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ING says supermarket revenue will drop sharply due to ban on tobacco sales
Supermarkets will lose over 1.5 billion euros in earnings due to the ban on selling tobacco that comes into effect on July 1, according to ING. Researchers at the bank claim that 35 percent of tobacco sales will shift to tobacconists and smaller convenience stores.
Filling stations and shops just over the border abroad are also set to benefit from the Dutch supermarket tobacco ban.
ING said that the revenue for supermarkets will wind up falling for the first time in 20 years. Tobacco accounts for around seven percent of a supermarket's revenue. That represents roughly 3.2 billion euros in total annually.
"The revenue drop will be more visible during the second half of 2024," said ING economist Thijs Geijer. Most supermarkets, except for Lidl and most Albert Heijn shops, will continue selling tobacco for the first six months of the year.
"Because it is introduced on July 1, the ban will continue to reduce the turnover growth for supermarkets in 2025 significantly," Geijer predicted.
When excluding tobacco sales, the sales in supermarkets are on the rise, according to ING. The prices on the shelves appear to be headed for another one percent increase, after a sharp rise in prices during previous years.
Reporting by ANP