Selling Smokes Still Profitable

While foodservice sales are soaring, the tobacco category is still as important as ever.

I heard recently that the the profit convenience stores derive from foodservice has overtaken that of tobacco. Now I’m right there with the rest of the industry in joining the deli revolution, but that does not mean that I’m ready to throw tobacco out with the car wash water.

Philip Morris, R.J. Reynolds and Lorillard are doing much more with less and so can we. I’m reminded of the old saying, “make new friends, but keep the old, for one is silver, the other gold.”

Let me first say this—I personally have never been a smoker. The same holds true for alcohol and many other convenience store products, but as long as they are legal and my legal aged customers want them, I’m going to sell them because it’s our right to sell them responsibly, and it is the business I’m in.

Building Sales
While foodservice may indeed have taken the top spot, few among us would argue with the premise that tobacco continues to be a far easier and faster sale to make—with less of an investment required. Tobacco requires no additional labor to sell and infinitely less than a good foodservice program. Tobacco takes up far less space, is usually within arms reach and once your employees are trained to properly ID customers, it’s a pretty smooth transaction.

If we’re going to make our living, even temporarily, as a cashier, why not assist in maximizing our sales and profits by becoming better at selling it?

I’m still convinced that one or more of the new smokeless products, like Camel Snus is going to catch on and revolutionize the tobacco industry. Convenience store retailers must believe in the enormous potential of a product that can be used anywhere, anyplace and anytime versus one that cannot be lit or smoked at work, church, restaurants, sporting events and even in many homes.

Convenience store owners need to consider creating suggestive selling contests that reward employees for outstanding sales performances. Set goals, use graphs and other visuals to identify top performers and track progress. Above all else make it fun.

Be aware that different times and occasions call for different selling techniques, for example, how close it is to pay day. Thursdays through Sundays are prime opportunities for selling cartons and chances are you can save your customer $5 or more over the single pack price.

When a customer asks for a pack of smokes, train employees to focus on promotions. For example, instead of saying, “that will be $4.99,” have them say, “you save $1 on our three-pack special.”

Cashiers are the liaison between management and the customers. They are not fulfilling their mandate without informing customers about these money-saving specials.

Cross-Promote Effectively
Another factor to consider is associated products that can be sold along with packs and cartons of cigarettes, such as lighters. Training cashiers to say, “Can I offer you a lighter for those Newport’s today for only $1.79?” will increase sales of lighters and grow store profitability.

It doesn’t end there. Promote impulse sales by putting breath mints up by the cash register as a silent suggestive seller.

As for the future of the category, the time is now to lay the foundation for growing sales. As your customers order that three-pack Marlboro special, it’s the perfect time to explain snus to them for those times when they can’t light up.

It will take a lot of practice and patience to achieve success here, but the long term rewards of growing this segment will be enormous. Suggestive selling is, for most, an acquired skill, but it’s ultimately what could set you apart from the rest of the pack.

Jim Callahan has more than 40 years experience as a convenience store and petroleum marketer. His Convenience Store Solutions blog appears regularly on CSDecisions.com. He can be reached at (678) 485-4773 or via e-mail at jfcallahan502@msn.com.

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