Premier Tax Free CEO Patrick Waldron who recently visited Athens revealed that tax free market has grown by 12% in Europe during the first four months of 2017 and an improving trend is being projected for Greece this year.
In the following exclusive interview by Tornos News, he states that over the next number of years, Greece will become more appealing for Chinese, Russian and Middle Eastern tourists as a safe, welcoming and diverse cultural experience. He also pledges to continue to offer a first class service to the Group’s merchant and hospitality partners and ensure that they have the best products and solutions to serve their tourists.
“We are seven years in the Greek market and we are now the leading player in the market and want to consolidate and build on this achievement, through innovation, service and responsiveness to our partners,” he underlines.
The full text of the interview follows:
1. What is the latest trend in the tax free market?
After a poor 2016 where the European market fell by 8-10%, the first four months of 2017 has started very strongly with estimated market growth of 12% in Europe. We are seeing continued growth in Chinese tourists and significant increases in shopping by US, Russian and Middle Eastern tourists because of the strength of the dollar and the rouble. We expect this growth to continue throughout the summer as the tourist booking numbers for Europe are very strong for this period.
In terms of countries, we are seeing a return to growth in France and Italy, with significant increases in Spain, Portugal and the Nordics and an improving trend projected for Eastern Europe, Greece and Cyprus. Germany remains subdued as does Belgium due to the continuing impact of terrorist attacks.
2. How is Brexit affecting these trends?
The immediate impact of the Brexit vote was a 10% fall in the value of Sterling. As a result, the UK market saw growth of 20-25% in the second half of 2016 versus a fall of c. 10% in the first half of 2016.
Without any change in the negotiations, the full impact if Brexit would mean that EU tourists would be eligible to recover VAT on purchases in the UK and UK tourists could recover VAT on purchases across the EU. Personally, I think it is likely that the UK and the EU will agree to exempt this in their discussions so we are not putting this into our plans.
3. What are the prospects for the Greek market?
I think the medium term prospects are very positive although the first Quarter of 2017 has seen a fall in the number of tourist arrivals. Over the next number of years, I believe that Greece will become more appealing for Chinese, Russian and Middle Eastern tourists as a safe, welcoming and diverse cultural experience. The recent lowering of the Tourist VAT Refund threshold from €120 to €50 – which Premier Tax Free took the lead on – is already resulting in a large increase in shopping spend and I think this will continue to make Greece a very attractive destination.
4. What are your impressions from your visit to Athens?
This is not my first visit to Greece but it is my first time visiting Athens. My initial impression is that it is more modern in feel and services that I expected with high quality hotels, restaurants and shopping experiences. But also there is a great sense of Greek history with the wonderful Acropolis dominating the skyline over the city. This combination of new and old is a great selling point and I will certainly be back again to explore the historical monuments in more detail.
5. What are your strategic plans for the future?
One of our main plans is expansion and we will enter many new markets for tax refunding and currency conversion. Today, Premier Tax Free operates in 34 markets and within three years I expect that this will increase to over 50 markets globally. In the short term, we will commence operations in Russia, Slovakia, Middle East, South Korea and China for tax free while in the last year, we opened operations in Finland, Malta and Poland.
For currency conversion, we will start new businesses in Chile, Peru, Costa Rica, Japan and Brazil.
Another key strategic plan is to improve the tax refund process for merchants and tourists by moving from paper based transactions to electronic and mobile transactions. The mobile phone will provide the future for tax refunding allowing tourists to register their details and expand the refund options to mobile wallets, loyalty cards or air miles as well as cash and credit cards. For merchants, we can provide tablet solutions on IPAD’s etc. which will make the process much easier for them as well.
We are also working with Governments and Customs department to provide digital solutions at airports so customers can use kiosks to validate their vouchers rather than having to wait in long queues. Today over one quarter of tourists don’t claim their VAT refunds – mainly because of queues – and we think we can reduce this to less than 5% with improved technology.
Finally, for Greece, we want to continue to offer a first class service to our merchant and hospitality partners and ensure that they have the best products and solutions to serve their tourists. We are seven years in the Greek market and we are now the leading player in the market and want to consolidate and build on this achievement, through innovation, service and responsiveness to our partners.
