Get Prepared for the Possibility of Selling Cannabis

Pandemic lockdowns led to customers stocking up on their favorite products wherever and whenever they could fi nd them, and the data refl ects this: Smoking accessories saw a massive 23.5% increase in dollar sales and a 16.3% increase in unit sales for the latest 52 weeks ending April 18, 2021, according to IRI Total U.S. Convenience data.

Lighters specifi cally saw a 6.1% rise in dollar sales for the period.

While total store trips were down, basket sizes were up. Plus, stay-at-home orders meant those who smoke — tobacco or cannabis — had fewer restrictions for doing so.

Ultimately, it proved a perfect storm for the lighter subcategory.

Sayre, Pa.-based Dandy Mini Mart’s c-stores were up about 38% in smoking accessories for the year, confi rmed Vice President of Food Service and Merchandising Dyson Williams, who attributed increases to an overall shift in consumer habits. “We saw cigarette sales rise during the early part of the pandemic,” he said. “Also, people wanting to make less trips to specialty stores, etc.”

The c-store chain operates 65 stores in Pennsylvania and New York.

Meanwhile, Indiana-based Good Oil Co., which operates 15 Good to Go stores in Indiana and one in Illinois, saw an even bigger early increase in accessories sales — 41.48% — according to Mike Jones, the c-store chain’s director of marketing and foodservice.

Good to Go recently made all of its SKUs available for delivery through Vroom Delivery, including tobacco and smoking accessories products.

And while, for the latest four weeks ending April 18, 2021, smoking accessories began to fl atten, up just 1.8% in dollar sales and down 2.6% in unit sales, lighters specifi cally saw a dollar sales rise of 31.1% for the same four weeks, with unit sales up 19.7%.

What’s more, many c-stores are still reporting strong tobacco accessories sales. Good to Go, for one, shows a 16% increase for the fi rst four months of 2021.

MERCHANDISING OPPORTUNITY

At Springfi eld, Mo.-based Gier Oil’s Eagle Stop Stores, with more than 50 c-store locations in the state, smoking accessories are going strong, thanks to an expansion of the subcategory in recent months. “Lighters are doing great,” said Nick Lepper, Eagle Stop’s category director. “We have expanded from the standard, plastic spark-wheel lighter into electronic and torch-style lighters — single, double and triple fl ames.”

Lepper took over as category director at the start of the year. With the entire tobacco category, he noted, the chain’s biggest challenges are organization and space — for lighters, counterspace in particular is always a concern, he said. “In an effort to maintain a clean look for the counter and offer consumer-demanded products, I have worked with our partners to acquire racks for the stores that will merchandise all styles in the incremental space,” Lepper said.

With lighters and beyond, opportunity still exists for c-stores to cater to legal cannabis smokers.

Recreational cannabis is now legal in 17 states and Washington, D.C. And a number of others have decriminalized its use. According to the Pew Research Center, this means 43% of U.S. adults now live in a place that has legalized cannabis for recreational use. And CivicScience survey data from the fi rst quarter of 2021 shows that nearly 70% of U.S. adults (ages 21 or older) would support the legalization of marijuana in their respective states.

Plus, Euromonitor International estimates more than 360% growth of the sector by 2025, totaling more than $53 billion in sales.

fast facts:

• Smoking accessories saw a 23.5% increase in dollar sales and a 16.3% increase in unit sales for the latest 52 weeks ending April 18, 2021, according to IRI Total U.S. Convenience data. • Sales of smoking accessories have begun to fl atten, up just 1.8% in dollar sales and down 2.6% in unit sales for the latest four weeks. • There’s opportunity to cater to the cannabis consumer, but it depends heavily on the area and the customer base.

Smoking accessories benefi t from stay-at-home orders, specialty shops closures

Product Dollar Sales, 52 weeks Unit Sales, 52 weeks Dollar Sales, 4 weeks Unit Sales, 4 weeks

Current 1-Year % Change Current 1-Year % Change Current 1-Year % Change Current

1-Year % Change

Smoking Accessories $388 M 23.5% 199 M 16.3% $31.8 M 1.8% 16.0 M -2.6%

Lighters

$612 M 6.1% 333 M -1.0% $52.2 M 31.1% 27.1 M 19.7%

Source: IRI Market Advantage - TSV, Total U.S. Convenience data for the 52 weeks ending April 18, 2021

Some stores, like Chicago-based Foxtrot, are already offering modern, cannabis-related accessories like a hand-blown glass smoking pipe, listed in the Lifestyle section of the chain’s website, which “offers a sophisticated, playful and smooth smoking experience.”

But, like all things, with limited space, it comes down to knowing your customer base. For many c-stores, traditional lighters remain the top sellers. CSD “Lighters are doing great. We have expanded from the standard, plastic “ spark-wheel lighter into electronic and torch-style lighters — single, double and triple fl ames. and triple fl ames.

- Nick Lepper, category director for Gier Oil’s Eagle Stop Stores