National tobacco shops further increase their share in FMCG sales

By: Tisza Andrea Date: 2024. 06. 18. 11:33

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FMCG sales by National Tobacco Shops exceeded HUF 187bn in April 2023-March 2024, growing by 13% compared to the previous period. This has put the tobacco shop sales channel in the 10th place in the annual ranking of the biggest retailers.

This article is available for reading in Trade magazin 2024/6-7

Andreas Christou
managing director
RetailZoom

Their sales revenue was generated by more than 205 million purchase transactions in the past 12 months, 4% fewer than the year before. Although the sales growth in the tobacco shop segment is exemplary, the growth dynamics seem to be coming to a halt: before 31 March 2024 the growth rate was 18%, in the period since then tobacco shop sales have grown by 12% on average.

Sources of growth

Unfortunately, the engine of sales growth for tobacco shops has also been inflation, i.e. steeply rising prices. However, while 90% of the sales increase realised by domestic retail chains came from rising prices, this “contribution” was only 70% for tobacco shops. The remaining 30% came from bigger shopping baskets (20%) and switching to premium products in the baskets (10%). Only 7 product categories accounted for around 87% of the non-tobacco FMCG sales in this channel.

Further growth opportunities

Successful implementation of innovations can lead to significant sales growth in this retail channel. Over the last 6 months new product launches have been responsible for around 14% of total sales and their weight is increasing. The optimisation of promotions is especially important: while only 32% of purchase transactions “landed on” promotional products in the previous period, this share grew to more than 40% in the last 12 months. //