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Say cheese: Cigarettes no longer No. 1 seller in commissaries

Jul. 19, 2011 - 12:11PM   |   Last Updated: Jul. 19, 2011 - 12:11PM  |  
Cheese has overtaken cigarettes as the top-selling category in military commissaries. The shift marks another milestone in the long slide of tobacco sales in those venues.
Cheese has overtaken cigarettes as the top-selling category in military commissaries. The shift marks another milestone in the long slide of tobacco sales in those venues. (Photographer's Mate 1st Class Shawn P. Eklund / Na)
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Cheese has overtaken cigarettes as the top selling item category in military commissaries, another milestone in the long slide of tobacco sales in those venues.

By the end of April, cheese had edged out cigarettes with $106 million worth of sales in the previous 52 weeks, compared with $105 million for cigarettes, data from the Defense Commissary Agency show.

Cigarette dollar sales in commissaries dropped 12 percent overall compared with the same period in the previous year, more than the 8 percent drop in overall commercial cigarette industry sales, according to commissary officials. The number of cartons sold was down by 16 percent, compared with an 8 percent drop in carton sales industrywide.

Tobacco sales overall in the first nine months of this fiscal year also are down 12 percent compared with the same period in the previous year.

The picture is slightly different in the exchange stores. Tobacco sales in Navy exchanges are holding their own, and sales of other tobacco products, such as cigars and smokeless tobacco, have increased by 20 percent.

Navy stores sold 4.1 million units of these products in 2010, compared with 3.4 million in 2009, according to Navy Exchange Service Command spokeswoman Kristine Sturkie. Cigarette carton sales were down about 1 percent to about 10.9 million in 2010.

Tobacco sales through the Army and Air Force Exchange Service are down about 2.4 percent this year compared with the same period last year, according to AAFES spokesman Judd Anstey.

But those figures also include commissary sales on Army and Air Force bases because the exchange services act as concessionaires to commissaries, providing all their tobacco.

Traditionally, few Navy and Marine commissaries have sold cigarettes. Since tobacco sales have dropped about 12 percent in commissaries, it is unclear whether sales have actually increased in AAFES exchange stores, given the comparatively small decline in overall AAFES tobacco sales.

In contingency areas, including Iraq and Afghanistan, AAFES saw a 13 percent drop in tobacco sales in 2010, and the trend continues this year, although fewer troops were in those areas than the year before.

At press time, information was not available from Marine Corps exchange officials about their tobacco sales.

The national trend in tobacco sales has seen a decline in cigarette sales while smokeless and cigar sales have been growing, said Greg Mathe, spokesman for Altria Group Inc., which owns Philip Morris USA, U.S. Smokeless Tobacco Company and John Middleton.

A nationwide push to snuff out smoking, a concerted education campaign on many fronts in the military community, and tightened restrictions on smoking areas all are likely contributors to declining sales in commissaries.

For years, commissaries sold tobacco products at steep discounts, up to 76 percent below commercial retail prices. Discounts in the exchanges ranged up to 51 percent. But in 1996, defense officials directed commissaries to reduce the tobacco discount, which boosted prices to the same level charged by the exchanges.

The current policy, dating from 2000, requires commissary tobacco prices to be discounted no more than 5 percent below the most competitive commercial price in the local community.

In 1996, almost $465 million worth of tobacco products were sold in commissaries; in 2010, that figure was down to $124.5 million.

According to the Pentagon's 2008 Survey of Health-Related Behaviors among active-duty members, 31 percent said they had smoked in the last 30 days, down from 34 percent in 2002.

In 1980, 51 percent of troops surveyed said they smoked.

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