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Aftermath of change in tax structure-Cigarette Market in Cambodia: Ken Research

Posted on 08 February 2017 by KenResearch Food and Beverage ,

Ken research announced recent publication on, "Cigarettes in Cambodia 2016". The report gives a detailed understanding of consumption to align your sales and marketing efforts with the latest trends in the market. Identify the areas of growth and opportunities, which will aid effective marketing planning. The differing growth rates in regional product sales drive fundamental shifts in the market. This report provides detailed, authoritative data on this changes-prime intelligence for marketers. Understand the market dynamics and essential data to benchmark your position and to identify where to compete in the future. Cigarettes in Cambodia 2016 are an analytical report provides extensive and highly detailed current and future market trends in the Cambodian market. The report offers Market size and structure of the overall and per capita consumption based upon a unique combination of industry research, fieldwork, market sizing analysis, and our in-house expertise.

Cambodia's return to democracy in 1993, while bringing about conditions that should in theory benefit a market such as cigarettes, was also accompanied by rising non-duty paid sales. This resulted in duty paid volumes dropping to around six billion pieces in 2006, although some improvement to 7.5 billion pieces was recorded by 2014. Per capita consumption rates have fallen as the country's population has expanded and stood at 485 pieces in 2015, 24.9% lower than in 1990. Cambodia has a rapidly growing population of 15.5 million people in 2014.

Only just over half of cigarettes smoked are filtered, their share up only slightly on 1990. Virginia blends are the most popular. With per capita incomes rising, demand for mid-priced brands is growing. However, it is high priced brands that are seeing the strongest growth, their share rising to 6% of volumes in 2007 compared with only 2% in 2004. Until the mid-2000's Cambodia had a relatively relaxed approach towards the regulation of the tobacco market. This changed in November 2005, when the country's government ratified the WHO's Framework Convention on Tobacco Control. Moves following the ratification of the FCTC include the launch of graphic on-pack warnings in July 2010. 

America, Vietnam, Malaysia, Indonesia, Switzerland, Thailand, and China are just a few of the sources of imported cigarettes in Cambodia. Cigarette promoters will have to stop work when a tobacco advertisement ban takes effect in late August, a health official said yesterday. A February sub-decree, which also bans advertising tobacco in the media and on billboards, states that the “promotion of tobacco products to customers by agents of tobacco companies shall be prohibited.” Yel, Daravuth, tobacco-free initiative project managed at the World Health Organization, said this clause meant that cigarette promoters would have to seek alternate jobs.

Within almost six months of a sub-decree going into effect requiring graphic warnings on all cigarette packages, Health Minister Mam Bunheng issued a second warning this month to tobacco companies not complying with the regulations, threatening to take legal action. The January 16 warning follows a first notice issued in early October prompted by companies’ low compliance with the sub-decree, which went into effect in July. Under the rules, graphic photos must cover 50 percent of cigarette packets, and a written message in Khmer must cover another 5 percent. Those found violating the rules are subject to fines of about $1,000 for tobacco companies, $500 for distributors and wholesalers, and $2.50 for retailers. The ministry will take legal action soon for companies that don’t obey the law and sub-decree,” Bunheng said in the warning. “The ministry . . . will not issue a third warning.” Ung Phyrun, secretary of state at the Ministry of Health, said the ministry will only warn companies twice before punishing them. “This is the principle to make everyone obey the law, to make the companies aware of this,” he said. Phyrun would not directly address why companies are still non-compliant. “We will talk to all the [tobacco] companies that are doing [business] in Cambodia,” he said.

Cigarette companies are spending millions of dollars in advertising and promotional campaigns in Cambodia. Yet the market is small - five to seven billion sticks sold per year - and annual growth, at roughly three percent, is not spectacular. According to studies by, 70 percent of all males smoke, while cultural taboos suggest that the cigarette industry will not be able to make inroads among females: only one female in ten smokes, and nearly all of them are above 40 years old. Instead, companies are spending millions building brand loyalty in a country where consumers seem to switch brands on a whim. This means targeting the 18 to 35-year-old smoker and depending on the aspiring middle class to move from their medium-priced cigarettes to higher-priced brands.

For more coverage click on the link below:

https://www.kenresearch.com/food-beverage-and-tobacco/tobacco-products/cigarettes-cambodia-2016/79693-11.html 

Related links:

Smokeless Tobacco in France, 2017

 Smokeless Tobacco in Finland, 2017 

Contact: 
Ken Research
Ankur Gupta, Head Marketing & Communications
query@kenresearch.com

+91-124-4230204
www.kenresearch.com

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Trending Cigarette Market demand, Singapore: Ken Research

Posted on 07 February 2017 by KenResearch Food and Beverage ,

Ken Research announced recent publication on, "Cigarettes in Singapore, 2017". Report gives a detailed understanding of consumption to align your sales and marketing efforts with the latest trends in the market. Identify the areas of growth and opportunities, which will aid effective marketing planning. The differing growth rates in regional product sales drive fundamental shifts in the market. This report provides detailed, authoritative data on this changes-prime intelligence for marketers. It can be used to understand the market dynamics and essential data to benchmark client position and to identify where to compete in the future with this report.

Singapore is important as a major distribution centre for the Asia-Pacific region, but its relatively small population, currently around 5.7 million, means it has only a small domestic cigarette market. Annual per capita consumption levels are relatively low in regional terms, averaging 514 pieces in 2014. However, the effects of the economic difficulties, increased taxes, high non-duty paid sales, competition from RYO cigarettes, and a tightening of restrictions on tobacco consumption have depressed demand for manufactured cigarettes. The local market is dominated by filter cigarettes, which account for virtually 100% of sales or 2.87 billion pieces in 2014. Most of the industrial activity in the Singapore cigarette market is centered on the import and re-export of cigarettes. The market has been almost entirely contested between three companies: Philip Morris Singapore (PMI), British American Tobacco Singapore (BAT) and Japan Tobacco International (JTI). The most significant development of recent years has been the emergence of the low priced sector. Cigarettes in Singapore 2017 are an analytical report provides extensive and highly detailed current and future market trends in the Uruguay market. The report offers Market size and structure of the overall and per capita consumption based upon a unique combination of industry research, fieldwork, market sizing analysis, and our in-house expertise.

From Aug 1, 2017, retailers of tobacco products will not be allowed to display them in their shops, the Ministry of Health (MOH) announced on Wednesday. The ministry said it would move to ban stores from displaying such products after amendments to the Tobacco (Control of Advertisements and Sale) Act are tabled in Parliament. Retailers may choose to use existing storage units, modify them or install new storage units that are permanent, self-closing and opaque. Retailers could choose to use vertical blinds, or even a curtain, among others. They are to comply with the new requirements, whereby tobacco products need to be out of sight from the public at all times. Exceptions will be made in the process of restocking the display unit or during a sales transaction, unless the staff carrying out these actions stops to do something else.

MOH is prepared to allow a text-only price list in a standard format, to facilitate transactions and ensure a level playing field while preventing misuse as a form of advertisement. It added that it will allow storage units to be in the same colour as the decor or interior walls of the outlet, as long as the colour does not draw specific attention to storage units.  A brochure, published by the Health Promotion Board in the four national languages, will be distributed to retailers in the coming months, detailing the dos and don'ts of storing and selling tobacco products. Authorities will work with retailers to help them comply with the new legal guidelines. Even if the new legalisation has been implemented it is only to protect non-smokers - particularly the young - from the promotional effect of point-of-sale displays and to create a better environment for smokers who are trying to quit.

BANNING POINT-OF-SALE DISPLAYS OVERSEAS HAS BEEN SUCCESSFUL: MOH pointed to research that showed that banning point-of-sale tobacco displays overseas has positive effects. Daily smoking rates in Iceland decreased from 28.1 per cent in 1996 to 19.3 per cent in 2006 after a point-of-sale display ban on tobacco products was introduced in 2001.

RETAILERS QUESTION EFFECTIVENESS OF MOVE: Retailers Channel News Asia claimed to say the ban would not have too great an impact on business, but they questioned its effectiveness in getting people to quit. Some customers will still insist on buying cigarettes. Even if they are hidden, they will ask us (for them). MOH said it would continue to work with retailers to fine-tune the specific details of the measures. General tobacco retailers will be required to use plain, undecorated storage devices to keep tobacco products within their premises out of the direct line of sight of the public and potential customers.

The amended Act extends existing restrictions on e-cigarettes to include newer varieties, which do not necessarily bear a physical resemblance to cigarettes or other tobacco products. The component parts of such products will also be banned to prevent retailers from importing them and reassembling them locally for sale. Existing prohibitions on advertisements for tobacco products will also be extended to cover advertising for e-cigarettes and similar products. The ban on advertising for tobacco products, e-cigarettes and similar products will also be extended to advertisements published electronically. Advertisements and sales promotions originating from Singapore, whether targeting local or foreign audiences, and advertisements from outside Singapore, which can be accessed by people in Singapore, will now be banned. Customer loyalty programmes and promotional schemes involving tobacco products are also not allowed. A ban on emerging tobacco products first imposed in June last year will now be extended to include the likes of nasal snuff, oral snuff and gutkha. From Monday, the grace period for importers and retailers on the ban on shisha - first imposed in November 2014 - comes to an end.

Existing licensed tobacco importers and retailers who import or sell shisha will be prohibited from importing, wholesaling or retailing the product. Any person who contravenes either the ban on emerging tobacco products or the ban on shisha can be fined up to $10,000, imprisoned up to six months, or both. In the case of a second or subsequent conviction, they could face a fine of up to $20,000, imprisonment of up to 12 months, or both.

 

For more coverage click on the link below:

https://www.kenresearch.com/food-beverage-and-tobacco/tobacco-products/cigarettes-singapore-2017/79695-11.html

 

Related links:

Smokeless Tobacco in France, 2017

Smokeless Tobacco in Denmark, 2017

Contact: 
Ken Research
Ankur Gupta, Head Marketing & Communications
query@kenresearch.com

+91-124-4230204
www.kenresearch.com

...

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Economic Condition Leading to Fall in Domestic Demand for Cigarettes in Belarus: Ken Research

Posted on 19 January 2017 by KenResearch Food and Beverage ,

Ken research announced its recent distribution on, "Cigarettes in Belarus, 2016 ". Report provides extensive and highly detailed current and future market trends in the Belarus market. The report offers Market size and structure of the overall and per capita consumption based upon a unique combination of industry research, fieldwork, market sizing analysis, and our in-house expertise. To get a detailed understanding of consumption and to align your sales and marketing efforts with the latest trends in the market, you may undoubtedly refer to this far-fetched market outreach analysis. It closely identifies the areas of growth and opportunities, which will aid effective marketing planning. The differing growth rates in regional product sales drive fundamental shifts in the market. This report provides detailed, authoritative data on changes and hence, acts as prime intelligence for marketers. It highlights the market dynamics and essential data to benchmark your position and to identify where to compete in the future.

Belarus has a state controlled economy where incompetent, government-run businesses from the Soviet era dominate markets and the state spends billions every year on handouts, tariffs and subsidies. Belarus, like many other of the former Soviet Republics, suffered badly during the early 1990s after the break-up of the Soviet Union and the resultant economic turbulence. Belarus’ economy suffered a broad-based decline in the third quarter of 2016, with a dip in GDP this fiscal year, with private consumption, investment and government spending all falling compared to the same period last year. The country was negatively impacted by the continuing recession in Russia, its largest trading partner, as well as by weak domestic bank balance sheets, which impeded private lending. The energy dispute with Russia is another persistent cloud on the horizon, which is causing geopolitical uncertainty and could increase the cost of Belarus’ energy imports. However, some green shoots of recovery are visible in industry, with industrial production growing at the fastest pace in two years in November. Belarus’ economic advancement depends in large part on the implementation of the government’s 2016-2020 action plans, which aims to break up monopolies, improve governance and prepare the country for accession to the World Trade Organization.

In 2015 retail volume sales of cigarettes in Belarus saw an increase, whilst in 2014 sales declined. This was because the excise on cigarettes in 2015, and as a consequence their unit prices, grew more slowly than the Belarusian rubel devalued. This led to an increase in the retail price disparity for cigarettes between Belarus and nearby European countries (such as Lithuania, Latvia and Poland). This disparity remained the main reason for so-called “people’s exports” – cigarettes which are sold in Belarus and taken out of the country to nearby European countries by private travellers. Because the prices of cigarettes in Belarus are lower than in these EU countries, Belarus remained a conduit for cigarette smuggling to neighbouring EU countries. The Belarussian Cigarette market is heavily regulated by the government, with production quotas, restrictions on imports, and retail price control shaping the market. President Lukashenko is set to continue this regulation, with a view to increase tax receipts from the industry. The government aims to do this through strengthen local production, through a crackdown on counterfeit products. Despite this, sales are set to fall by 35.5% by 2025. Let us cross examine these in details:

Increase in Excise duty and Disposable income

In the framework of harmonization of excise policy within the EEA from 1st January 2013, Belarus increased excise taxes on tobacco and alcohol. As a natural result, the sales of alcohol and tobacco products decreased. Belarusian manufacturers of these products, given the reduced domestic market opportunities are forced to look for export options to maintain their production volumes. Excise taxes on tobacco products from 1 January 2013 increased by 1.5-3.5 times. In Q3 and Q4 further were envisaged. Belarusian government introduced these measures to meet its commitments within the EurAsEC Anti-Crisis Fund and to harmonize the excise policy within the CES. It is planned to continue gradual increases of excise duties on tobacco to level with Russia. Resultantly, the prices on tobacco and its products have increased radically.

Ban on open retail advertisement of Cigarettes

From 1 July 2015, the open display of tobacco products was not allowed in retail outlets. Information on the various brands available in retail can only be in the form of a list of tobacco products, indicating their names and prices. This list should be drawn up in accordance with the approved model. The storage of tobacco products in retail outlets should be in enclosed cabinets. Also from 1 July 2015, the term “electronic cigarette” was banned in retail. Such products continued to be sold, but under different names, for example “vapour device” or “steam generator”. In addition, The Customs Union has decided not to import snuff from 2016. After the sale of the existing stock, sales of snuff will cease in Belarus.

Increase in domestic supply of cigarettes with changing patterns, split in price Band

In 2015 the share of domestically produced cigarettes continued to increase, leading to declining imports. The share of imports within total volume sales fell in 2015. In 2015 the share of purely domestic brands also increased, at the expense of the share of international brands (both imported and produced locally). 2015 also saw changes in the spilt of cigarettes by price, with the increasing share of the economy segment and the declining share of the premium segment. All these changes, which can be classed as de-premiumisation, were caused by the worsening economic conditions in Belarus in 2015, with decreasing consumer purchasing power and the growing trend for economical consumption.

Shift of consumers to modern Outlets

The development and increasing popularity of modern retail formats such as supermarkets, hypermarkets, discounters, convenience stores and forecourt retailers continues in Belarus. The share of modern retail formats within total sales of tobacco products keeps increasing. This is because modern retail outlets offer more advantages for consumers, such as convenient locations, free parking and a wider product assortment.

For more coverage click on the link below:

https://www.kenresearch.com/food-beverage-and-tobacco/tobacco-products/cigarettes-belarus-2016/73683-11.html

 

Contact: 
Ken Research

Ankur Gupta, Head Marketing & Communications

query@kenresearch.com

+91-124-4230204
www.kenresearch.com

...

Read more…