People Smoking Less. Why Have Tobacco Shops Doubled?

Smoking in the U.S. has been declining for decades, but retailers specializing in tobacco sales (smokeless, cigars, etc.) are not struggling… far from it.  Sales are booming! Between 1998 and 2012, the number of tobacco shops in America has doubled to more than 9,000.

This growth has coincided with increased cigarette taxes and a slew of smoking bans.  So why are tobacconists thriving when the market for their products is theoretically going away?

Interviews with industry experts don’t lead to a single answer. Some say higher prices have created a niche for retailers specializing in discount brands. Others point to the rise in electronic cigarettes (e-cig). There are 3,500 “vape shops” in the U.S.  These new stores may be catering to committed (IE, addicted) smokers who have continued lighting up despite public health efforts.

According to this article, “Many discounters also sell e-cigarettes and other products that convenience stores are unlikely to carry in wide variety. Hookahs—communal water pipes often used to smoke flavored tobacco—are another likely factor in the growth of tobacco stores, says Loope. If you don’t believe him, ask a teenager: Eighteen percent of high school seniors had smoked a hookah in the last 12 months, according to a recent survey published in the journal Pediatrics.”

Read the original article here:
http://www.businessweek.com/articles/2014-09-15/people-are-smoking-less-dot-so-why-have-tobacco-shops-doubled