Is Duty Free a Deal or a Rip-off?

anejo high-end tequilaI will admit I am a bit of a lush and I like to find a good liquor deal as much as the next guy trying to drown his sorrows or celebrate his sudden rash of good fortune. So I window shop at the duty free shop the way my wife window shops at New York City shoe stores: not buying much, but taking it all in and daydreaming about making that shiny hand-blown bottle of $100 elixir my own.

But I always have this nagging feeling that those screaming bargains aren’t really such a bargain. So I usually don’t buy much because I’m simply not convinced it’s worth the hassle, especially with all the pain-in-the-butt luggage restrictions these days. (If you buy duty free in one country and have a connecting flight in another, for example, you have to then stash that bottle in your checked luggage during the recheck. (Got room? Have the time to deal with it? Think the bottle won’t break in transit?)

But it’s only fair to compare, so I just completed my very own comparison shopping experiment. Yes, I looked a bit suspicious writing down prices in a duty-free shop and then looked suspicious again in my local liquor store, but that’s the life of a quasi-journalist. Here is what the sampling went for in Mexican airports and in the U.S. The result is as clear as a glass of Kahlua. All are 1 liter bottles unless indicated otherwise.

Bacardi Gold rum
17 duty free, 17 + tax at home

Sauza Hornitas Repasado Tequila – 100% agave
$17.50 duty-free, $27 + tax at home.

Bailey’s Irish Cream
$16 duty free, $18 + tax at home.

1800 Anejo Tequila – 100% agave – 700ml
$47 duty free, $33 + tax at home.

Kahlua coffee liquer
$12 duty free, $20 + tax at home

Crown Royal Canadian Whiskey
$38 for 2 duty free, $30 for one at home.

So, some items were a wash, some were clearly a better deal at duty free (especially true when there’s a 2 for 1 deal going on), and in the case of the most expensive item, the local liquor store was cheaper. Don’t draw a conclusion from that though: I saw a bottle of Reserva de Familia tequila—some of the nicest stuff that has ever passed my lips—for $85 at duty free and it goes for $120 to $140 in a lot of U.S. stores. And for some strange reason, good rum is always a good deal in Mexican duty free shops.

Keep in mind that this is a very unscientific survey based on a random batch of items in Mexico and Tennessee. The Cancun and Merida airports and a liquor store in Nashville. Do your own due diligence, but the moral of the story is that you need to know the price of whatever you are inclined to buy so you’ll know if it’s really a screaming bargain or just something that looks like a bargain to tourists in spending mode. If it’s not significantly cheaper, the hassle factor is far less just throwing a bottle in your car when you’re back on the home front.

And keep in mind where you are when you do your shopping. Duty free stores in Hong Kong and Tokyo are known to have the highest liquor prices in the world because they’re places where businessmen buy gifts to impress other businessmen and close the deal. Bourbon that costs $40 in the U.S. will go for $80 there and nobody blinks.

I also noticed that other items were an obvious bad deal. Cosmetics, chocolate, and cigars were noticably more at duty free than they were in any local store. An informed consumer scores all the deals. The clueless get taken for a ride.

2 Comments

  1. Kevin Koch 02/15/2009
  2. tim 02/16/2009

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