CTG DUTY-FREE(SH:601888) Zheng Quan Shi Bao·2025-08-26 13:10Core Insights - The opening of new duty-free shops in Shenzhen and Guangzhou marks a significant expansion in China's duty-free retail landscape, with the total number of city duty-free stores increasing to 27 across 22 cities [1][19] - These city duty-free stores are expected to play a crucial role in converting tourism traffic into consumer spending, especially as the country aims to boost inbound tourism [1][19] Group 1: Operational Models and Strategies - Both Shenzhen and Guangzhou duty-free stores adopt a "taxable + duty-free" dual-zone model, allowing a broader range of consumers to shop without departure restrictions [3][5] - The stores feature a mix of imported and domestic products, with a focus on popular Chinese brands and international luxury goods [5][7] - The strategic location of these stores in key shopping districts enhances foot traffic and consumer engagement [5][20] Group 2: Market Challenges and Consumer Behavior - Despite the potential, city duty-free stores face challenges such as competition from e-commerce and changing consumer preferences, which have led to a decline in demand for traditional duty-free shopping [10][20] - The pricing of some duty-free products is higher than that of similar items available through online platforms, which may deter consumers [20] - The success of these stores is heavily reliant on attracting sufficient foot traffic, particularly in major urban centers with high international visitor numbers [20][21] Group 3: Future Prospects and Recommendations - The expansion of city duty-free stores is seen as a way to revitalize the retail sector and stimulate local economies, particularly in light of the government's push for increased inbound tourism [19][21] - To enhance competitiveness, it is recommended that these stores diversify their product offerings and include popular domestic brands that appeal to both local and international consumers [21]