April 06, 2019

Duty Free PHL seeks higher profits by trimming staff

THE DUTY-FREE Philippines Corp. is seeking to streamline its organization in an effort to trim costs, and increase its profits.

This was disclosed by DFPC Chief Operating Officer Vicente Pelagio A. Angala to select media on Thursday, while expounding on the aim of the government corporation to be a leaner organization.

At present, he said, DFPC has some 800 employees, which includes sales staff at its malls, airport kiosks, and branches nationwide. Asked how many employees may be trimmed by the reorganization, Angala declined to say, but added, “let’s put it this way, we can work with half the number,” or about 400 employees.

He intimated that the salaries of the employees impact on the bottomline of the company, and it may be possible for its malls and outlets to operate with just a sales manager or a cashier, but the concessionaires themselves will hire their own sales force and support staff.

He said the reorganization “will be done in phases” so as not to disrupt the operations of the corporation, an attached agency of the Department of Tourism (DOT).

The new Luxe Duty Free outlet of DFPC at the Mall of Asia complex is targetting the mainland Chinese market. (Image courtesy DOT)
For the year ending December 31, 2016, personal services reached some P470.4 million, accounting for 24 percent of total operating expenses that year. No audited financial statements have been made available for the years 2017 and 2018.

Earlier, Angala said the DFPC is targetting to hit some $220 million (P11.66 billion) in sales this year,  just 1.4 percent higher than the $217 million (P11.5 billion) generated in 2018. While no figures were available yet for 2018, the corporation netted a profit of P179 million in 2017, up 9 percent from the P164 million earned in 2016.

He is hoping the opening of the new Luxe Duty Free outlet at the Mall of Asia complex, which targets the mainland Chinese tourists in the country, along with new stores in provincial airports such as in Puerto Princesa and Panglao Island, will help boost the sales of the corporation.

Meanwhile, in its thrust to help increase the income of small and medium-sized enterprises as well as local farmers, DFPC recently added homegrown brands to its online shopping web site.

Three months after the online shopping web site was launched, customers can choose from over 150 products, from perfumes and cosmetics, liquor, toys, confectionaries and now export-quality Filipino brands.

“For three decades, Duty Free Philippines has been known to be the haven of luxury and imported goods. That is still true but we want to also emphasize the importance of enabling our local entrepreneur,” said Angala.

Some of the local products available at www.dutyfreephilippines.ph are Just Fruit manufactured in Metro Manila; Kick-start Coffee of Silang, Cavite; Malagos Chocalates of Davao; Risa Chocolates of Las Piñas City; Tanay Hills Coffee of Rizal; and VuQo Premium vodka of Caloocan City.

Angala added that all 54 local brands available at all Duty free stores will be available online before the end of the year.

To shop online, customers need to provide their flight details. Items will be prepared and customers could pick them up at the airport.

Each passenger is allowed to buy up to $1,000 worth of items, 48 hours upon arrival.

At the Luxe outlet, the Filipiniana section currently featuring items from the SM Mall’s Kultura section will be slowly replaced by the premium export-quality consumer products, liquor, and furniture crafted by Filipino artisans.

Overseas Filipino workers and balikbayans (returning Filipinos) can shop up to 15 days from date of arrival. The shopping privilege is further extended to 30 days during the Christmas season (for those arriving from November 15 to January 15 the following year).

Senior citizens and persons with disabilities have an extended privilege of shopping up to 365 days from the date of their arrival in the country.

Under the Tourism Act of 2009, 50 percent of the revenue of DFPC is remitted to the DOT for tourism-development projects

*Originally published in the BusinessMirror, April 4, 2019.