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Could the impact of plain packaging for vapes impact retailers’ bottom line?

Following on from this morning’s call from British American Tobacco (BAT) to retailers to submit their opinions on the upcoming changes to vape packaging and the rules around tobacco, campaign group We Vape has now also joined the call, highlighting some disturbing figures about the proposals along the way.  

It said the plain packaging plans for vapes could cost retailers more than £330m - with no estimate of any benefit, the group has warned.

Figures from the Government’s own impact assessment show its proposed restrictions on vape packaging, appearance and displays will hammer profits of retailers, wholesalers and manufacturers. Proposals include plain packaging, limited device colours and flavour names, and the move to keep vape products out of sight in shops.

However, in a worrying admission, the report concludes due to “evidence limitations” on vapes, officials cannot provide a Net Present Social Value - the standard measure of whether a policy’s benefits outweigh its costs.

Meanwhile, just £100k has been allocated to enforce the new rules at 76,000 outlets across the UK, We Vape found - equivalent to just £1.32 per shop.

In response, the group is joining BAT in urging business owners and supporters to complete the government public consultation into the plans and make their views known.

“This is the worst of both worlds…”

Founder, Mark Oates (left), said: “This is the worst of both worlds. The Government is hitting retailers with a £330m cost while setting aside just £100k for enforcement - £1.32 per shop.

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“They cannot even say if the policy will deliver any benefit to society. That’s not evidence-based policymaking. Restricted flavours and plain packaging risk reducing awareness of the products that help adult smokers switch, while high taxes are already driving people towards the black market and illicit cigarettes.

“Children are already protected by the under-18 sales ban. The real issue is enforcement. Therefore, Trading Standards needs proper resources to tackle illegal sales, not new burdens on legitimate shops.

“We urge every retailers and vapers to respond to the consultation before it closes on 2 October.”

The Government assessment estimates £328m in lost profits for retailers, wholesalers and manufacturers, plus £2.8m in one-off familiarisation costs for around 76,000 UK retailers that sell vapes.

Meanwhile, the impact assessment also acknowledged officials used 12-year-old cigarette data to formulate plans. It states its 1.9% projected reduction in vaping “is not drawn from vape-specific evidence, but carried over from the impact of the 2015 standardised packaging regulations for cigarettes.”

It admits there is “very little evidence regarding interventions that target the appearance of the vape or heated tobacco device itself. The UK will be amongst the first countries in the world to attempt this approach.”

The report does not include lost profits for heated tobacco manufacturers, which the Department of Health and Social Care said it could not quantify.

The plans form part of the secondary legislation expected under the Tobacco and Vapes Bill, which is designed to give ministers wide-ranging powers over the packaging, appearance and display of all nicotine products.

For full details and how to respond to the public consultation click here