Graham Barney is all in favour of PMPs. He writes from Winifred Way Stores at Caister on Sea in Great Yarmouth: “I don’t understand why retailers get upset at pricemark packs. There is nearly always an unpriced alternative, although the wholesalers and manufacturers do premium price these as they are aware that many retailers will premium price them, and they want to encourage us to buy pricemarks. That’s fair enough.”
He acknowledges that every store is different. “I have a neighbourhood store with the same local customers every day. I use pricemarks to give my customers confidence that they are being charged a fair price.
“With cigarettes, I have always used pricemarks at the value end, and unpriced for the premium (charging about 6p above rrp for 20). Recently with large increases (up to 50p/pack) from the Budget I have moved to PMPs wherever possible.”
This ploy enabled him to keep to pre-Budget prices for two months when all the multiples had increased, thereby winning many customers from them.
“When new PMPs come through my customers can see that it is not my price increase, and are confident that I don’t rip them off. My tobacco sales for May increased by 17%, and my profit by more than 25% over 2010 although smokers changing to RYO, and higher margin own-label value cigarettes, may well account for much of this.”