Hudson Ltd. and its subsidiaries operate both duty-paid and duty-free stores throughout the continental United States and Canada.
The company sells a range of products in its duty-paid or duty-free stores that are mainly located at airports, commuter terminals, hotels, landmarks, or tourist destinations.
As a travel concession operator, the company operates primarily in airports and other locations where concessions are awarded by landlords, which include airlines, airport authorities, cities,...
Hudson Ltd. and its subsidiaries operate both duty-paid and duty-free stores throughout the continental United States and Canada.
The company sells a range of products in its duty-paid or duty-free stores that are mainly located at airports, commuter terminals, hotels, landmarks, or tourist destinations.
As a travel concession operator, the company operates primarily in airports and other locations where concessions are awarded by landlords, which include airlines, airport authorities, cities, counties, developers, master concessionaires, port authorities and states.
Retail Concepts and Products
The company operates various retail concepts across its retail locations, such as:
Travel Essentials and Convenience Stores: Under various brands, including the company’s primary brand Hudson, its travel essentials and convenience stores offer an assortment of products to the travelling public, including portable electronics, reading materials, souvenirs, grab-and-go snacks and beverages, and travel necessities. These shops are operated as stand-alone stores, or in some cases, together with a coffee-take-out concept, such as Dunkin’ or Euro Café.
Duty-Free Stores: Under the brands, such as Dufry, World Duty Free, and Nuance, the company offers a range of traditional retail products for travelers on a duty-free and duty-paid basis, as applicable, including perfumes and cosmetics, food, jewelry and watches, accessories, wines and spirits, and tobacco. Majority of these stores are so-called ‘walk-through’ stores, which are designed to direct the entire passenger flow through the store. This concept allows travelers to explore the products that the company sells without needing to deviate from their way to the boarding gate.
Electronics Stores: The company’s electronics stores, operated under the brand Tech on The Go, offer products from a range of popular electronics and electronics accessory brands, including Sony, Bose, Belkin and Moshi.
Bookstores: The company’s bookstores offer an array of bestsellers and new releases, as well as a selection of hard cover, paperback, trade and children’s books. The company’s bookstores are operated under brands, such as Hudson Booksellers and Ink by Hudson, as well as local and regional bookstore brands, such as Tattered Cover and Book Soup, which the company operates pursuant to licenses with the owners of the brands.
Specialty Branded Stores: The company operates branded specialty stores, offering a range of products from a single international or national brand, including Coach, Estée Lauder, Kate Spade, Michael Kors, Kiehl’s, FAO Schwarz, Tumi and Brookstone. These stores, which are operated by the company’s team members, provide travelers with the same experience as shoppers at the primary locations of the brands and appeal to both customers and suppliers alike, such as customers could use their waiting time to shop for their favorite brands and suppliers have a visible showcase to display their products. The company operates specialty branded stores directly, although the brand owner or supplier might provide financial support.
Quick-Service Food Outlets: In addition to the company’s travel convenience and quick-service coffee combination stores, it operates quick service food and beverage outlets, such as Dunkin’ Donuts, Jason’s Deli and Pinkberry. The company operates these stores under franchise agreements. The company’s agreement to acquire OHM Concession Group LLC (OHM) further would further solidify F&B as one of its key pillars. OHM’s portfolio of concepts includes &pizza, the Kitchen by Wolfgang Puck, the Bracket Room Sports Lounge, Chick-fil-A, Currito, Dunkin’, Jamba Juice, and Einstein Bros.
Locations
As of December 31, 2019, the company had approximately 200 concession agreements and operated 1,013 stores across 88 retail locations in the continental United States and Canada, totaling approximately one million square feet of commercial space. Its locations are distributed across 77 airports, five commuter terminals, and six tourist/landmark destinations.
Duty-paid and Duty-free Operations
Duty-paid shops target domestic and international travelers. Standard duties and other taxes apply to sales in these shops. They are located in both international and domestic airport terminals, commuter hubs and other locations.
Duty-free shops are located in airports and offer goods to both international and domestic travelers, with international travelers exempt from duties and excise and other taxes on certain goods, such as tobacco and liquor.
Local Partners
The company operates majority of its stores located at airports in cooperation with local partners. The company partners with majority of these entities through the Airport Concession Disadvantaged Business Enterprise program operated by the Federal Aviation Administration. The company structures its store operations through associations and partnerships. As of December 31, 2019, the company had 121 associations and other partnerships with 98 local partners.
Suppliers
The company is supplied both directly from manufacturers and through distributors.
The company’s principal travel essentials suppliers are Core-Mark and Resnick Distributors. The company’s principal duty-free products supplier is Dufry AG (Dufry). The company’s principal beverages supplier is The Coca-Cola Company. The company’s principal book supplier is Readerlink Distribution Services.
The company’s principal magazines and periodicals suppliers are The American News Company and Hudson News Distributors, including Hudson News Distributors, LLC and Hudson RPM Distributors, LLC.
Strategies
The company’s strategies are to increase sales at existing concessions (continue innovation in store formats and merchandise, and refurbish and convert existing stores) and expand concession portfolio (continue to win airport concessions, continue expansion into non-traditional locations, improve food and beverage platform, pursue accretive acquisitions, and target improved profitability by leveraging its investments).
Regulation
The company is subject to the Fair Labor Standards Act, the Immigration Reform and Control Act of 1986, the Occupational Safety and Health Act, and various federal and state laws governing such matters as minimum wages, overtime, unemployment tax rates, workers’ compensation rates, citizenship requirements and other working conditions.
The company is also subject to the Americans with Disabilities Act, which prohibits discrimination on the basis of disability in public accommodations and employment.
Intellectual property
In the United States and Canada, Dufry or one of its subsidiaries (other than the company) holds all of the trademarks for its proprietary brands, including Dufry, Hudson, Nuance and World Duty Free, or the respective applications for trademark registration that are being processed by Dufry. Dufry licenses such trademarks to the company.
Competition
The company’s main competitors for airport concessions are Paradies Lagardere, HMS Host, WH Smith, Duty Free America, and DFS.
History
Hudson Ltd. was founded in 1987. The company was incorporated under the laws of Bermuda in 2017.
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