US: CVS Chain Ending Tobacco Sales

Source from:  CigarAficionado.com 02/11/2014

One of the largest drug-store chains in the United States is going to stop selling all forms of tobacco products, including cigars, before the end of the year.

CVS Caremark announced yesterday that it would eliminate cigarette, cigar and other tobacco sales at more than 7,600 stores by October 1. The public company gets some $2 billion annually from tobacco sales.

Most of those sales come from cigarettes. Stores such as CVS don't have walk-in humidors that contain the type of premium cigars found in brick-and-mortar stores, but they do a considerable business in cigars made by machine, and also in miniature versions of popular premium brands that don't require constant humidification. Calls to various CVS stores in the New York metropolitan area found the following brands currently stocked: Backwoods, Macanudo miniatures and Cohiba miniatures, Phillies, Dutch Masters, Muriel and Al Capone.

"CVS was one of our good customers for our value-priced Hampton Arms and Don Seville Nicaraguan handmades," said Eric Newman, president of J.C. Newman Cigar Co. "This is just the latest of so many challenges our industry in general, and our company specifically has experienced in our 119 year history-but we shall persevere."

Newman believes that the customer buying his or her cigar from a CVS today will simply find a new outlet for that same cigar, noting that when major drug store chains moved their cigar departments from the aisle to behind the counter years ago it cut cigar sales in those outlets while the customer moved to other retailers.

"This migration of customers helped give birth to the plethora of tobacco outlets that we see all over the country today," he said. "There is a CVS today virtually near every smokeshop in the country. What's going to happen to these CVS cigar smokers? Where are they going to go to find their favorite cigars? Should be to a local cigar shop or tobacco outlet. Most of our tobacconists have already added value-priced handmades like our Quorum to their product offering. And now with the budget-minded CVS cigar smoker forced to look elsewhere for his cigars, this ill-advised decision by CVS could very well be a shot in the arm for our brick-and-mortar retailers." Enditem