Thou shalt sell tobacco. That seems to be the motto of Albert Heijn. Albert Heijn entrepreneurs are obliged to sell cigarettes; smoking products are, say two franchisers, in the basic range. The Albert Heijn head office does not want to confirm this when asked. “We never make any statements about the content of agreements with entrepreneurs, that is something between us and the entrepreneurs.”
Competitor Jumbo is more candid: “Tobacco is part of the Jumbo range in all stores.” Do Jumbo entrepreneurs have the right to refuse the sale of tobacco? Spokesperson Jumbo: “As usual, we do not make any statements about agreements with our entrepreneurs.” The cigarette is also part of the formula at Plus, although the entrepreneurs are not obliged to do so, according to the Plus spokesperson. At Coop (tobacco is also included in the range), an entrepreneur who is interested in it can ‘enter into a conversation’. Smoking products are not included in the ‘basic package’ at the Spar.
Mandatory or not, conversations with experts and dozens of supermarket entrepreneurs show that the smoking customer is very welcome: he generates turnover, not only from the tobacco, but also makes other purchases. The forthcoming ban on sales is therefore keeping supermarket franchises busy (of the total of 6,400 supermarkets in the Netherlands, 4,600 are owned by entrepreneurs), albeit in different ways. Some of them (at least six) have already started their own tobacco shop, such as Dennis Lankreijer.
The Albert Heijn van Lankreijer is located in Loosdrecht on the Oud-Loosdrechtsedijk, in the middle between two busy lakes. Recently, a billboard with the Tabac & Gifts logo has been installed on the street next to his supermarket. Lankreijer opened this so-called convenience store where you can buy magazines, postcards and cigarettes in December 2021.
He is already preparing for the ban on tobacco sales by supermarkets, which will come into effect from 2024. He fears that his smoking customers — his tobacco turnover is at least 11 percent and in the summer even more — would otherwise move to a shopping center nearby, where there is already a supermarket with a tobacco shop around the corner. “If people can no longer buy cigarettes in the store, they will drive.”
‘I am the mayor’
There are also entrepreneurs who are considering setting up a tobacco point of sale, such as Henk Hoeve. He can turn his gift shop next to his supermarket into a convenience store “if necessary” because he fears for the survival of his supermarket.
Hoeve runs a Dagwinkel in Gasselternijveen, Drenthe, a supermarket chain mainly found in small municipalities. Henk Hoeve’s supermarket has a tobacco turnover of more than 20 percent. He fears that the only shopping center in his village in Drenthe will go under if a tobacco ban is imposed. “The baker, the butcher, my gift shop and liquor store. They all disappear.”
If his smoking customers no longer visit his supermarket, he suspects, they will no longer visit the other shops around it. This makes the villages unlivable, according to Hoeve. “I also want a smoke-free society,” he says. “But no shopless rural areas.”
However, most franchisers, according to the tour, are less pessimistic, even in villages or shopping centers without nearby convenience stores. You have to adjust your business operations when circumstances change, they are told. They are making plans to make up for their lost sales with a different assortment. For example with sandwiches, fresh meals or with the catering at the local care home.
Ralf Tijms from de Spar in Ursem in North Holland is not at all afraid that his smoking customer will go to a competitor. Tijms knows what is going on in the village and knows almost all of his customers by name. “The village understands the importance of my shop,” he explains. “I’m actually the mayor here.”
Despite this, alarmist voices about the threat of massive bankruptcies predominate in the official report on the economic impact of the forthcoming tobacco ban on supermarkets. In December last year, research bureau SEO Economic Research, commissioned by then State Secretary Paul Blokhuis (Public Health, Welfare and Sport, ChristenUnie), calculated the impact on entrepreneurs if tobacco disappears from supermarket shelves. Of the 4,600 supermarket entrepreneurs in the Netherlands, five hundred may go bankrupt, SEO thinks.
The lobby of the Professional Center
How does SEO get this number? That turns out to be a different story. When the SEO study starts, there is a problem: the head offices of the supermarket chains do not want to participate – except for Albert Heijn, who cancels at the last minute, recalls lead researcher Lucy Kok.
And then called the Vakcentrum, ‘the independent advocate and proven partner of independent retailers in food, non-food, fast-moving consumer goods and franchisees’, of which more than a thousand supermarket entrepreneurs are members. The Vakcentrum presents itself as a discussion partner and saves SEO a lot of work by introducing twelve supermarket entrepreneurs to the researchers. Now the researchers don’t have to scour supermarkets themselves. But, as Kok acknowledges: “That was not a random sample.”
Most franchisers tell the researchers that they fear that their smoking customers will turn to supermarkets where they can find a tobacconist within 200 meters. “We have heard the argument and it seemed plausible to us,” says Kok.
After a check in the scarce literature on this theme, the researchers continue their calculations. This set the tone: the SEO calculates that of the supermarket entrepreneurs without a tobacconist 200 meters away, eight hundred can generate enough turnover to open their own tobacco and convenience store and possibly five hundred will go under.
The findings of the SEO receive a lot of attention. “Hundreds of small supermarkets collapse due to tobacco ban”, headlines AD† Even State Secretary Blokhuis is not immune to the falling sympathetic neighborhood supermarket. In a letter to the House of Representatives, Blokhuis writes that bankrupt neighborhood supermarkets “in small centers” can be bad for the quality of life and should therefore receive “the necessary attention”.
Email Bombing
Earlier, the Vakcentrum found little response to its objections to the sales ban. But now that SEO research is getting so much attention, it’s picking up. In March 2022, it calls on its members to send e-mails to members of parliament. In this call, in the hands of The Investigative Desk, the Vakcentrum advises its members ‘to make a similar sound and not to contradict each other’.
The supermarkets are asked to first show understanding for the measure, and then emphasize that it is “unsubstantiated” that supermarkets should stop selling tobacco, “especially because the research carried out on behalf of VWS shows that the impact is enormous. is”. The supers can also describe which amenities will go down; “think of ATMs, postal points and other services”.
There is urgency. “Do it now.” An important parliamentary debate is in the pipeline, the debate on lifestyle prevention on 24 March.
Just before the debate on the House of Representatives, the mailboxes of the prevention spokespersons are filled with dramatic testimonials from supermarket entrepreneurs from all over the country. MPs react with surprise. Mirjam Bikker of the ChristenUnie: “It is terrible that these things have to consist of tobacco; to be honest, I was shocked.”
Caroline van der Plas of the BBB makes a case for the supermarkets in small villages: “Implementing this ban may mean that the quality of life and social bonding in hundreds of villages and neighborhoods will deteriorate further.” She calls for the ban to be lifted in its entirety.
State Secretary Maarten van Ooijen (ChristenUnie), Blokhuis’ successor, does not want to get rid of the total ban in supermarkets. But, like his predecessor, Van Ooijen promises during the debate that he will look ‘very carefully’ at the consequences of the tobacco sales ban for the small supermarkets and the effects on quality of life.
The experts speaking to The Investigative Desk question the SEO findings. Retail expert and economist Joeri van Rens says that supermarkets will collapse. “Especially shops in smaller villages and centers with a high tobacco share. But it certainly won’t be five hundred.” He calls the estimated number of bankruptcies a ‘flat sum, calculated for the situation in which entrepreneurs ‘do nothing’. But who is going to shrug and wait for it to go bankrupt?” Van Rens knows that most entrepreneurs are already trying to make up for the lost turnover with a different range, such as the aforementioned sandwiches.
Earned a lot of money
He also thinks the estimated number of supermarkets (800) that will open a tobacconist’s shop is too high. He thinks there will be a few dozen. “The picture is that a lot of money is made in the tobacco industry,” he explains. “That’s right, but mainly by the suppliers and producers and not by the stores; the average gross profit on a pack of cigarettes is around 8 percent.”
And there are more factors. For example, suitable retail space must be available near a supermarket. Last but not least: the cabinet has not yet decided when convenience stores may sell tobacco (in future only through tobacconists). Van Rens: “That creates uncertainty among entrepreneurs.”
Peter ter Hark, real estate lecturer at Fontys University of Applied Sciences and an expert in the field of supermarket real estate from the Retail Prospect consultancy, doubts the reasoning that the smoking customer will soon ignore the neighborhood supermarket. Ter Hark calls the substantiation “extremely thin”: “The only evidence is an American drugstore formula that would have lost sales when it stopped selling tobacco. You cannot draw firm conclusions from that for the supermarket sector in the Netherlands.” Furthermore, Ter Hark sees little substantiation for the argument that a point of sale must be located within 200 metres. “When I advise supermarkets on the purchase of real estate, I use a radius of about 500 meters.” In conclusion, Ter Hark thinks “that the effects will really not be that bad, except for incidental cases”.
The bottom line is that the Vakcentrum whipped up the figures by selecting and supplying the interlocutors (the supermarkets). Those were supermarkets that came with their 200-meter fear. The SEO failed to comment on this and started to calculate with that reasoning and arrived at the high figures.
When asked to SEO’s lead researcher Lucy Kok what she would have done differently looking back, she says: “We would have made explicit that the estimate of the 500 supermarkets that might go bankrupt was a maximum estimate. In addition, we would have substantiated the assumptions in more detail and possibly interviewed more supermarkets.” Although she doubts whether this would have provided more insight into the number of supermarkets that would start a tobacco store, because most did not know that yet.
And then there is the Lidl supermarket, which removed the cigarettes from the shelves of its branches as of October 2021. “Customers are usually very positive about this,” says Quirine de Weerd, Lidl spokesperson. “We are doing this for future generations and no one is against that. We haven’t noticed,” she concludes, “that customers are staying away.”
A version of this article also appeared in the newspaper of 15 June 2022