Dufry Reloaded

By Jorge Muñiz

As we get closer to the end of the year, it’s time to stop and reflect on how much we have achieved over the last 12 months. Words like resilience, change or resistance are probably overused in these pandemic times, when most companies – especially in the travel sector – have gone through very difficult moments and yet survived, faced with an unpresented event such as was the Covid outbreak and spread.

That’s why, for me, the word Transformation better describes the Dufry we have known the last couple of years. Because unlike other businesses that seem to have hibernated since the outbreak of the pandemic in the first part of 2019, Dufry has accelerated its transformation of the company. And in this journey to a new Dufry, we all have taken part.

Business Transformation

Travel retail has traditionally been a safe harbor, especially for those players with global presence. As passenger volumes globally grew consistently year after year, the main challenge was to seize the opportunity and sel to a growing number of customers that were naturally going through our stores. A business with quite good outlook visibility. However, things changed from one day to another; customer volumes were reduced to a fraction of their former size and the predictability of our business was replaced by high doses of uncertainty, leaving clear that the 2019 Dufry needed to adapt to this new reality.

This required adapting the business to a leaner and more flexible structure that would put us in a better position to take on the continuous changes that we have gone through. The organization of Dufry by regional clusters and the changes in the executive team, as well as the group consolidation with the reintegration of Hudson, served to simplify our business and to give Dufry the necessary agility to adapt to the new environment.

At the same time, we continued to strengthen our portfolio of operations with both the incorporation of new and exciting business opportunities – including non-airport operations such as Anecdote in Zurich or the participation at the Global Duty Free Plaza at Hainan’s Mova Mall in China – and the incorporation and renewal of airport store concessions.

Sustainability

For many years, business performance has been king when valuing a company – and not just from a financial and investing perspective, but also when selecting Dufry as a business partner or a place to work. However, there is a growing shift to the valuation of the non-financial performance of a company as well, and in essence, to assess if the business is sustainable in the long-term.

Under the acronym ESG, which stands for Environmental, Social and Governance, companies are now explaining how a company is organized and performs under these three elements. And on this front, Dufry has also evolved over the last few years.

The presentation of our ESG strategy at the beginning of 2021 marked a milestone in the company timeline. For the first time, the company was disclosing its non-financial ambition, presenting a clear structure and responsibilities to ensure that the long-term goals are achieved.

In the following months, we saw how many of the initiatives of this long term plan flourished. The appointment of a Chief Diversity & Inclusion officer at GEC level, the decision to discontinue the production of plastic carrier bags, initiatives to support our customers in the selection of sustainable products and the first steps taken towards establishing a plan to reduce our C0₂ emissions, and hence doing our part to fight against global warming, are just some examples of concrete actions adopted by Dufry in recent times. These actions require sensible changes in the way we do business and are also contributing to the shape of a new company.

Digitalization

The digitalization of Dufry is not a new topic and has been on the agenda for a number of years. However, recently, we have seen how this is gaining speed – to the point that this now represents an additional sales channel to Dufry, just as the convenience or specialized shops are.

Some ongoing initiatives, like the New Generation Stores, Red By Dufry or services like Reserve & Collect, have continued with their expansion and are now available in more and more locations. More recent developments, such as our joint venture with Alibaba, are expected to streamline the digital transformation of our business even more, and to take initiatives such as those listed before to the next level.

Our digital strategy keeps delivering on the objectives set. Our aim is to engage with our customers, both in- and outside of our stores, and here, technology can play an important role. From the first adoption of new technologies – like Amazon´s Just Walk Out technology in the Hudson Nonstop stores – to data processing and analysis, or digital communication channels, digitization has come to stay and enrich our customer’s shopping experience with Dufry, while helping to generate additional business opportunities.

Delivering Superior Shopping Experience

Yes, it is true that the company has changed a lot and very fast in the last couple of years. And these changes have built a more solid company ready to cope with the challenges ahead. What has not changed – and will persist – is Dufry´s leit motiv (or guiding principle) which is to deliver a superior shopping experience to our customers. And we all play a part in achieving this objective.

Videos

As we welcome back both customers and colleagues to our stores, it’s important to catch up on the latest updates and understand how much the company has evolved. In the following link you will find six videos that that will take you through the major milestones achieved in the last few months; a summary of the changes that have led to the new Dufry that we have briefly described in this article.