Luxury retail giant Duty Free Shoppers closing New Zealand stores

Luxury retail giant Duty Free Shoppers will close its New Zealand and Australian stores by September amid challenging economic conditions.

The Hong Kong-headquartered company confirmed the closure of its Auckland, Queenstown and Sydney locations after three decades in the Oceania market.

Duty Free Shoppers (DFS) stores in New Zealand are branded T Gallerias.

A spokesperson for DFS said its New Zealand stores would remain open until September 30.

“As part of an ongoing review of our global store network, DFS has made the difficult decision to close our operations in Sydney, Auckland and Queenstown, marking our exit from the Oceania market.

“This decision reflects challenging economic conditions and is aligned with DFS’ broader strategy to optimise global operations.”

DFS Group’s network spans major airports and downtown stores around the world.

The company carries major brands including Armani, Burberry, Bvlgari, Chanel, Estee Lauder, Hugo Boss, Montblanc, Polo Ralph Lauren and Versace.

DFS is a majority-owned subsidiary of the luxury conglomerate Moet Hennessy Louis Vuitton (LVMH).

“During this transition, we are fully committed to supporting our dedicated team. We are proud of our three-decade journey in Oceania and are immensely grateful to our employees for their hard work, passion, and contributions,” a spokesperson said.

DFS wouldn’t confirm the number of staff affected.

Inside DFS' Auckland department store, named T Galleria.

Auckland CBD’s retail scene has been plagued by ongoing challenges from Covid-19 lockdowns, weak consumer spending and the slow progress of the City Rail Link (CRL).

Several major retailers have shut up shop over the past couple of years.

In June, department store Smith & Caughey’s closed its iconic Queen St store after 145 years in central Auckland.

Smith & Caughey’s acting chief executive Matt Harray told the Herald in May that foot traffic on Queen St was significantly lower than it was at the same time last year.

“You go over to Europe, and even Australia, and you just see how vibrant these main streets are, and then you see ours here ... it’s just not the same.”

Last year, French beauty retailer Sephora announced it was closing its flagship store on Queen St after just five years.

Heart of the City, the business association for Auckland’s city centre, revealed in its March quarterly results that city-centre foot traffic was down 10% compared with the March 2024 quarter.

Foot traffic was down 4% from the previous quarter (December), a drop of around 4300 people each day.

Stats NZ figures last month showed card spending in the retail industries fell by 0.2% ($9.9 million) in the month of May compared with April.

Westpac senior economist Satish Ranchhod told the Herald he believed that retail spending would remain “soft for a while yet”.

He said households were holding off on making major purchases for now.

“One factor that will be constraining many households’ spending is the continued rise in food prices, with the cost of many household basics like butter and milk rising sharply in recent months.”

Cameron Smith is an Auckland-based business reporter with the Herald live news team. He joined the Herald in 2015 and has covered business and sports. He reports on topics such as retail, small business, the workplace, and macro-economics.