Illegal tobacco, rising cigarette prices dent supermarket profits
Carrie LaFrenzSenior reporter
Key Points
- Why it matters: rising prices and illegal imports are hurting cigarette sellers
- Metcash faces the biggest impact given tobacco accounts for 15 per cent of sales
- Some 1.1 billion illegal cigarettes were seized in the year to June 30, 2022
Australian supermarket sales are being squeezed by the growing illicit tobacco trade with independent stores, led by Metcash’s IGA network, describing the “huge problem” as their single biggest issue.
Tobacco is somewhat inconspicuous in supermarkets, but it has had a meaningful impact on sales and margins given demand has dropped significantly in the past year.
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