Plain Packaging Proving Bad For Retailers’ Health

MEDIA RELEASE
February 10, 2013

Plain Packaging Proving Bad For Retailers’ Health

As New Zealand considers the merits of tobacco plain packaging the early signs from Australia, which only recently adopted the reform, are less than encouraging. Smokers continue to light up and the volume of tobacco sales remains consistent, yet retailers have been left to bear the burden of increased administrative and labour costs.

According to feedback from members of the Australasian Association of Convenience Stores (AACS), while plain packaging is unlikely to encourage customers who smoke to quit in the medium term, the ramifications for Australian retailers has seen several brands go out of stock or become unavailable during the changeover.

This has forced smokers to change their purchasing habits and has negatively impacted smaller retailers in particular.

AACS Executive Director Jeff Rogut said that, while the volume of tobacco sold has not been impacted by the plain packaging reforms, the cost burden on individual retailers has escalated.

“In most cases stores reported that the transition to plain packaged stock has involved a significant investment in time and money. Re-training staff, preparing stock returns and implementing new inventory management procedures are just some of the administrative burdens retailers have had to face,” Mr Rogut said.

“Additionally, while tobacco suppliers have been generally supportive in swapping non-compliant stock for plain packaged stock, the fact that there has been no uniform process for retailers to be fully compensated for old stock has added to this burden.

“One multi-site convenience operator reported being left with a total of $180,000 in unsaleable stock. The fine for an individual operator selling any branded stock after December 1st 2012 is $220,000.

“Store operators have also bemoaned the lack of support and education from Government and its refusal to even acknowledge retailers’ genuine concerns in the lead up to the changes,” Mr Rogut said.

Plain packaging has also created difficulties for staff when identifying tobacco products leading to increased transaction times, which is at odds with the convenience offering.

According to AACS members, plain packaging has had no impact on the volume of tobacco sold and therefore has not generated any positive health implications thus far.

“This is unsurprising given there was never any evidence to suggest that plain packaging would impact levels of tobacco consumption. Instead, it merely serves to create additional burdens on retailers while encouraging the illicit trade of tobacco,” Mr Rogut said.

“As many have previously pointed out, education is the key to improving health outcomes as they relate to smoking,” he added.

ENDS

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