Tumi CEO plans for about 50 U.S. airport stores
NEW YORK |
NEW YORK (Reuters) - Tumi Holdings Inc (TUMI.N) plans to make stores in airports a big part of its expansion push, and the high-end luggage and accessories maker could have about 50 such stores in the United States over time, up from a handful now, its chief executive said on Thursday.
Tumi, whose luggage can sell for more than $1,000 a piece, has seen its sales rise as it adds a variety of accessories as well as bags aimed at professional women.
"We think there's opportunities for about 50 airport stores in the States, just the States, for travel retail," President and Chief Executive Jerome Griffith told the Reuters Retail and Consumer Summit. "It's a big opportunity for us."
Tumi took over the leases for stores at the Minneapolis/St. Paul and Philadelphia airports at the beginning of this year. The company just signed a deal to open up shop in the international terminal at Los Angeles International Airport, he said.
Griffith said that he initially expected the Minneapolis and Philadelphia airport stores would each sell about $900 to $1,000 in merchandise per square foot each year.
However, the Minneapolis location is on track to hit $2,000 per square foot in its first year, while the Philadelphia store should hit $2,600 per square foot in the first year, he said. That compares with company-wide annual sales of $972 per square foot last year.
Griffith said Tumi, which has fewer than 100 full price stores in the United States, could have 200 in its home market, excluding airport stores.
Airport stores are a growing business for luxury companies such as Estee Lauder Cos Inc (EL.N) and LVMH (LVMH.PA) as they tap growth in global travel. U.S. airports have long been seen as shabby compared to new airports in China and Singapore, among other places.
Large renovations at hubs like Atlanta's Hartsfield-Jackson have drawn retailers. Estée Lauder Co's M.A.C. and Brookstone Inc TEMSHB.UL were among the brands to open stores at that airport's splashy $1.4 billion international terminal that opened in May.
Swedish data firm Generation Research is forecasting global duty free and travel retail sales to hit $52 billion this year, up 40.5 percent over 2008 levels.
Tumi also has a couple of partner-operated stores in Atlanta's airport, two in New York's JFK airport and it just signed a deal to open up shop in the international terminal at the Los Angeles airport, Griffith said.
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(Editing by Phil Berlowitz)
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