LONDON -- As Great Britain enters its second month of implementing a “plain packaging” rule on all cigarettes sold, critics say an unintended consequence may be the rise in black-market activity, according to The Economist.
The rule, which went into effect May 20, says cigarettes can only be sold in cube-shaped packages of a single color, with a flip top rather than hinged lid and all lettering in a uniform font. It’s a rule that emerged out of Australia in 2012 and caught on in France, Ireland and now the United Kingdom. Lawmakers have yet to enact similar legislation in the United States.
Opponents say the rule can make contraband product difficult to spot, making selling of those illegal cigarettes easier, the news source said.
But to substantiate any claims as to the growth of black-market trade, researchers will need to track the effects of the new rule. Editors at the London-based Economist asked Hanna Ross, principal research officer at the University of Cape Town in South Africa, to offer ideas …
While researchers can use many methods, Ross named three. The first is by taking records on cigarette taxes paid and comparing them to consumer surveys on cigarette consumption.
The gap between the statistics reveals an estimated share of the black market.
A second method is to ask smokers direct questions about what they smoke. Questions include where they buy their cigarettes and how much they pay, but researchers may also ask users to show a recent pack they bought. Ross said that smokers may openly admit they purchased product from the black market.
A third way is to count discarded cigarette packages found on the street, in trash cans or dumpsters. Contraband cigarette packages show tell-tale signs, such as not having tax stamps or being labeled with an unregistered brand.
These methods still have weaknesses, Ross said. Smokers may be reluctant to say they’ve bought illegal cigarettes or may lie about how much they smoke. The trick is to apply multiple methods, she said.
To identify trends, Ross suggested using the same method in multiple studies over an extended period of time.
Get today’s need-to-know convenience industry intelligence. Sign up to receive texts from CSP on news and insights that matter to your brand.
CSP’s Top 202 details the largest chains in the convenience-store industry and the biggest M&A stories of the past year. Welcome to a deep dive into the c-store landscape.
Category sales performance in Beverages, Candy, General Merchandise, Packaged Food/Foodservice and Snacks.
The industry’s largest distributors by sales volume
Corporate retail news affecting the convenience-store industry
The latest information on products and trends in the convenience-store and foodservice industries.
Peek inside new convenience stores to uncover the best in retail store design across North America.