Retailers Take Wait-and-See Approach After CVS Announces it Won’t Sell Tobacco

No other major retailers have joined CVS in pledging to pull tobacco from store shelves, the Associated Press reports. CVS, the nation’s second largest drugstore chain, announced earlier this year it will stop selling tobacco products by October 1.

Major retailers want to see what happens after CVS stops selling tobacco, before deciding how to proceed, the article notes. The company has more than 7,600 retail stores. Public health advocates have pressured retailers for years to stop selling cigarettes and other tobacco products. CVS says its annual sales of tobacco products total about $2 billion, or about 1.6 percent of the company’s revenues in 2012.

The company’s announcement caught many people in the retail industry by surprise, the article notes. CVS stock has risen about 11 percent since it made the announcement. Many analysts predict it is unlikely other drugstore chains will make a similar decision to pull tobacco products. Walgreens CEO Greg Wasson last month said that instead of stopping sales of tobacco products, his company would focus on helping people quit.

Some discount chains, such as Family Dollar, have added tobacco to their stores in recent years.

There are several reasons retail chains may want to consider dropping tobacco sales, according to the AP. The cigarette business faces tax increases, smoking bans, health concerns and social stigma. The number of Americans who smoke continues to drop. In addition, selling tobacco products runs counter to the healthy image drug chains want to project.

In March, the attorneys general of 28 states and territories urged major retailers to follow the lead of CVS and stop selling tobacco products. They sent letters to Rite Aid, Walgreens, Kroger, Safeway and Walmart, which are among the nation’s biggest pharmacy retailers.