TELITA SNYCKERS: With the ban lifted, what’s next for dirty tobacco?
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It’s taken 141 days, but from tomorrow, the tobacco ban will finally be lifted. Unfortunately, it may well be too little, too late. The fact is, illicit cigarettes are likely to dominate the local landscape in the foreseeable future.
What does the lifting of the ban mean for the balance of power in the industry? Who stands to win, and who stands to lose?
Clawing back market share: Playing dirty or crafting new alliances?
The market has seen some radical changes: British American Tobacco (BAT) used to dominate the local market by some margin, estimates suggests it now controls as little as 9% of the market.
While BAT will undoubtedly be able to claw back some of the loss, it has most likely permanently ceded some of its smokers to companies like Gold Leaf Tobacco, Carnilinx, Best Tobacco, and Amalgamated Tobacco.
This is worrisome. Even before the lockdown, when BAT’s market share was under far less pressure than it is today, it was clearly not averse to playing dirty to get rid of the competition.
We will most likely see an increase in both allegations and enforcement activity against the smaller players (much of it probably well deserved) as BAT exerts its influence over our law enforcement agencies.
With the Tobacco Institute of Southern Africa (TISA) having shut down at the end of 2019, BAT lost its main ally and mouthpiece. But in that vacuum, Fita — the organisation representing the smaller, independent tobacco firms like Carnilinx — has assumed greater public prominence.
So it perhaps wouldn’t be surprising if BAT made overtures to craft some kind of alliance with Fita, in an effort to create a more unified front for the tobacco industry in its engagements with government.
New kids on the block: loose tobacco and vaping
In recent weeks, we’ve seen an increase in alternatives to cigarettes. In particular, we’ve seen a surge in the roll-your-own (RYO) market, with vendors cryptically selling “kriekgif” (cricket poison) or “molgif” (mole poison) online, delivered by courier.
Indications are that many smokers have migrated to RYO, finding it both convenient during the lockdown, but also far cheaper than buying ready-made cigarettes.
This trend poses a significant challenge from an enforcement perspective: regulating the supply chain of cigarettes is relatively straight forward. But regulating and tracking loose tobacco? That’s a far more difficult task.
While we saw lots of enforcement action against small-scale ...
What does the lifting of the ban mean for the balance of power in the industry? Who stands to win, and who stands to lose?
Clawing back market share: Playing dirty or crafting new alliances?
The market has seen some radical changes: British American Tobacco (BAT) used to dominate the local market by some margin, estimates suggests it now controls as little as 9% of the market.
While BAT will undoubtedly be able to claw back some of the loss, it has most likely permanently ceded some of its smokers to companies like Gold Leaf Tobacco, Carnilinx, Best Tobacco, and Amalgamated Tobacco.
This is worrisome. Even before the lockdown, when BAT’s market share was under far less pressure than it is today, it was clearly not averse to playing dirty to get rid of the competition.
We will most likely see an increase in both allegations and enforcement activity against the smaller players (much of it probably well deserved) as BAT exerts its influence over our law enforcement agencies.
With the Tobacco Institute of Southern Africa (TISA) having shut down at the end of 2019, BAT lost its main ally and mouthpiece. But in that vacuum, Fita — the organisation representing the smaller, independent tobacco firms like Carnilinx — has assumed greater public prominence.
So it perhaps wouldn’t be surprising if BAT made overtures to craft some kind of alliance with Fita, in an effort to create a more unified front for the tobacco industry in its engagements with government.
New kids on the block: loose tobacco and vaping
In recent weeks, we’ve seen an increase in alternatives to cigarettes. In particular, we’ve seen a surge in the roll-your-own (RYO) market, with vendors cryptically selling “kriekgif” (cricket poison) or “molgif” (mole poison) online, delivered by courier.
Indications are that many smokers have migrated to RYO, finding it both convenient during the lockdown, but also far cheaper than buying ready-made cigarettes.
This trend poses a significant challenge from an enforcement perspective: regulating the supply chain of cigarettes is relatively straight forward. But regulating and tracking loose tobacco? That’s a far more difficult task.
While we saw lots of enforcement action against small-scale ...
