The e-cigarette pilot has become a hot spot in the vaping industry recently, among which Xiamen and Huizhou have already been identified as pilot cities.
The new force of atomization has obtained some information from some retailers participating in the China Tobacco electronic cigarette pilot in Xiamen, and especially shared it with you. During the period, retailers emphasized a core point, boasting that the China Tobacco Regulatory Bureau is very “nice”, and industry people should be optimistic and stick to it.
1More than 80% of e-cigarette stores in Xiamen participated, and specialty stores became the main force of the pilot!
What are the “landing details” of the Xiamen electronic cigarette pilot? What are the requirements?
According to the news, starting from March 25, Xiamen Tobacco Bureau has already signed a pilot agreement with a store, and the official pilot time will start in April.
The proportion of stores participating in the pilot is very high, with more than 80% of Xiamen e-cigarette stores participating in the pilot. However, it should be noted that the pilot program was conducted by applying to the Tobacco Bureau a few years ago for those retail stores, which basically represent the retail stores that did not apply for the previous year, and the possibility of “regularization” in the future is very small. I haven’t heard the saying that the Huizhou store is 5 to 1, and almost all stores in Xiamen can get the pilot; nor has it said that a store has a pilot, and the surrounding stores cannot.
It is also recommended to actively participate in the China Tobacco pilot. Some officials in Xiamen said that the stores that can become the pilot may get the retail license first, but there are also sayings that they may not be able to get it. It means that if China Tobacco contacts the pilot, it must go, and it is even more necessary to take the initiative to contact to become the pilot. However, it is also mentioned here that the pilot in Xiamen this time is mainly for the pilot store, and the authorized store does not have this statement. Here is a signal that the specialty store may have a great chance to easily turn into a collection store.
The retailer said that he has 5-6 stores, and signing an agreement means that he can pilot it. At present, Xiamen can only purchase three brands of RELX, grapefruit and Ono (some new brands may be added in April). And you can order fruit flavors (even the best-selling flavors), and the pilot is available until June 30, including existing stock items.
However, the retailer emphasized that the Tobacco Board reminded that if there is still stock in May, it is best to sell it in advance.
What I want to say here is that brands that can order may not be able to obtain licenses; brands that have not become pilots may also be able to obtain licenses. China Tobacco will also decide which brands can get the certificate in the near future.
Xiamen limits the order quantity. The retailer said that they wanted to buy 40,000 per store before, but later stipulated that the maximum order quantity was lowered to 20 boxes (limited for each flavor), and the previous order of 100 boxes was unsuccessful. However, in contrast, the Huizhou pilot did not receive a request to limit the order quantity, and ordered according to the specific conditions of the store. The Xiamen retailer also talked about ordering at least 5 boxes of each flavor, but did not say which brand should be chosen.
Xiamen also said that the national-level rules have not yet come out, and many details are still uncertain, but the implementation plan must be determined by the State Tobacco Administration. Local cities will summarize the pilot experience and show it to the State Tobacco Administration, and then formulate policies. The following cities will issue detailed rules. However, the relevant person directly connected with the Tobacco Bureau said that the pilot experience may be extended to the whole country.
2 The pricing power lies with China Tobacco, and middle-aged and elderly users will be the mainstream users of e-cigarettes!
When it comes to pricing and other issues, the answer given by the Xiamen pilot is that more dominance lies with China Tobacco, while China Tobacco depends more on the brand. Based on the fact that e-cigarettes have broken the original pattern of various flavors and reduced the “inductive” demand, the penetration of users in the future will be more of the middle-aged and elderly groups, and it will give priority to serving smokers.
When it comes to pricing, retailers in Xiamen said that the price of buying from China Tobacco is the same as the price of buying from the brand side. For example, if you get a box of 55 yuan from the brand before, it is also 55 yuan a box from China Tobacco. Xiamen also mentioned that roasted seeds and nuts are prohibited, it is not recommended to stock up, and you cannot sell them at a higher price. Electronic cigarettes can only be sold at the retail price.
In terms of ordering methods, Xiamen’s current electronic cigarette pilot is two methods of telephone and online ordering. In the first week, China Tobacco mainly collects ordering requirements, and in the second week, it is carried out by telephone or online ordering. The local also said, what kind of settlement method is better? Is it online payment or cash on delivery (that is, payment by express delivery)? Shopkeepers can choose these ways.
order cycle. It can only be purchased once a week, just like Xiamen cigarettes. Whether there will be a limited amount of purchases in the future is not yet certain. This may mainly depend on the supply of brands. China Tobacco also finds manufacturers to place orders according to the reported demand. However, it is also mentioned that there will be some benefits for some chain multi-store retailers. For example, the local tobacco bureau may find a large-scale retailer with more than 10 stores to negotiate, and will provide other welfare support, but the purchase price of the product will not be reduced.
Regarding the reasonable layout of stores, there are currently no detailed rules, but these stores in schools must be checked. Supermarkets and convenience stores are temporarily unable to sell electronic cigarettes. Temporarily ban cigarette shops from selling electronic cigarettes, the next step is to see the decision of the superior.
How to change the door, there is no clear requirement, the owner can currently display the brand of electronic cigarette he wants to display. It is estimated that in the future, major brands may find retail stores to strive to display their own brands and increase the rate of entry and return of customers. This also shows that in the future, the terminal market will pay more attention to the operation ability of stores, and the stronger the operation ability, the more attention from brand owners will be.
Certification issues. The e-cigarette retail license does not necessarily say that it can be opened in May, nor does it say that the retail license will be processed during the pilot period. As for the measures to get the goods during the period, you can still find an agent to get the goods and open a store before May, but you need to get a license to sell them after May, and you can only get the goods from China Tobacco.
In terms of after-sales, it is divided into after-sales of pods and after-sales of cigarette rods. I have communicated with people from China Tobacco that there will be after-sales, such as replacement, probably the brand will send it to China Tobacco, and then China Tobacco will send it to the store.
Speaking of whether there are store subsidies? Xiamen said that it is very unlikely that various brands will do subsidies and activities in the future. After all, they do not have as much flexibility as before when they directly face the China Tobacco Bureau.
Here, a retailer participating in the pilot project in Xiamen said that after spending a few days together, the people from China Tobacco are very friendly, and they should not be too pessimistic, but should be optimistic. He also specially mentioned the feeling of this pilot. I feel that China Tobacco is not as thin as it is, and you only need to order from China Tobacco.
And in the future, the industry can sell electronic cigarettes publicly, and electronic cigarettes can be written on the door, which has a legal identity compared to the past.
In the first three months of the New Deal, customers may be lost, but the penetration rate of 3% in China is very low, and there is still a lot of room in the future. For example, Japan has reached 27%. The future trend of e-cigarettes is likely to be dominated by middle-aged and elderly users, and the transformation of middle-aged and old smokers, including the form of products, will change.
From a broad perspective, the choice of Xiamen is based on factors such as the scale of Xiamen’s e-cigarettes and local logistics operations. According to the latest data from Qichacha, there are 10,246 “electronic cigarette” companies in Fujian Province, 1,179 wholesale and retail companies in Xiamen, and 509 retail companies. If it is accurate, there may be more than 200 stores, which belong to China Electronics Co., Ltd. Small and medium-sized cities in Yanmen.
To sum up, the “detailed implementation rules” of Xiamen’s e-cigarette pilot project can already feed back some “substantive” signals. On the one hand, it is not as pessimistic as imagined, but overall it is relatively optimistic; on the other hand, China Tobacco, the regulatory bureau, is crossing the river by feeling the stones, or is very awe of the market, and the original intention is to ensure the smooth operation of this market, which basically means to give E-cigarette practitioners have taken “sedatives” and can embrace the market happily.
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