“In the meantime we have renewed our shop in Batumi, enlarging it by nearly 100 percent, and we hope to open it by 1 June, 2014,” Ahmet Kothene, Deputy General Manager of ATU Duty Free, told The FINANCIAL. “We hope to offer more perfume and cosmetic products and also increase the accessory product lines,” he added.
There has been a +7.66 percent increase in total sales in Tbilisi Duty Free in the first quarter of 2014 compared to 2013. However, last year ATU Duty Free experienced a 9.15 percent increase in total sales compared to 2012.
“In the first quarter of 2014, the Kutaisi operation had a 9 percent share of all Georgia Operations (Tbilisi, Batumi, Kutaisi). This is not a bad number considering the 1st quarter is the slowest time of the year,” he said.
Q. Kutaisi is the third operation point of ATU Duty Free in Georgia after Tbilisi and Batumi. Could you please compare these three points to each other? Which one has the best sales statistics and which are you the most satisfied with?
A. Tbilisi has the best sales statistics. It makes a contribution of 82 percent of all our Georgia operations sales. Batumi and Kutaisi have almost the same share with 9 percent each.
In Tbilisi, the Wines of Georgia shop performs well. We have a 4.88 percent increase in sales in the first quarter of 2014.
Opening the Wines of Georgia store has been very successful both in financial and sustainability terms to preserve and promote Georgian wine culture. It is enjoyed by passengers using Tbilisi Airport. ATU Duty Free established the wine store in 2011. There are 11 wine brands currently represented in the store. Teliani is one of the best-selling brands with a 7.48 percent share of overall spirits, but Khareba Kindzmarauli Red is the best-selling product.
Q. In general, which is the best-selling duty free product in Tbilisi, Batumi and Kutaisi airports?
A. According to the 2014 first quarter results, the best-selling products in terms of quantity are:
In Tbilisi: Khareba Kindzmarauli Red.
In Batumi: Yeni Rakı 100 CL.
In Kutaisi: Ritter Sport 9er Mini Sor. mix 150G.
In our Georgia operations we have 197 brands represented in duty free.
Q. ATU Duty Free opened its first stores in Tbilisi and Batumi in 2006. How did you pass through the difficult periods and what were the main challenges for you? What is ATU Duty Free’s position today and what are the current challenges that it faces?
A. Tbilisi and Batumi were the first foreign operations of ATU. Today, as of the beginning of 2014, ATU has operations in Tunisia, Latvia, and Macedonia too. In addition, we plan to open shops in Saudi Arabia at the beginning of 2015.
Many things have changed in Georgia, from the currencies used in the shops to the customs regulations. Each year we try to improve our stock as well. Fortunately there has been good growth since 2006. We were negatively affected by the incidents with Russia. We lost sales during these periods but we did not give up and the economy was strong enough to pick up again. We have also had a good relationship with the Ministry of Agriculture, implementing the Wines of Georgia shop in the airport.
Q. Who are the main customers of duty free? Could you please give us the statistics of the nationalities of your customers?
A. In Tbilisi: Russian, Ukrainian, Georgian, Turkish and Azerbaijani are the nationalities spending the most in duty free. In Batumi the statistics are as follows: Turkish, African, Russian, Ukrainian and Georgian; and in Kutaisi: Ukrainian, Georgian, Far Eastern, Russian and Azerbaijani.
Q. ATU Duty Free also offers Georgian wine in its stores at Istanbul Ataturk Airport to more than 20 million passengers annually. Is Georgian wine popular there, and if so, to what extent?
A. Yes, Georgian wines are sold. Since there are wines from all over the world in our shops in Istanbul the demand is not very high, but it is a good source of exposure and recognized by Russians, Latvians and Georgians primarily.
Q. You received a Golden Brand award. Why do you think that more than 200 experts have named your brand as a favourite one and how does this award help ATU Duty Free in its PR and marketing activities?
A. We are very proud and honoured to receive this award. For the past 8 years we have tried to maintain a high level of service in our shops and always continue to invest in our employees. Happy employees make happy customers. We try to improve our shops and expand our stock while selling the best quality world brand names at the most competitive prices. We try to meet all international standards in our line of business.
We believe in the future of Georgia and we are sure there will be many more developments to come.
We always try to listen to our customers and meet their needs. We do not want to be a standard duty free operator. We want to be active, flexible, adapting to the new trends and behaviours. We hope to continue to grow in the MENA and the Caucasus region.