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Small Stores Must Plan Ahead for Declining Tobacco Sales

As a teenager I tried really hard to be a smoker.  In the sixties it was cool to smoke. The Beatles, Stones and Dillan did it. James Bond and all the major film stars smoked.  Other than not being a professional footballer Bond was all the things that me and my mates aspired to be. But try as I may I couldn’t get on with smoking – even tried menthols. My asthma seemed to get in the way.  I did however; master the art of beer drinking. That’s another story.

Fast-forward to 2017 and times have changed beyond recognition. Smoking is a very bad idea and government legislation across Europe is bearing down heavily on the consumption of cigarettes.  Sales are now inexorably declining in value and volume. Booker Wholesale’s latest trading results show a 7% decline.  I don’t know but I can’t imagine they’re too worried about that. Tobacco is a low margin category albeit good for cash generation. Booker has long been on a course to reduce dependency on tobacco while building sales of other categories – notably fresh foods.

The tobacco suppliers would argue that they have invested strongly in the industry over the years, enabling the small independent stores to drive footfall. And they’d be right.  But in so doing they’ve lulled the industry into a false sense of security.  Look what happened to pubs when smoking was effectively stopped overnight. Many went to the wall and the decline is still happening. This fate awaits the small stores and the wholesalers unless they take steps now to build sales in other areas of goods and services. 

Here’s my list of possible steps to take to head off declining tobacco volumes.

  • Remove cigarettes from behind the till and sell more attractive merchandise from that prime selling space. Suggest OTC medicines and food supplements.
  • Sell tobacco from under the counter.
  • Take vaping seriously by adding the best sellers.
  • Add categories that will drive footfall and frequent visits to the store.  Coffee and food to go are the obvious choices
  • Parcel pick-up services
  • Add new categories to ranges. A big growth area is food supplements. Another is OTC medicines which (by the way) would work well from behind the till.
  • Add a range of post and parcel wrap products (best sellers) without actually becoming a full-blown post office.  This plays to the sell from home (ebay) consumers.

There will of course be many more opportunities tuned to local market dynamics. Let's share our thoughts and pool our collective intelligence.

 

David Gilroy

Store Excel

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