Strong British brands, such as shoe retailer Clarks, often command a price premium abroad and are much more in demand in the UK where prices are much lower. British brands such as Burberry, Mulberry or Barbour and Church’s shoes, all carry a strong British heritage.
London is the second most valuable tax free destination after Paris, by amount spent. And while London attracts a huge proportion of tourist spend, other UK cities benefit too. Edinburgh, York and Bath are all popular, and Bicester Village in Oxfordshire has become a key destination for bargain hunting tourists.
To maximise the return from overseas visitors, retailers must offer DCC – Dynamic Currency Conversion. By offering tax free shopping to your customers, you offer them better value with no effect on product price, a significant advantage in a domestic market that is hugely promotions-driven.
While some retailers have some sort of offer for tax free shopping to attract lucrative global consumers into store, most are still not offering the full range of value added services such as MyCurrency TM, a dynamic currency conversion (DCC) solution that will attract higher footfall and higher spend, particularly for those customers who may be from within the EU and cannot offset the tax, but may still want to pay in their local currency.
Customers win twice – by getting the discount on brands that are otherwise more expensive in their home country; and, saving on the tax. Combined, this can make their purchases up to 50% cheaper. They also increase spend – a well-managed tax free service will encourage them to visit more often and spend more. For retailers, it is a valuable source of revenue that is not price-sensitive, enabling retailers to earn the full margin. Enables retailers to support investment in stores and stock even when local demand is depressed.
Anything the retailer can do to make the end-to-end process simpler and less time-consuming for the traveller, is going to increase their popularity as a destination for shopping.
The paperwork should be made as simple as possible for the consumers. This will allow them to see exactly what they are paying when they compile their expense reports.
Consumers should also be able to pay through multiple devices and services – traditional Point Of Sale (POS), kiosks, and mobile POS – payment methods that they are increasingly comfortable with and demanding.
About Geoffrey Barraclough
Geoffrey Barraclough has been Head of Corporate Propositions at Streamline/Worldpay since September 2012. He specialises in getting new business ideas to market.
At WorldPay hes focused on reducing the hassle of taking money with cards by simplifying the interactions between till, card machine and bank. Hes also looking at how WorldPay can help its clients take better business decisions with market insight derived from card transaction data. Geoffrey has been working in marketing for almost twenty years but began his working life as an economist.
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