Why B&Ms are struggling

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jj1015

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I'm fortunate enough to have two B&Ms in town (Knoxville) that have decent tobacco selections in both bulk and tins. Not great, mind you, but reasonable. Anyway, I like to do most of my shopping online but do drop into each of the stores once a month or so. I buy a tin or two, some cleaners, etc. I like to give them my business and it also lets me buy single tins when I want to sample something they carry. Anyhow, yesterday I went into one of them and was surprised to see some of the new Dunhills. I"ve never been a huge Dunhill fan but have wanted to give the new formulations a whirl, so I asked how much the tins were. $19 apiece (before taxes!!!!) And, on the next shelf, a tin of Long Golden Flake with twice the tobacco for $25! I pointed out that I could get them onine for half the price and the guy working the register (a young guy with little interest in pipes) just shrugged. I then asked how much the Carter Hall was, and each little pouch was $5! I can literally drive a block and get Carter Hall for $3. I ended up buying some Denicool and left.

No wonder B&Ms are struggling if they are marking up products so high! C&D and GL Pease generally go for $15 or so, so I shouldn't have been surprised. I'd really like to patronize them more, but there's no way I'm going to pay twice what I can get stuf online.

Any similar experiences at your B&Ms?
 
B&M's exist on overhead + markup. It's a fixed cost they need to survive. Pay up or shut up is the attitude I've adopted. It is what it is.

Used to have a way great B&M near me. They had a smoking lounge with big screen TV, fine stereo, overstuffed leather furniture, beer and wine, good food, coffee and espresso, a very fine smoke removal system, and let one sample bowls of 'baccy at n/c.

Yes, their price for all this exceeded the on-line costs but I gave them as much business as I could to help them survive. Made a lot of good friends there too as it was a meeting place for the brothers of the leaf.

Sadly, they closed due to punitive taxation in our state as well as competition on the web. They are missed to this day. A class act in all respects!

Man, if you have a good B&M I'd say support it in whatever way you can. Tomorrow they may be gone.

Cheers,


RR

:|
 
I always want to ask if they would be smarter to try to sell in volume than by profit margin. In other words, mark those tins low and hopefully sell many of them instead of maybe only selling one or a couple at such a high price. Keep money flowing through the shop rather than sitting on it while waiting for that one sale. Keep customers guessing if you have new product because you often do. The more happy customers you have, the better the business. One guy walking off disgruntled at $19 is bad advertising.

On a similar note, a lot of retailers never learn that sitting on product and being stubborn about profit margin isn't smart business. They have pipe stands sitting in the shop for 5 years. Their idea of a sale is 10% off at X-mas. Better to practically give them away, get some cash out of them (no matter how little it might be), and put it into new product. Write it off as a loss on the taxes. Dead merchandise is negative in every way. Get it out of the shop. Take the few bucks and reinvest it in something new and that has greater potential to sell. If that doesn't sell, repeat.
 
Zeno Marx":x1g69n7t said:
I always want to ask if they would be smarter to try to sell in volume than by profit margin. In other words, mark those tins low and hopefully sell many of them instead of maybe only selling one or a couple at such a high price. Keep money flowing through the shop rather than sitting on it while waiting for that one sale. Keep customers guessing if you have new product because you often do. The more happy customers you have, the better the business. One guy walking off disgruntled at $19 is bad advertising.

On a similar note, a lot of retailers never learn that sitting on product and being stubborn about profit margin isn't smart business. They have pipe stands sitting in the shop for 5 years. Their idea of a sale is 10% off at X-mas. Better to practically give them away, get some cash out of them (no matter how little it might be), and put it into new product. Write it off as a loss on the taxes. Dead merchandise is negative in every way. Get it out of the shop. Take the few bucks and reinvest it in something new and that has greater potential to sell. If that doesn't sell, repeat.
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I've thought the same thing, although interestingly, the major retailer known as Guitar Center does believe in sitting on stock when it comes to their collectable vintage stuff. They'll put a crazy price on a guitar because they know that they can sit on it, and that price actually represents the price they hope to sell it for in about 4-5 years.

As for pipes, the old Tinder Box in Santa Monica (est. 1928) has stuff that looks several decades old, which is kind neat. Kind of like a time capsule, but then, I don' know if even they can continue that way indefinitely.
 
Situation is the same here in California. High taxes and growing anti-smoking legislation have forced many tobacco shops out of business over the past 10 years. Some are hanging on but they offer lots of other amenities to attract business (TV's, lounge, events, etc.)

And regarding the current online price discount, my advice is to start stocking up. The collection of sales taxes from internet purchases is right around the corner.
 
The problem with "volume sales" is simply that...very little volume to sell to.
Ask yourselves, how many pipe smokers do I know in my area? The number for most is a few to none.That's the reason so many pipe shops have become cigar shops or closed. Add on the taxes and it's a deal breaker for most. Then throw in the e-tailers and game over.
 
Look around, you don't see many pipe smokers out and about in the UK. So this means that pipe products are a niche market, which is okay for an online retailer but makes life very difficult for the average B&M.

Assume he does not own the freehold on the shop, and that he has probably been hit by rising rents as well as local business taxes. Add to that employee costs, and increasing costs for all the utilities. I doubt very much that he is using the profits from the sale of baccy to build a swimming pool on his private estate. More likely he is keeping his head just above water.

I have one B&M in my local area, and to be honest I think he is probably only just staying afloat.
 
shootist51":n7koxc8f said:
The problem with "volume sales" is simply that...very little volume to sell to.
Ask yourselves, how many pipe smokers do I know in my area? The number for most is a few to none.That's the reason so many pipe shops have become cigar shops or closed. Add on the taxes and it's a deal breaker for most. Then throw in the e-tailers and game over.
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I realize pipe smokers aren't going to be created by lowering prices. If I walk into a shop and the price of a tin is exorbitant, then I'm not buying anything. I'm not even one of these diplomats who will bite the bullet and buy one tin. I buy nothing. You throw a price at me that is competitive with what I can find online, then I'll buy 2, 3, 4 tins.

I feel for the stores. I truly do. This is already a rather expensive luxury in my world. We're both in crappy situations.
 
It's so bad that even my local has a couple bags of Stonehaven sitting on the shelf. If they can't even move a sought after tobacco off their shelves you know they're charging too much.

Maybe independent shops should make more of a smoker's lounge/club with a membership fee so you have a place to smoke (for those of us that don't smoke in the house and when it's too damn hot or too damn cold to go outside). A few cigar shops around town have nice lounges with big screen tvs but pretty much all shops don't allow or frown up or you just feel weird to walk in with your own stash and sit down and smoke and hang but not buy anything. Not sure if there would be enough demand for something like that. I don't really go to any of my local shops because I always feel obligated to at least buy something, i much rather buy the privilege to go there and smoke whatever and whenever I want and not feel like I have to walk out with something.
 
Like I said, I'd really like to support my B&M but that's just too much of a mark-up for me for that product! It's especially bothersome because I can get some of the same products from local cigarette stores considerably cheaper. This particular shop usually has customers in it and seems to sell a great deal of cigars (and occassionally has nice pipe-related events). It just shocked me to see Dunhills for that much (it would have been about $22 per tin with taxes). I can understand the stresses they are under, but c'mon -- you should at least price your products in a quasi-competitive way.
 
Our B&M store in Chattanooga, Burns Tobacconists/Chattanooga Billiards, sells a large amount of cigars, but also a small amount of pipe tobacco and pipes. You can smoke there and I've been able to get a start with a few decent tins. We're probably going to have to piggy-back on the cigar smokers indefinitely. I'm thankful that the cigar smoking owner seems to be letting a more informed pipe smoker do some ordering. The prices are only slightly higher than the web, which means that unless there's a huge sale, my local will win - given what shipping is these days. And they'll order just about anything if I buy a sleeve at a time.

Since they make money off of cigars, food, beer, and pool, I guess they can go for a decent margin instead of a huge one.

And while I was in there the manager asked if I knew another pastor who apparently has a men's Bible study with pipe smoking. When I found out who he was, I realized that he wasn't a friend of mine who is doing the same thing. Who would've thought that pastors would be a big part of a pipe revival!
 
As has been said: OVERHEAD !!!!! The only things keeping many tobacconists afloat are cigarettes and cigars, with pipes and pipe tobaccos as a neutral stock item at best. I recall visiting a reasonably well known pipe carver who also owns a shop in the downtown area of an upper mid-West city.........I was there for 2 hours chatting and perusing his reasonably good stock of pipes and tobaccos, including pipes he made himself. In that 2 hours I was the only one there interested in pipes, but he had a very steady stream of cigarette and cigar customers. (And, yes, I did buy a pipe; one of his own creations). The city: Minneapolis. The pipe-maker and shop owner: Rich Lewis. Great guy and great pipe-carver.
 
One B&M that is nearest to me is Larry Christopher's Pipe and Pint (Greensboro, NC). He has recently moved to a converted house after the NC Legislature made it illegal to smoke indoors. As the house is freestanding, the ban doesn't apply to him.

In his old shop he stocked 4 or 5 Xs the amount of tobacco and pipes that he does now. I could criticize him but pipe smokers only have themselves to blame as since they weren't purchasing these products, he had to reconfigure his inventory.

But as he has a great humidor, and as cigars are what I'm interested in, it doesn't matter to me.
 
For the most part, the prices I see in B&Ms for pipe tobacco tins are far less than I see on Ebay or Pipe Stud's website for equivalently aged tobacco. But that's just my opinion without doing any scientific research. :lol:

Jim
 
Having worked in a Tinderbox for a number of years I can say, from experience, pipes were a very very small part of the sales. I would always talk them up to anybody willing to listen. Always sit and explain how to do it as well. Pipe smoking is misunderstood and intimidating. It also carries a stigma. That being said, tobacco taxes are what was/is a major impetus to me buying in a brick and mortar.

The TB sold tons of cigars and yet couldn't come close to the online prices. We were a store of convenience. There was simply no volume on to be had to make up sales on the pipe stuff, though.

We had chairs to sit in and TV's to watch. I made practically noting but would take that job back in a second. In general, the Tobacco people were a good group to be around. The customers always felt comfortable to hang and smoke. Only rule we had was you had to buy from the store to smoke in the store. We had to put that in place because people ended up abusing our good will.

I tried to open up a smoke shop in the state I live in. Thankfully, funding fell through in the 11th hour. That was before the Govt started heavily taxing pipe tobacco in the same way they tax cigars. Cigarettes are taxed even more.

Sorry for my rambling, but I do miss my job and having a decent place to hang out and smoke and have a drink.

RIP TB :pale:
 
cigarstorejay":ebi2iust said:
Having worked in a Tinderbox for a number of years I can say, from experience, pipes were a very very small part of the sales. I would always talk them up to anybody willing to listen. Always sit and explain how to do it as well. Pipe smoking is misunderstood and intimidating. It also carries a stigma. That being said, tobacco taxes are what was/is a major impetus to me buying in a brick and mortar.

The TB sold tons of cigars and yet couldn't come close to the online prices. We were a store of convenience. There was simply no volume on to be had to make up sales on the pipe stuff, though.

We had chairs to sit in and TV's to watch. I made practically noting but would take that job back in a second. In general, the Tobacco people were a good group to be around. The customers always felt comfortable to hang and smoke. Only rule we had was you had to buy from the store to smoke in the store. We had to put that in place because people ended up abusing our good will.

I tried to open up a smoke shop in the state I live in. Thankfully, funding fell through in the 11th hour. That was before the Govt started heavily taxing pipe tobacco in the same way they tax cigars. Cigarettes are taxed even more.

Sorry for my rambling, but I do miss my job and having a decent place to hang out and smoke and have a drink.

RIP TB :pale:
Click to expand...
I have to agree. Having worked at and managed a TB in the late 70's through the early 80's, I can say that pipes and pipe tobacco were probably loss leaders in the shop. We made way more money off cigarettes, (mostly imports), and cigars than the pipe stuff. The items that made the most profit were the other non tobacco related items, (steins, and such). At one point before TB closed most of their stores, they had more gift items than pipes and tobacco.
 
cigarstorejay":0lrvyd5x said:
Having worked in a Tinderbox for a number of years I can say, from experience, pipes were a very very small part of the sales. I would always talk them up to anybody willing to listen. Always sit and explain how to do it as well. Pipe smoking is misunderstood and intimidating. It also carries a stigma. That being said, tobacco taxes are what was/is a major impetus to me buying in a brick and mortar.

The TB sold tons of cigars and yet couldn't come close to the online prices. We were a store of convenience. There was simply no volume on to be had to make up sales on the pipe stuff, though.

We had chairs to sit in and TV's to watch. I made practically noting but would take that job back in a second. In general, the Tobacco people were a good group to be around. The customers always felt comfortable to hang and smoke. Only rule we had was you had to buy from the store to smoke in the store. We had to put that in place because people ended up abusing our good will.

I tried to open up a smoke shop in the state I live in. Thankfully, funding fell through in the 11th hour. That was before the Govt started heavily taxing pipe tobacco in the same way they tax cigars. Cigarettes are taxed even more.

Sorry for my rambling, but I do miss my job and having a decent place to hang out and smoke and have a drink.

RIP TB :pale:
Click to expand...
I have to agree. Having worked at and managed a TB in the late 70's through the early 80's, I can say that pipes and pipe tobacco were probably loss leaders in the shop. We made way more money off cigarettes, (mostly imports), and cigars than the pipe stuff. The items that made the most profit were the other non tobacco related items, (steins, and such). At one point before TB closed most of their stores, they had more gift items than pipes and tobacco.
 
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