sector bounce back after the pandemic.” Spend per passenger in the company’s shops jumped by 400% in August 2021 versus August 2019, before the pandemic started. Saving of up to 50% are touted by the company.
Stena Line’s Irish Sea trade director, Paul Grant, commented: “As our passengers start to return in large numbers, we are delighted to be in a position to offer them the added benefit of duty-free shopping for the first time in over 20 years.”
The ‘booze cruise’—where consumers take round-trip ferry journeys from and back to their port of embarkation just to avail themselves of duty-free bargains when in international waters—also disappeared in June 1999 when intra-EU duty-free sales were banned.
With those bargains back again, Stena Line has reintroduced low-priced return tickets at just £10 for these cruise sailings across the Irish Sea, with Friday and Sunday sailings staring from 5 November. Without leaving the ferry, passengers can shop onboard with access to, for example, a 1-litre bottle of Jameson Irish whiskey for £15, a very popular choice; 1-litre of Hendricks gin for £21; and two 1-litre bottles of Absolut vodka for £16.
Duty-free savings of up to 50% are tempting passengers in Dunkirk.
Meanwhile, DFDS opened a new €290,000 duty-free store in Dunkirk port in France earlier this month to take advantage of rising demand, just as Stena did with a port store in Holyhead. The 7,500 square feet of retail space in the Dunkirk terminal building follows the August unveiling of a 12,000 square foot shopping space, the largest of any ferry on the English Channel on the company’s Côte D’Opale vessel.
The Dunkirk duty-free port store is aimed at consumers looking to buy in bulk and expectations are high that volumes will be strong due to the substantial savings compared to U.K. local prices. DFDS believes that the new shop will add 140 million Danish krona ($22 million) in revenue for the company over the next five years and also help to drive tourism in the Calais and Dunkirk areas of northern France.
DFDS claims that the ferry business is entering a “new era of cross-channel shopping.” Steve Newbery, commercial onboard director, for DFDS in the U.K. said: “We need to educate the passenger where there are real savings to be had. Perfume is already our biggest sales category but spirits, wines, beers and new categories like electronics will feature heavily.”
Newbery added: “Back in 1999 the English Channel business suffered a huge drop after the end of duty-free and took many, many years to recover. This new opportunity combined with higher limits (on allowances) is a real positive for the ferry industry.”
Shopping spaces on DFDS’s Côte D’Opale ship have been upgraded.
DFDS—the market leader on the Dover, U.K. to France route running up to 54 sailings a day—recently surveyed passenger attitudes to duty free shopping. Newbery’s comment about passenger education reflects the finding that there is a lack of national awareness of the impact of Brexit. Just over one-third (35%) of respondents said they didn’t know anything about the changes to duty-free this year—though almost half (45%) said they always take advantage of travel discounts when available.
The most popular products bought by those saying they avail themselves of duty-free bargains are spirits (64%), beauty (61%) and wines (51%), with the majority of respondents spending between £100 and £199 in a duty-free shop. The DFDS strategy, like Stena’s, is to encourage the purchase of more premium, higher-priced products on board its ships through trading up, while bulk buying of standard lines is being shifted more to port shops.

I am tracking the pandemic-hit global travel retail channel as well as wider retail industry trends. For more than 20 years I have specialized in the beauty, drinks and

I am tracking the pandemic-hit global travel retail channel as well as wider retail industry trends. For more than 20 years I have specialized in the beauty, drinks and luxury goods sectors. I like using data to tell a story, and am particularly interested in industries such as aviation and tourism that underpin travel shopping. I have freelanced for The Mirror, The Times (London), Elle (Hong Kong), The South China Morning Post, The Moodie Davitt Report and Jane’s. Leads or relevant research? Get in touch or follow @krozworld. I am based in London, U.K.

source