Suppliers underline recovery in Latin America

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Mood of optimism spreads through the regional trade on the eve of ASUTIL

Leading suppliers to Latin American duty-free are backing retailers' recent assertions that the market is recovering strongly in 2004 after three years of turmoil.

Many of the region's travel retailers have said they are recording double-digit growth in sales in the months to August 2004, compared to the same period in 2003. As the region's economies pick up, more people are travelling and these travellers have more disposable income than before.

Altadis duty-free manager Latin America Franck Lemonnier said: "Sales have gone ahead of budget in Argentina and Chile and have gone exceptionally well in Paraguay. The increasing amount of European tourists throughout Mercosur but especially in Argentina has been very good news for our brands."

JTI International duty-free sales director Latin America Andrew Rutherford added: "During the first half of 2004, JTI sales in duty-free in Mercosur have increased 24% over the same period a year ago. We are pleased with this performance and continue to forecast a positive trend for the remainder of the year. The economic recovery in the Mercosur area is well under way."

Swarovski duty free manager Latin America Gonzalo Almada commented: "In the first half we have seen a combined increase of 128% throughout the continent but if we look at some individual operators the increases are even greater. We are especially pleased with the way things have gone at Puerto Iguazu where sales have more than doubled in the first six months and we are looking to increase distribution and introduce a number of new products in the second half of the year."

José Chao, vice-president of Bacardi Global Brands, is another to acknowledge the sales revival, although he stressed that full recovery could yet be several years away. "The stars of the region have been Argentina and Chile, whose economies have grown substantially. In the case of Argentina duty-free sales are almost back at the level they were a few years ago."

But he added: "Pricing can still be a problem where domestic market discounting has squeezed duty-free differentials."

The news comes as the region prepares for the ASUTIL South American duty-free conference, to be held in Salvador, Brazil on September 8-10.

The event is organised by TRW publisher Raven Fox and ASUTIL, the region's trade association.

To register, contact Raven Fox events manager Rossella Golluscio at rgolluscio@travelretailworld.com or register online.