Booker CEO Charles Wilson said the tobacco trade had changed hugely over the last year and that the new tobacco legislation, which is only two days away, had caused endless confusion for independent retailers.
His comments came as he spoke about Booker’s financial results for the year ending March 24 2017.
Booker recorded positive sales growth, up 6.7% to £5.3 billion, but like-for-like sales to retailers decreased by 0.6%. Wilson put part of this down to the poor performance of the tobacco sector.
“Tobacco sales have been weak,” said Wilson. “If you look at the new legislation, in essence over 90% of the SKUs that an independent retailer sells have been banned in the last year. As of May 20, packs of 10 have gone, PMPs have gone – therefore the independents have seen far more change than even the multiples.”
Wilson’s comments came on the same day the Tobacco Retailers Alliance (TRA) claimed 60% of small retailers said that the introduction of plain packaging and the ban on small packs of tobacco were already having a detrimental impact on their business. In addition to this, 98% of small retailers felt that tax on tobacco was very high.
This week, tobacco manufacturer JTI’s undercover investigation into illicit tobacco found that one in eight retailers were selling illegal tobacco.
When asked about how the industry could clean up its act, Wilson said that Booker’s number one emphasis was to work with tobacco companies to get through pack changes and let everything else settle.
“Independents have taken one heck of a beating on tobacco and our job is to support them,” said Wilson. “The first thing is to get through May 20 and then that is a good time to make sure the trade cleans itself up.”