Fewer shop closures than expected after tobacco sales ban in Dutch supermarkets
More than a year after the ban on tobacco sales in supermarkets, the impact on small local stores appears less severe than anticipated, NOS reports. The tobacco sales ban, introduced over a year ago, sparked concern over the survival of supermarkets in smaller towns, where tobacco products made up a significant share of revenue.
Market researcher Locatus reported to NOS that since early last year, 27 supermarkets have closed in villages with fewer than 5,000 residents, where only one supermarket served the community. These locations included a total of 542 such small supermarkets.
Laurens Sloot, a supermarket expert, responded to the data: “That’s better than I expected. The business model of small supermarkets was already under pressure before the tobacco ban. They often have less than 1 percent profit margin on their annual turnover.”
Sloot explained the financial hit to NOS: “Small supermarkets lost roughly 10 to 15 percent of their turnover after tobacco was removed. Larger supermarkets lost only a few percent.” He added that smokers now have less reason to visit local stores. “If they have to drive to the nearby city for a tobacco shop, they might as well do all their shopping there.”
Peter ter Hark, another supermarket analyst at Retail Prospect, told NOS that tobacco restrictions add to existing problems: “The ban is an extra blow. On top of that, they face rising personnel costs, automation expenses, and shrinking profit margins.”
The closure of small supermarkets has been ongoing for years and is expected to continue. “It’s a hard trend to reverse,” Ter Hark told NOS. Sloot compared it to the rise of online retail: “Bart Smit, a toy store chain, didn’t collapse immediately either. A recent industry study predicts about 15 percent of supermarkets will close within the next decade, mostly small local stores.” That would mean approximately 700 closures.
In response, some supermarket owners are innovating. In the Frisian village of Wijnjewoude, local supermarket operators John van der Veen and Heidie Talsma adapted quickly after losing about 14 percent of their sales due to the tobacco ban.
Van der Veen said, “That was tough. We really worried about it. How do you solve that?” He described their solutions: “We started selling meat from a butcher in a nearby village. We used to sell 500 euros worth of manufacturer-packaged meat; now we sell 2,500 euros of butcher meat with a good margin, along with fresh meals. We also expanded our bread selection and sell more baked goods from a real baker. That’s going very well.”
They also recently introduced protein products, “which are very popular with young people.”
Talsma explained their approach to personnel costs: “I am arranging for some employees with disabilities to work here under supervision. They receive government benefits, so we save thousands on wages. It makes us a social hub in Wijnjewoude. That’s great.”
Van der Veen emphasized the need for creativity: “Entrepreneurs have to be creative. Every new situation demands a reaction. So do it.”
