Greek market registers a further volume decline
Volume sales of tobacco products in Greece continued to decline in 2013. This was partly the result of ever more Greeks quitting smoking, mainly due to the fact that they can no longer afford it, but was also due to rising health awareness and illicit tobacco products rapidly gaining share. In view of tax hikes implemented at the start of 2013, the market’s value sales performance was better than its volume performance as the average unit price of cigarettes increased yet again, along with the price of RYO tobacco, which has been under the spotlight in terms of tobacco tax reform. In this context, whereas at the start of the review period RYO tobacco registered strong growth as it benefited from smokers migrating towards more affordable alternatives, in 2013 it posted a heavy decline in sales.
Illicit trade is thriving
Although illicit trade was most common in cigarettes at the beginning of the review period it is now also becoming a major threat in RYO tobacco, which is increasingly being sold in bulk on the black market. Consecutive price increases have been seen over the past three years, first impacting the price of cigarettes and then RYO tobacco. This had a tremendous impact on tobacco sales, encouraging a good number of smokers to look for tobacco products on the black market, where prices are considerably cheaper. Illicit tobacco products are widely available in outdoor markets and via street vendors, while the internet and ‘personal contacts’ seem to be key when it comes to RYO tobacco.
Supermarkets start to sell tobacco products
Up until 2012, tobacco products were exclusively sold via newsagent-tobacconists/kiosks, convenience stores and forecourt retailers, but with kiosks in particular claiming the lion’s share. In 2013, Carrefour-Marinopoulos obtained a licence to distribute tobacco products, becoming the first supermarket chain in Greece to do so. More grocery chains are set to follow suit in the years to come, hence posing a major threat to newsagent-tobacconists/kiosks, with over 60% of their revenues deriving from tobacco products.
Karelia manages to record an increase in revenue thanks to a focus on exports
Karelia Tobacco was the only tobacco manufacturer to register positive growth in revenues in 2013. This, however, was only partly the outcome of the company’s performance in Greece. Although the company managed to increase its share in most of the categories in which it is present, the company’s performance can be largely attributed to an increase in its export activities. Currently, the bulk of Karelia’s production is exported to foreign markets and the company continues to invest heavily in upgrading its production lines.
Further gloomy prospects for the tobacco market in Greece
Sales are unlikely to show any signs of recovery over the forecast period. Migration to illicit trade is set to rise as such products are becoming increasingly available, regardless of the efforts of the Greek police to tackle the problem. With disposable incomes shrinking, more smokers will be forced to quit smoking altogether or reduce their consumption. Health awareness will also play a role, albeit a minor one. Finally, the Minister of Health announced that from 2014 the smoking ban will be enforced. Although it remains to be seen how successful the government will be in doing this, this is a factor which would further hinder tobacco sales.
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Discover the latest market trends and uncover sources of future market growth for the Tobacco industry in Greece with research from Euromonitor's team of in-country analysts.
Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.
If you're in the Tobacco industry in Greece, our research will save you time and money while empowering you to make informed, profitable decisions.
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The Tobacco in Greece market research report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volumes and values, company and brand market shares
- Five year forecasts of market trends and market growth
- Production, imports by origin, exports by destination
- Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
- What is the market size of Tobacco in Greece?
- What are the major brands in Greece?
- Which sector of the tobacco products market is the largest by value sales in Greece?
- Which sector of the tobacco products market has been growing the fastest, by volume and value, in Greece?
- Which sector is the most heavily taxed in Greece?
- Which companies dominate in the total tobacco market in Greece in terms of market share?
- What is the distribution channel split for the tobacco products market in Greece?
Why buy this report?
- Gain competitive intelligence about market leaders
- Track key industry trends, opportunities and threats
- Inform your marketing, brand, strategy and market development, sales and supply functions
This industry report originates from Passport, our Tobacco market research database.