Thursday, June 28, 2001

DFS to shut
Maui store

Retailer cites lower spending by
travelers from Japan as the reason
for closing its Kaanapali outlet

By Russ Lynch

DFS Hawaii, hurting from a drop in spending by Japanese visitors, will close its 11,400-square-foot store at Whalers Village, Maui, later this year, cutting about 30 jobs.

DFS Group The business notified the operators of the 110,000-square-foot shopping center at Kaanapali that DFS will not renew its lease and will vacate the premises by December, at the end of the current lease term, said Sharon Weiner, DFS Hawaii group vice president. Weiner said DFS could move out earlier if the shopping center finds another tenant.

Hawaii's tourist traffic from Japan has been down this year, with a dip of 3.3 percent in arrivals through the first four months. The average length of stay rose slightly, keeping Japanese visitor days even with last year at 3.3 million for the first four months.

But more important than the head count, Weiner said, is the fact that Japanese spending habits have changed and they spend far less in the islands than they did in the past. More Japanese are going to the neighbor islands this year but they are careful shoppers now and retailers say the Japanese may buy luxury goods for themselves but are much less likely than in the past to buy gifts to take home for others.

DFS has had the Whalers Village store since 1989. Most of it is a normal retail business, but a small part is set aside for selling duty-free goods to international travelers. Some of the employees will find jobs elsewhere in DFS Hawaii but some will be laid off, Weiner said.

DFS has close to 1,400 employees statewide. Its flagship retail business is the recently rebuilt DFS Galleria in Waikiki and it has other Waikiki outlets on Royal Hawaiian Avenue and at the Hilton Hawaiian Village Hotel as well as at Waikoloa on the Big Island.

The company also has the exclusive right to sell imported goods without duty or taxes to outbound international travelers and does most of that business in Waikiki and at Honolulu, Kona and Kahului airports. DFS pays the state Department of Transportation at least $60 million a year for that right.

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