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El Original
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Sell SMOKE Magazine!
August/Sept.
1999

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Smokeshop Industry Report
(page 3)


Membership-only clubs showed a significant decline from last year's survey, with only 10% reporting such services in 1998 compared to 15% in 1997. Average dues among stores with clubs was $245 annually.

Walk-in humidor are installed in 78% of the surveyed shops, with an average of 246 SKUs (store-keeping units, or frontmarks) on display.

Retailers reported an average of 1,323 weekly customer transactions. Non-tobacco transactions accounted for a five-year low among surveyed stores at 30%.

A growing number of tobacco retailers have embraced the Internet to market their stores and expand their sales opportunities. While 12% of responding shops had basic, informational websites that listed no merchandise or prices, the largest segment of retailers, 14%, had websites listing merchandise and their accompanying retail prices. Another 12% had provisions for placing orders online through their webpage, while 4% reported highly advanced sites featuring online catalogs and realtime inventory updates, allowing consumer to automatically know whether items are in stock when placing their order.

Only a hold-out 9% of stores do not accept credit cards, while 12% offer customers some form of revolving house account priviledges. A vast majority of store, 91%, accept Visa and MasterCard. Only 16% of stores accepting credit cards require a minimum purchase for customers to charge purchases.

Mail order catalogue operations were reported by 12% of responding stores, contributing an average of $16,587 to each store's annual sales.

While formal cigar dinners may have fallen in popularity over the past year, overall cigar events - whether in-store or offsite - remain common forms of promotion, with retailers reporting an average of three events last year. Overall, a shrinking 36% held no events at all, down from 47% in 1997.

Newspapers were the most common form of store promotion, where 68% of stores placed some form of advertising. Radio was used by 43% of stores, followed by direct mail (42%) and magazines (21%). In addition, 21% create their own newsletters, while 14% saw no need for any advertising at all. Over 40% reported using advertising venues other than the choices listed.

Membership in associations of some type was prevelent among retailers, with the Retail Tobacco Dealers of America (RTDA) commanding an impressive 96% membership rate among the respondents. In addition to the Tobacconists Association of America (TAA) which accounted for 13% of responding stores, 6% of stores reported membership in the International Tobacco Association (ITA). Overall, 11% of stores belonged to additional associations such as Friends of Tobacco, or state-level ones including the California Association of Retail Tobacconists, (C.A.R.T.), Oregon Tobaconist Association, and the West Virginia Wholesale & Retail Association.

The average number of full- and part-time employees per store rose in 1998, both averaging 2.4 per store for a total of about five employees total.

Lavish employee benefits are often a financially difficult option for small, independent retailers, as is reflected by the 57% of responding stores that offer no benefits at all. Group health insurance is offered by 51% of stores, retirement savings by 11%, and longterm disability by less than 2%.

Tracking the Trends? Click Here to view last year's Industry Report.


SMOKESHOP - August/September 99

Sell SMOKE Magazine!