In the last few years, tobacconist shop owners close to France’s borders have been complaining to government authorities about the drop in their purchasing power. Indeed, the rise in tobacco prices throughout France has caused many to purchase their cigarettes in neighbouring countries. Today, however, even tobacconists further from the borders are beginning to feel the squeeze in profits.
Valérie Marsalaud, president of the trade union chamber for tobacconists in the Haute-Vienne region, is worried about the drop in sales throughout her region. Last June, three of them had to close down due to financial issues.
According to Marsalaud, the reason isn’t because of lower consumption rates in France. Rather, she believes it is related to the spending habits of consumers. Many smokers have no problem crossing a border into Spain (500km from Limoges) to purchase dozens of packets of cigarettes. Other smokers prefer finding cheap cigarettes online.
Diversification in order to survive
In the past, tobacconists were able to maintain significant profit margins thanks to the sale of additional products, such as candies and magazines. Today, however, they are seeing fewer customers due to the rise in cigarette prices. As a result, each time the price of cigarettes is increased, tobacconists lose money.
Numerous tobacconists have tried to adapt to the dramatic drop in cigarette sales. Techniques include diversifying products and selling electronic cigarettes and e-liquids. But the competition with specialist boutique vape stores is fierce, and while there are no regulations for the marketing of e-cigarettes, the sale of tobacco is subject to strict administrative restrictions. What’s more, many tobacconists don’t have enough cash to invest in new vaping products.
The closing of tobacconists throughout France is quite problematic, primarily in small villages where the tobacconist is also a place for the community to gather and maintain strong social connections.