More than a year after Niagara Duty Free finished renovating its duty free store located on the Canadian side of the Rainbow Bridge in Niagara Falls, the modernized shop has devoted more space to spirits, particularly ice wine, with improved sales, Steve Richardson, Niagara Duty Free General Manager tells TMI.
The store, with 8,200 sqf of retail space, found a way to “maximize the space” and make the store more inviting, says Richardson.
“We did a complete change to the outside of the store, modernizing the exterior. The store always looked good inside for the amount of square footage that we have, but we couldn’t expand out or up. So our goal was to modernize the inside and to make the store appear to be larger and I think we accomplished that,” says Richardson.
“The highest percentage of our sales by far was alcohol, but it did not equal the amount of space it was occupying. Then we had souvenirs, jewelry, clothing, accessories, sunglasses, and purses occupying a disproportionate amount of the space. We are so small, so every square foot makes a difference.
“The idea was ‘What are we good at? What do the customers want? And where is the margin?’ Obviously we have an advantage in alcohol.”
Niagara Duty Free started construction in January 2017, with about 80% of the store renovated by July of that year. The fragrance department was then finished in 2018.
“Today after the renovation alcohol takes up more than half the space in the store. For souvenirs and clothing we used to have 15 or 20 suppliers. Part of the conscious decision was to go down to four suppliers.”
And the renovation has worked the way that was planned, says Richardson.
“We’re having a great year. We are up somewhere between 7-10%.”
Niagara Duty Free now has a dedicated tasting bar towards the front of the store where customers can sample spirits, with an emphasis on ice wine.
“Ice wine is a category that we recognized was important. We pulled ice wine out from the back of the store and made a real tasting bar. Ice wine is a significant part of our sales. We’ve had years where it has even represented up to 10% of our total.”
With Niagara Falls visible from the parking lot of the store, Niagara Duty Free lives up to its name. Its city location also makes the store’s clientele much more tourist-based, American, and seasonal than in the duty free shops located on other bridges in the area.
“Our business is 75% international, mostly Americans. We don’t get as many Canadians as the other border stores. Our location is a little different, because we are in the city. It is a phenomenon that the Falls are right there. It is to our advantage to have the customer come into the store, see the prices, and make a decision when they are coming home. We are also one of the only stores where the customer can pre-shop, where they can buy and then pick it up when they leave.
“Motor coaches also do that. They come in on a Thursday afternoon, all the passengers shop for an hour, we hold onto the merchandise, and they come pick it up the next morning when they are crossing the border.”
The motor coach business plays an integral part of Niagara Duty Free’s business, particularly after the summer months that make up most of the store’s business.
“Motor coaches are huge for us. In June, September, and October the bulk of the traffic, the walk-in and the family traffic, is gone. We’ll be dead for an hour and then all of a sudden we’ll have 300 people in the store because three motor coaches pull up. We also get the Chinese business, which is very different. We get vans that hold 6-16 people that are absolutely phenomenal.”
Niagara Duty Free also has a customer unique to its Falls-view location: people walking across the bridge.
“We are one of the few duty free stores with a license that allows us to sell to walkers. That business seems to be increasing. It is a short, beautiful walk. For us, visitors come over, be at the Falls for two hours and still purchase something at our store. They will purchase a product and we will walk with them with the goods to the turnstiles. And once they are on the other side of the turnstile we will hand them the goods. The amount of walkers is growing, but it is non-existent in the winter.”
Niagara Duty Free very much has a seasonal business, says Richardson.
“We do good business in a small footprint and in what is usually a short duration of time between June and October. In the winter our bridge is very quiet. If you came in here in January or February you can roll a bowling ball down the floor of the store and not hit a customer for three or four hours. But in the summer we are busy all day.”