Tobacco display ban to hit VIC retailers with $182 million bill

Peak retail industry body the Australian Retailers Association (ARA) said Victorian retail outlets - including supermarkets and convenience stores - will need to make costly adjustments to their store configuration and to their operating procedures in order to comply with a proposed retail display ban on cigarette packets.

ARA Executive Director Russell Zimmerman said the proposed retail display ban on tobacco products will burden Victoria’s small retailers with a $182 million   total economic cost in the first year.

“The total bill would be shared across 5,000 convenience stores and 1,000 grocery stores in Victoria that would each be liable for up to $10,000 to meet their obligations under the planned tobacco display laws.

“In an indicative regulatory cost analysis by Deloitte, it was also found that a Victorian retail display ban would result in recurring costs of $116 million. This translates into the average ‘mum and dad’ convenience store having to bear ongoing costs of up to $17,560 per year, due to deterioration in customer transaction and service times.

“Under the proposed regulations, store owners can be fined or banned from selling tobacco products if cigarette packets are within the view of customers, which will result in a complete refit of current displays, as well as ongoing training, customer service and restocking issues.

“This is potentially a massive financial burden for small retailers to carry when we consider there is no international evidence that restricting the display of cigarettes actually reduces the uptake of smoking. In fact, New Zealand has dismissed similar regulations based on the huge expense and lack of supporting evidence.

“While retailers fully appreciate the health dangers associated with smoking, the financial impact of these regulations is not a public health issue. The ARA’s concern is about an increased cost to retailers when they can least afford it.

“To ease the burden and cut costs for small retailers the Brumby Government must reconsider and make amendments to the proposed tobacco display regulations allowing retailers to: display price tickets or labels, use price notices at more than one point of sale and use product catalogues,” Zimmerman said.  

For over 105 years, the Australian Retailers Association (ARA) has been the peak industry body in Australia’s $292 billion retail sector which employs over 1.5 million people. As an incorporated employer body under the Workplace Relations Act and with a range of member services including business consulting, policy development, advocacy and education, the ARA promotes and protects over 5000 independent and national retailers throughout Australia. Visit www.retail.org.au or call 1300 368 041.

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