Duty Free and Travel Retail Market Size, Share, Analysis, Trends, Growth, 2032

Duty-Free and Travel Retail Industry Prospective:

The global duty free and travel retail market size was worth around USD 48.20 billion in 2023 and is predicted to grow to around USD 83.97 billion by 2032 with a compound annual growth rate (CAGR) of roughly 7.30% between 2024 and 2032.

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Duty-Free and Travel Retail Market: Overview

Duty-free and travel retail refers to a special type of goods buying experience that generally occurs in international zones. The major attractive feature of duty-free and travel retail is the lack of national or domestic taxes on the products bought by international travelers. The most common points facilitating duty-free and travel retail include airports, border shops, and cruise ships. In recent times, the revenue generated by tax-free mode of retail has increased substantially driven by several factors.

For instance, consumer awareness about tax refund policies has improved when buying products across international zones. In addition to this, the surging rate of international travel for leisure or business purposes has also increased. During the forecast period, the duty free and travel retail sector is projected to grow at a fast pace due to rapidly expanding airport infrastructure.

Additionally, luxury brands at airports and other tax-free areas are likely to create more growth opportunities in the coming years. The market players must focus on emerging economies that are witnessing a change in consumer preference, which could generate new avenues for further growth, according to industry research.

However, the duty free and travel retail industry faces growth restrictions in terms of changing global travel scenarios as economic certainty continues to impact the decisions of everyday consumers.

Key Insights:

• As per the analysis shared by our research analyst, the global duty free and travel retail market is estimated to grow annually at a CAGR of around 7.30% over the forecast period (2024-2032)
• In terms of revenue, the global duty free and travel retail market size was valued at around USD 48.20 billion in 2023 and is projected to reach USD 83.97 billion by 2032.
• The duty free and travel retail market is projected to grow at a significant rate due to the increasing rate of the global travel index.
• Based on the product type, the food & confectionery segment is growing at a high rate and will continue to dominate the global market as per industry projection
• Based on the distribution channel, the airports segment is anticipated to command the largest market share.
• Based on region, Asia-Pacific is projected to dominate the global market during the forecast period.

Duty Free and Travel Retail Market: Growth Drivers

Increasing rate of global travel index to drive market demand rate according to reports

The global duty free and travel retail market is expected to grow due to the rising number of travelers worldwide. Since COVID-19, the global economy has witnessed a sharp year-on-year increase in the number of travelers exploring other parts of the world. The traveling experience is influenced by several factors.

For instance, business travel is a major part of the global travel & tourism industry. According to official reports, Africa welcomed more than 66 million international tourists in 2023, registering an increase of nearly 96.01% from 2019. Africa, for instance, has registered a rise in the number of foreign investments in recent times across major industries.

On the other hand, the economy is also investing heavily in the growth of domestic companies which further facilitates increased business-related travel. Similar statistics are observed in other parts of the world as well. One such example is Japan. The country was among the top preferences of travelers from across the globe as more people wanted to explore the regional culture and cuisines.

Europe continues to dominate the global tourism sector with people traveling from around the world to different countries forming the continent. As the number of international and domestic travelers continues to rise, duty-free and travel retail service providers can expect more revenue since consumer spending habits also continue to evolve with more travel experience.

Increasing consumer awareness and launching government initiatives for traveler awareness to generate market revenue

The luxury shopping sector has registered monumental growth in the last few years. The increase in job opportunities along with a rise in the annual income of the general population has allowed a growing number of the population to indulge in luxury shopping. In addition, the number of millionaires and billionaires across the globe has grown at a steady pace in the last decade.

For instance, around 6.69% of the US population is currently classified in the millionaires group. Emerging economies such as China and India have also registered similar trends. The Glona duty-free and travel retail market can grow further by investing more strategically in expanding luxury shopping through tax-free mediums since it allows consumers to save added tax on luxury goods.

For instance, in December 2021, Louis Vuitton opened its first travel retail unit in the Middle Eastern region at Dubai International Airport (DXB). The company chose terminal 3 of DXB which is the world’s third-largest terminal building and one of the most populated in terms of travelers from across the zone.

Duty Free and Travel Retail Market: Restraints

Economic volatility and the changing global travel scenario will limit the industry’s final growth rate

The global duty free and travel retail industry is expected to be restricted due to the changing global economic order. A large number of countries worldwide are registering a rising inflation rate.

In addition to this, in 2023, several multinational and domestic companies carried out large-scale layoffs leading to a loss in job opportunities. The global travel scenario is unpredictable as witnessed during the peak of COVID-19. The rising number of travel-related accidents and health scares in crowded places such as airports may impact the final growth rate of the industry.

Duty Free and Travel Retail Market: Opportunities

Increasing expansion of airport infrastructure and cruise ships to generate growth opportunities

The global duty free and travel retail market is projected to generate growth opportunities due to the rising investments in airport infrastructure advancements and expansion. Since the number of air travelers is increasing with time at a rapid rate, regional governments are prompted to invest in developing world-class travel infrastructure for smooth domestic and international travel.

For instance, recent reports suggest that the John F. Kennedy International Airport in New York, US, is expected to spend nearly USD 4.2 billion on the construction of a new terminal to replace currently existing terminals 6 & 7. The new facility is expected to have 10 gates out of which 5 will be operational by 2026. India, on the other hand, is expected to witness the inauguration of a state-of-the-art international airport in the Navi Mumbai area. The greenfield airport is being built in three phases and is expected to aid the smooth travel experience of people flying in and out of the country.

In November 2024, Hamad International Airport (DOH) announced the expansion of its operations in terms of connectivity to China. The airport unit has now launched direct flights to Shenzhen being operated by Shenzhen Airlines. In addition to this, the growing number of cruise ships and increasing travel enthusiasts preferring waterways will also improve final growth opportunities for the market players.

Duty Free and Travel Retail Market: Challenges

Changing international regulations to challenge market expansion trends in the future

The global duty free and travel retail industry is projected to be challenged by the dynamic status of international regulations governing tax-free products across international zones. Each country has a specific regulatory framework allowing protocols in the duty-free retail sector. Adhering to the changing and complex legal status can be difficult for duty-free and travel retail service providers, leading to a diluted growth rate.

Duty Free and Travel Retail Market: Report Scope

Duty Free and Travel Retail Market: Segmentation

The global duty free and travel retail market is segmented based on product type, distribution channel, and region.

Based on the product type, the global market segments are food & confectionery, jewelry & watches, fashion & accessories, tobacco, fragrances & cosmetics, wine & spirits, and others. In 2023, the highest demand was listed in the food & confectionery segment. Confectionery items such as cookies and biscuits are some of the items that are most sold in duty-free shops.

In addition to this, the fashion & accessories sector is also one of the largest revenue generators with the increasing popularity of luxury items as well as fast fashion clothing. According to market research, travelers typically spend more than USD 150 per person on duty-free chocolates.

Based on the distribution channel, the duty free and travel retail industry divisions are ferries, airports, seaports, cruises, and others. In 2023, the highest revenue was generated in the airports segment. The growing rate of air traffic worldwide is fueling the segmental demand rate.

Moreover, investments in airport expansion as well as increasing the number of luxury and affordable stores within international airports are expected to drive the segmental revenue further during the forecast period. In 2023, India hosted more than 64.9 million international air travelers, according to sector analysis.

Duty Free and Travel Retail Market: Regional Analysis

Asia-Pacific to lead the market growth rate during the forecast period

The global duty free and travel retail market is expected to be led by Asia-Pacific during the forecast period. One of the major reasons for higher regional market revenue was the growing number of international travelers from Asia-Pacific countries such as Japan, China, India, Singapore, and others.

Furthermore, the changing consumer lifestyle with an increase in per capita income along with the availability of several new modes of international travel are critical to the region’s overall revenue.

For instance, in January 2024, Adora Magic City, China’s largest cruise ship, set sail for a seven-day voyage crossing through the Sea of Japan. The cruise ship has a capacity of around 5,250 passengers and has allowed the country to mark its entry into the cruise-based travel & tourism sector. In addition, airport expansion projects across Asia-Pacific have gained significant growth momentum as air traffic continues to grow. I

n December 2024, China announced its plan to build the world’s largest artificial-island airport called the Dalian Jinzhouwan International Airport. The country has also approved the construction of a new airport as of January 2025 in the Guangdong region and it is expected to become operational by 2028.

Duty Free and Travel Retail Market: Competitive Analysis

The global duty free and travel retail market is led by players like:

• China Duty Free Group (CDFG)
• Heinemann
• Estée Lauder
• King Power International
• Dufry
• Gebr. Heinemann
• Shiseido
• Lotte Duty Free
• Aer Rianta International
• Richemont
• DFS Group
• Michael Kors
• The Shilla Duty Free
• Chanel
• Lagardère Travel Retail

The global duty free and travel retail market is segmented as follows:

By Product Type

• Food & Confectionery
• Jewelry & Watches
• Fashion & Accessories
• Tobacco
• Fragrances & Cosmetics
• Wine & Spirits
• Others

By Distribution Channel

• Ferries
• Airports
• Seaports
• Cruises
• Others

By Region

• North America
  • The U.S.
  • Canada
• Europe
  • France 
  • The UK
  • Spain
  • Germany
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Southeast Asia
  • Rest of Asia Pacific
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • South Africa
  • Rest of Middle East & Africa