Duty-Free Shopping Not Always A Bargain

The image is a staple of international travel: The crowd of weary, unwashed and unshaven travelers exits customs after a long trans-Atlantic flight, pushing luggage carts filled with baggage. Dangling from the carts are plastic satchels embossed with a foreign airport’s logo and holding a carton of duty-free American cigarettes, bottles of Scotch or French perfume.

In recent years duty-free shopping has become a leading source of profit for the world’s major airports.

While the shops are beginning to offer as many items as the local Price Costco warehouse, don’t expect the savings to match. European travelers, long used to high prices on many consumer goods, may realize savings by shopping duty-free, but more often than not Americans won’t.

In an informal survey this month at several major European duty- and tax-free shopping areas, prices of a wide range of products were virtually identical to or even higher than those in ordinary shops in the United States, even after state sales taxes are factored in.

Although currency-conversion rates could always alter the equation one way or the other, in the worst examples duty-free prices were as much as 50 percent higher than those found in American discount retail stores.

For example, that quintessential duty-free product, a carton of Marlboro cigarettes, costs the equivalent of $20.15 at Heathrow Airport near London (at $1.55 to the British pound), $21 at Milan’s Linate airport (at 1,525 lire to $1), $19.40 in Amsterdam (at 1.65 guilders to $1) and $18.40 (including sales tax) in Von’s supermarket in Los Angeles.

Dixon’s duty-free camera shop at Heathrow charges $105.52 for the Windows 95 upgrade program; at J&R Computer World in New York City, it costs about $97.

Sony’s Discman model D-141 goes for $118.71 at Heathrow and $170 in Milan; but Circuit City in Los Angeles charges $69.95 plus 8.25 percent tax. Philips’s top-of-the-line electric shaver, the Philishave 990, costs $169 in Amsterdam’s duty-free shop and $157 at Heathrow. The similar top model in the United States, the Norelco 985, can be easily purchased in discount stores like Caldor’s for $119 plus tax.

Even home-grown items do not always cost less in their country of origin. While Crabtree and Evelyn orange marmalade is a saving at Heathrow ($3.90 compared with $6.50 in the States), whisky, on a unit-price basis, is often not. For example, a one-liter bottle of Johnnie Walker Red is available at Heathrow for $17.45; but a 1.75 liter bottle of the same Scotch would cost $24.35 at Price Costco - 1.7 cents per milliliter compared with 1.4 cents in the States, or about 18 percent less here at home.

In Italy, you’ll save on Cinzano: $4.60 for a liter, compared with $9.17 a liter in the United States. But Milan’s Linate airport duty-free shop charges $44.60 for a 100-milliliter bottle of Armani after-shave, $4.55 more than the United States department store after-tax price of $40.05.

Although duty-free shops may not offer significant savings to American travelers, there is no question that, in Europe especially, they are offering more merchandise these days. Despite the lack of savings, the space given to duty-free shopping areas in European airports has increased drastically; within a few years, based on construction plans, the same will happen in many United States airports. While Americans save little or nothing by shopping this way, airport officials have correctly surmised that a wide range of goods and an attractive store will draw crowds who are waiting to fly home.

Duty-free operators never claim to offer the world’s lowest prices, only the lowest prices in their country, which to an American may not mean much. If you’re dissatisfied with your purchase, Heathrow has a no-questions-asked money-back guarantee (including shipping costs).

Official policy at Amsterdam’s Schiphol Airport is that it won’t take items back if a customer is dissatisfied with the price, but Liesbeth Mahieu of the airport’s Terminal Commercial Services office said that if customers believe they were overcharged, they can get a refund. Also, Schiphol’s stores will repair any item that is not covered by customers’ warranty.

Paris offers nothing of the sort. “There’s no way we can compete with American prices, and we don’t give refunds,” said Jacques Reder of the Paris airport authority.

There are other reasons to shop duty-free. The chance to buy goods unavailable at home, the convenience of getting rid of loose foreign currency and the lure of picking up a last-minute gift may override the fact that for Americans, bargains at duty-free shops are few and far between.