Stick to RRPs to prevent your tobacco sales going up in smoke, says Bestway

Bestway is advising retailers not to stray from the recommended retail prices on tobacco products when price-marking is removed from packs.

The wholesaler has launched a guide to the tobacco category to help retailers protect their sales following the introduction of the EU Tobacco Products Directive 2.

It said as many tobacco manufacturers are reducing or stopping their supply of PMPs into the trade, which could create confusion on retailers’ pricing strategies. The best way for retailers to protect their tobacco business, it added, is to preserve current manufacturers’ RRPs to maintain the confidence of smokers.

Many retailers use several wholesalers to make sure they get the best prices – why do they think smokers would behave any differently if they increase the cost of tobacco

Tony Holmes, Bestway

“Smokers are an important customer group for convenience store operators. They visit stores more frequently and spend more than double that of non-smokers,” said Tony Holmes, sales director for retail at Bestway Wholesale. “It is imperative that following the removal of price-marking, retailers take the necessary steps to protect their tobacco sales.”

He added that if retailers choose to inflate prices to earn additional margin, they could see a decline not only in their tobacco business, but also across other grocery and impulse categories as footfall will fall.

The advice followed research from Australia, which found retailers that stuck to RRPs saw no discernible impact on their tobacco sales. “Many retailers use several wholesalers to make sure they get the best prices – why do they think smokers would behave any differently if they increase the cost of tobacco?” he said.

Bestway will offer 10-packs and PMPs for as long as they are available from manufacturers to help retailers meet the needs of their customers.

The eight-page leaflet entitled ‘Don’t let your tobacco sales go up in smoke’ is available from all Bestway and Batleys depots from June 16. Best-one and Xtra Local business development executives will also be distributing the brochure to symbol and club members.