Pricewatch 03 August, 2018 - Cigars

Analysis

This week’s most popular price point for a 10-pack of Hamlet Fine cigars, according to our Profit Checker graph, was Booker and Bestway’s £11.35 RRP – an option chosen by 29.6% of stores. 

For those which chose alternative prices, the preferred option – chosen by 51% of retailers – was to charge above RRP, in some cases by more than 75p. The trend is echoed in the Price Checker table, with 28 prices above RRP and 11 sticking to it. 

The overall trend favoured higher margins, with the average selling price for 10 out of 12 products above Booker’s RRPs for cigars.

Profit checker

PRICE Price distribution %

Price checker

CIGARS AVERAGE UK SELLING PRICE BOOKER RRP NORFOLK VILLAGE POST OFFICE AND STORE POST OFFICE IN OUTSKIRTS OF EDINBURGH SHOP IN NORTH DERBYSHIRE HIGH STREET CORNER SHOP IN RESIDENTIAL BIRMINGHAM SUBURB NEIGHBOURHOOD IN RESIDENTIAL AREA OF LARGE HAMPSHIRE TOWN C STORE IN CENTRAL SCOTTISH VILLAGE
CAFE CREME BLUE 10 PACK £5.79 £5.69 £5.70 £5.71 £5.78 £5.70 £5.69 £5.85
HAMLET FINE 5 PACK £5.85 £5.75 £6.10 £5.85 £5.75 £5.75 £5.80 £5.95
CASTELLA CLASSIC FINE 5 PACK £6.35 £6.27 - £6.35 £6.47 £6.30 £6.35 -
CAFE CREME ORIGINAL 10 PACK £5.78 £5.69 - £5.71 £5.78 £5.70 £5.69 £5.45
HAMLET MINIATURE 10 PACK £5.55 £5.40 £5.70 - £5.40 - £5.50 £5.95
HAMLET FINE 10 PACK £11.42 £11.35 - £11.10 - £11.05 - £10.90
HENRI WINTERMANS HALF CORONA 5 PACK £10.66 £10.59 £10.59 - - - - £10.99
PANAMA THIN PANATELLAS 6 PACK £6.21 £6.10 £6.20 - £6.30 - £6.15 -
CAFE CRÈME RED FILTER 10 PACK £5.75 £5.69 £5.70 - £5.69 £5.70 £5.65 -
HAMLET MINIATURE 5 PACK £2.85 £2.75 £3.15 - £2.75 £2.75 - £3.00
MOMENTS BLUE 10 PACK £4.44 £4.50 - £4.97 - - - -
ROYAL DUTCH MINIATURES BLUE 10 PACK £4.61 £4.79 - £4.79 £4.79 - - -
Data supplied by
Data supplied by

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How we drive our profit

Martin Ward Avatar

Martin Ward

Cowpen Lane News

Location: Billingham

Size: 441sq ft

Type: suburban

Top Tip
Keep cigars in an area which can raise awareness of the products within your shop
We charge the charge the RRP on cigars and we tend to sell the equivalent of an outer of the products every six weeks. I normally place cigars by the till just to make sure customers are aware we sell them. We have a couple of regular customers who come in and buy cigars. One of them tends to buy a box for himself. Our other regular customers are workmen who will usually buy a single if they’re having a bad day at work. Cigars are a specialist category and demand isn’t as high as cigarettes or rolling tobacco.
Joe Williams Avatar

Joe Williams

The Village Store

Location: Hook Norton

Size: 1,200sq ft

Type: village

Top Tip
Cigars are a specialist category with a concentrated audience, so listen to customers
We normally add 20p to 30p on top of Blakemore’s RRP to get average margins of 15%. Cigars are a specialist category and we face competition from a specialist tobacconist based six miles away. The products we stock, which are Café Crème Blue and King Edwards, are determined by customer demand. We don’t want to waste money by having stock which doesn’t sell. There were times where we bought stock which didn’t shift at all. The cigars in my shop tend to be purchased for special occasions by customers who are over 40.
Mital Morar Avatar

Mital Morar

Ancoats General Store

Location: Manchester

Size: 3,000sq ft

Type: city centre

Top Tip
As the cigar category is more specialist, make sure you stick with products you know will sell
The cigar products I stock in my store are Hamlets and Henri Wintermans. I charge RRP and usually get average margins of between 10% and 15%. Cigars are a specialist category and there tends to be less demand than rolling tobacco or traditional cigarettes. The customer base is older and more affluent in comparison to our regular audience of millennials. They normally buy the products for special occasions. We make sure to stock products we know will sell because otherwise we’d be losing money by having stock sitting around.
Jack Matthews  Avatar

Jack Matthews

Bradley’s Supermarkets

Location: Quorn

Size: 2,600sq ft

Type: residential

Top Tip
Keep your cigar range tight and make sure you stock the bestsellers in the category
Cigars aren’t as big of a seller as cigarettes or rolling tobacco for us, so we normally stick with the recommended range of products. The selection of cigars in the shop includes Café Crème, Hamlet Miniatures and Panama. We stick to RRP, which gives average margins of 5%. The customer base for cigars is more concentrated among the older generation and we have a few regulars in this age range who consistently purchase cigars. It is important to really work out what the bestsellers are and stick to them.

Find out more about RN’s definitive guide to the best-selling products that you need to have on your shelves.

Read more

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