nickshanagher

It is a Catch 22 situation. The margin on a pack of premium cigarettes sold at recommended retail price is overwhelmed by the sheer size of the government's tax take to the point where some retailers say they cannot borrow money cheaply enough to cover the cost of their stockholding. Using a pack of Lambert and Butler as an example, Amal Pramanik, general manager of Imperial Tobacco UK, told wholesalers last week that 81 per cent of its £7.19 selling price was taken in excise duties and VAT, leaving just £1.42 to be shared out by the manufacturer and retailers. On value brands, the government was taking as much as 88 per cent of the selling price. Well aware that retailers are criticising his company for the low margins, Mr Pramanick says that retailers should look at their margin against the net sales price after stripping out government duty. On L&B this works out at 37p, which has increased by 33 per cent over the past five years. It is a tiny 5.1 per cent margin on the ...

"We're just fooling ourselves if we think that the staff at Tesco Express can't smile or be pleasant. We've got to be much more than just nice people," an un-named retailer tells wholesaler Menzies Distribution as part of its major research exercise to better understand its customers. David Cooke, its commercial and marketing director, writing in InPublishing warns publishers - particularly magazine publishers - that they risk losing a large and successful route to market. Why? His analysis splits the independent retailer universe into four types: entrepreneurs, who are doing well and join everything, always looking for better ways to do things and will pick up tips and tactics from wherever they can get them. They can compete with the multiples but they are prepared to cut out a category if they felt they would have a better or more profitable business by doing so traders, who mainly have one shop, know what they want to do but do...