Impact for retailers of law that has the FDA regulating tobacco..

June 25, 2009 - President Obama on Monday, June 22nd signed the Family Smoking Prevention & Tobacco Control Act that provides for the Food and Drug Administration (FDA) to regulate tobacco.

The FDA will control what goes into cigarettes, how they are packaged and labeled and how they are marketed and sold, among other powers. Although retailers do not all share the same level of concern for all aspects of the new tobacco reality, they all have concerns.

A recent Kraft/CSP Daily News poll asked, "What do you think is the worst thing that could realistically result from FDA oversight of tobacco products?" Of the nearly 160 respondents, nearly 22% said "uncompromising merchandising restrictions"; about 11.5% said "a general decrease in sales"; 11% said "a single manufacturer gaining overwhelming control of the industry"; 6.5% said "a national ban on tobacco sales"; almost 8% said "overly dramatic warning labels"; more than 3% said "local bans on tobacco sales"; 40% said "all of the above"; nearly 2% said "other;" and about 3% said "none."

CSP Daily News conducted a random sampling of a few retailers to get their reactions to FDA tobacco control. Below are a couple of the comments.

Terry Gallagher Jr., president, TCSC (Smoker Friendly and Gasamat), Boulder, Colo.:

"I think they've proven around the world that the graphic warning labels don't have much impact. Most consumers know what they're buying and the risks and choose to make that decision. There's nobody out there who uses tobacco products who aren't aware of the risks associated with it. "The impact to the consumer is going to be the continued escalation of cost of goods. They'll notice that."

"I think there will be some silver lining for us as it starts to unfold. What kind of input can we have as retailers in the rules-making? How do we play now that the game is changed? We don't really know until they start their rules-making. More government is never better."

Jim Smith, president and CEO of the Florida Petroleum Marketers & Convenience Store Association (FPMA):

"Everyday I am more and more amazed at the intrusion by the federal government into the lives of small business owners. Though to early to tell what the full impact will be of FDA control of tobacco, I believe history is a great teacher. I can think of no government effort that does what it was intended to do except for our military. Every other program hits the bottom line of every retailer, and this will be no different."

For more comments from retailers click on reference below.

Reference: Retailers React to Regulation FDA control over tobacco brings mixed reactions from convenience retailers by CSP Staff, CSP Daily News, 6/24/2009.