Autumn arrived in tobacco retail too
The summer months weren’t bad at all in tobacco retail if we look at value sales. Although Trafik.hu partners’ sales data suggest a 2-3 percent drop in August, HUF 45-50 million sales are rather likely to have been realised. But the autumn brings several questions for market players to answer. One of these is: will the growth of the last few months come to a halt?
Declining value sales of key market players influence the size of the market in total. Consumption trends that developed in past months stayed unchanged. Tobacco companies also count on these trends to remain stable. The shares of individual product categories seem to have stabilised recently, too. This can also mean that consumers have accepted the price increases of the recent past. Philip Morris holds on to its leading position. BAT is firm in the second place after the relatively weak performances in Q4 2013 and Q1 2014. In the last few months Imperial managed to overtake JTI, mainly because in the expanding RYO category it was able to preserve its leading position. Good news for Trafik.hu partners: sales of their non-tobacco products have augmented in recent months. As for the autumn period, we can expect gloomy months in tobacco retail. Manufacturers continue to reduce the frequency of product deliveries, which will entail increased stock management work and costs for tobacco shops. The market leader has announced that it wishes to change earlier contract conditions. Sales experiences from recent years also suggest that a sales drop might occur in the autumn period. All of these factors may quickly bring an end to the relative ease of summer months and put many tobacco shop owners in a difficult situation once again.
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