DFS Group to close Saipan operation as restructuring continues

The Saipan closure brings the curtain down on an extraordinary act within the long-running DFS story. For DFS not only pioneed duty-free retailing on the island, it also funded the airport.

Feb 19, 2025 - 16:34

DFS Group to close Saipan operation as restructuring continues

NORTHERN MARIANA ISLANDS. DFS Group is to close its operations in Saipan on 30 April after nearly half a century of operating on the island.

The LVMH/Robert Miller-owned travel retailer has a dual downtown and airport business on the island, the capital of the Northern Mariana Islands (an unincorporated territory of the USA in the western Pacific).

The closure, widely anticipated, is in line with the company’s wide-ranging strategic restructuring and operational streamlining outlined by DFS Chairman & CEO Ed Brennan in an exclusive interview with The Moodie Davitt Report last November.

**DFS is set to bring down the curtain on a remarkable, half-century success story in Saipan amid increasingly challenging trading conditions {All photos: DFS Group}**

“After more than 40 remarkable years in Saipan, the DFS Group has made the difficult decision to close its operations,” the travel retailer said.

“This closure is the result of challenging economic conditions, compounded by the departure of luxury brands, which have significantly impacted the stores’ appeal and profitability.

“Despite our best efforts to continue the operations, the circumstances around the current landscape have made it unsustainable to continue. The decision is also part of DFS’s broader strategy to streamline our global operations and refocus on key, profitable markets in Asia.

“DFS Saipan will remain open until April 30th, 2025, Wednesday. During this transition, our utmost priority is to support our dedicated team, whose commitment has been the heart of our success. We are immensely grateful for their hard work, passion, and contributions over the years.

“We also extend our heartfelt gratitude to the Saipan community, our customers, and partners for their trust and support over the years. Serving this community has been a privilege and an honour, and we are proud to have been part of so many celebrations, milestones, and memories in the lives of our customers, whose loyalty and support have meant more to us than words can express.

“Until the very last day of operations, DFS remains dedicated to providing the exceptional service, quality, and experiences that our customers in Saipan have come to know and value. We will continue to foster the relationships we have built over the past four decades and ensure a seamless and respectful transition for our employees, partners, and the community.” {Main story continues below the following sidebar}.

From war pilgrimage destination to DFS boomtown

The Saipan closure brings the curtain down on an extraordinary act within the long-running DFS story, writes Martin Moodie.

After DFS – then heavily Japanese-focused and majority-owned by Robert (Bob) Miller and Charles (Chuck) Feeney, alongside minority partners Alan Parker and Anthony (Tony) Pilaro – opened in nearby Guam in 1971, the company checked out the opportunity in Saipan.

“If Guam was in its infancy as a tourist destination, the Northern Mariana island of Saipan, 135 miles closer to Japan, was still in the womb,” I wrote in Miller’s Tale, my 2022 biography of Bob Miller.

However, the island had become a place of pilgrimage for Japanese citizens wishing to honour the near 30,000 war dead from the Battle of Saipan in 1944. The island only had an ex-World War II unlit coral airstrip and a hotel-based downtown-free shop described as “slightly larger than a telephone booth placed sideways”, run by Guam-based US businessman Kenneth Jones.

DFS was about to go one better. Much, much better. Pilaro flew in to meet the local government authority, offering to fund a proposed new US$3.25 million airport. In return, DFS landed a 20-year, duty-free, specialist retail and food & beverage (without any concession fee), its investment recouped in the first year of trading.

On 25 July 1976 Saipan International Airport, replete with a swanky DFS shop, opened for business, to be followed by a DFS downtown store in Garapan.

By the end of the decade over 100,000 Japanese were flying direct to the island. At its peak in the late 1990s, the number would reach 450,000.

The halcyon days of Japanese travel shopping are, alas, long gone. As indeed are those of Japanese visitors to the island.

According to the Marianas Visitors Authority, arrivals to Saipan (and the nearby small islands of Tinian and Rota) totalled just 19,598 in December 2024, of which South Korean travellers represented 14,186, Japanese just 1,886 and Chinese a mere 1,143. Prior to the pandemic, China was the second-largest source market of visitors to The Marianas with multiple direct flights a week from five cities. Any comeback seems a long way off.

A cornerstone of the community departs

The closure is big news within the tight-knit Saipan business community, of which DFS has been an integral part for half a century.

Commonwealth of the Northern Mariana Islands (CNMI) Governor Arnold Palacios said in a statement: “In conversations with managers at DFS on Guam and Saipan, the company is implementing a corporate strategy that addresses challenging economic situations that DFS and the travel retail sector have been facing globally.”

He added: “While the decision to close may be part of DFS’ broader strategy to streamline global operations, there is no denying the impact here at the local level.

“That’s because DFS has been more than just a business that has contributed to the economic and workforce development of our islands; it has been a cornerstone of our community that’s touched the lives of generations of families here in the Commonwealth.

**DFS has served Saipan International Airport – and the Saipan community – with great distinction since 1976**

“DFS was always there to offer philanthropic support with in-kind contributions, financial donations and community service. For many, DFS is where they got their first job, and for some, their lifetime career. For others, it’s where they shopped year-round to buy gifts for family, friends, and colleagues. And for our entire community, DFS brought world-class luxury with innovative and creative displays and spaces, exemplary customer service, and the warm Hafa Adai atmosphere we were all welcomed with.

“We express our sincere gratitude to DFS owners, management, and all their employees for their long-standing contribution to our community here in Saipan.

“While we acknowledge this closure with a heavy heart, we see it as an opportunity to create new avenues of economic growth. We are committed to working with local and international partners to attract new investments that will not only fill the void left by DFS but also bring innovative and sustainable business ventures and jobs to our islands.”

Commenting on DFS Group’s departure from the airport, Governor Palacios said: “To prepare for the transition, we have also begun initial discussions with CPA [Commonwealth Ports Authority] to ensure the traveller experience at Saipan International Airport remains top notch with minimal impact. CPA will ensure the floorspace currently occupied by DFS remains accessible and inviting.”

He added: “The departure of DFS underscores the CNMI’s need for us to diversify our economy and not solely rely on one industry. We are actively seeking partnerships that align with the vision for sustainable development.

“This includes improving and modernising infrastructure, diversifying the CNMI tourism source markets, leveraging military development into other spin-off industries, expanding our digital and telecommunications services, and cultivating other sustainable industries that will bring economic growth and sustainable jobs for our people.

“That is why we continue to work closely with and attract businesses and investors who share the vision for a vibrant, sustainable and resilient CNMI,” Palacios concluded. “This is not just about filling a retail space but about elevating our entire island’s offering.”