Profits up in smoke

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Hands up all those who sell tobacco at the recommended retail price? A retailer from West Yorkshire who wishes to be referred to just as Mr Singh (I think because of the debate he’s been having at the cash and carry) asked if you can charge for cards when customers are buying only cigarettes. The situation was even worse in the summer, he says, when people would send their kids in with cards just to buy a few sweets. Some of the other indies he regularly sees have said that you can charge extra to cover the cost of the transactions.

Not true Mr Singh… tell your mates.

He says: “I am losing money when I sell cigarettes at the rep’s rrp. I might as well give them away.”

The rep had suggested he make up the difference by putting a few pennies here and there on other goods. He adds: “But I don’t stock 60,000 lines that I can put a penny on. And so much is pricemarked.”

It’s not the first time this subject has been raised this year – ever since the new EU directive came in saying retailers can no longer charge for taking cards (except for cashback).

I spoke to about a dozen retailers in the summer and found that not a single one sold at the rrp. The usual amount they added was between 20p and 50p.

I told him I would ask through this column whether there is anybody out there selling at rrp and, if so, why?

Readers' comments (3)

  • I sell at RRP in the hope that it brings back regular customers and hope that they buy something else when purchasing with a card. I do have a £3 minimum spend on card and Payzone transactions are cash only.Hopefully by pre-Budget buying will enable everyone a little boost on the cigarette margins for a while.

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  • I still sell cigarettes at rrp. What can one do when I’m surrounded with grocery shops, barbers and even chip shops selling foreign and fake cigarettes.
    However I will not sell cigs only on card payment unless it’s with a £3.00 minimum purchase in shopping.

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  • I refuse to sell anything at rrp I have a Tescos,Spar, Farm foods and Morrisons within walking dist. Mybiggest gripe iswith paypoint I lose money with bank charges, charges for machine hire, phone line charges and charges for till rolls.

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