CVS stops selling cigs... sales of other stuff tumbles

No business EVER does something to be a good example--especially one that is publically traded and owned by shareholders...it's all about profits.They thought that this move would cause many people to move to them on the principle, and banked on more script fills, but someone forgot to really analyze the other negatives that not selling tobacco would have.

That makes no sense. Cvs is a business. Why would they want to shoot themselves in the foot like that?

Not just the cig sales but people that come there for that I'm sure buy other stuff too.

I thought about what a bold move that was when the stores in Nola stopped about a year ago. That's a huge chunk of profit to just axe

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sales of other stuff tumbles

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Probably only cool stuff, cause smokers are cool.

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smoke ban

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Self imposed decisions to not sell tobacco don't mean anywhere close to "ban"... They're making it sound like they're victims.

If CVS wanted to be a good example, they would stop selling booze too. How many deaths can be attributed to alcohol? Goes to show you that most corporations really don't know their customer's wants and needs.

I hope they don't stop their awesome customer reward coupons due to this

Tobacco Ban Clears Out Low-margin, Poorly Selling Cigarettes

Seems like CVS overestimated their ability to make up the profits on other items, but this article from February makes quite a few good points.

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Margins for cigarettes and tobacco average about 15 percent, which puts them into the basket of goods that Costco Wholesale Corp., which specializes in lower-margin items, typically sells, said Jeff Lenard, a spokesman for the National Association of Convenience Stores in Alexandria, Va. That compares to margins of 30 to 50 percent for health and beauty items, which occupy more retail space than tobacco, analysts said.

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While archrival Walgreen Co. and other chains continue to sell tobacco products, drugstores aren't where most smokers buy cigarettes. David Bishop, managing partner at Balvor LLC, a Barrington-based sales and marketing firm, estimates that drugstores account for 5 to 6 percent of all cigarette sales. Compare that to convenience stores, which capture 86 percent of all tobacco sales, according to their trade association.

CVS said in a statement that it has "identified incremental opportunities that are expected to offset the profitability impact," though the company declined to name specific categories.

But cigarettes aren't great money-makers for convenience stores, either. Tobacco products represent the largest in-store sales category for these small shops — 40 percent — but generate 21 percent of a store's gross profit, Mr. Lenard said. Soft drinks, on the other hand, generate nearly 19 percent of a store's profit though the category represents 15 percent of in-store sales.

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CVS has beer but no cigs.
Walgreens has cigs but no beer.

Rite aid for the win!!