Tobacco in bosnia herzegovina


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Tobacco in bosnia herzegovina

  1. 1. Tobacco in Bosnia-HerzegovinaCigarettes dominate tobacco, accounting for 99.6% of sales by value. The initial part of thereview period saw the introduction of VAT and a unified indirect taxation system. During thesecond half of the review period, the adoption of a new law on excise was the most importantdevelopment. The new law primarily targets cigarettes, setting the basis for a steady increase inexcise from mid-2009. The goal is to bring cigarette prices up to average EU levels during thecourse of the next decade.Profitability declinesAfter an initial cigarette excise increase in July 2009, a second increase took place in January2010 and again in January 2011. The minimal annual excise increase, by law, is BAM7.5 per1,000 cigarettes. Cigarette manufacturers and distributors have to cope with decliningprofitability. They have been able to keep price increases to a minimum, but profit margins arevery much reduced. The next excise increase is likely to hit consumers the hardest, which iswhen real opportunities for cigarette substitutes, especially smoking tobacco, will arise.Leading manufacturers manage to keep price increases to a minimumCigarette manufacturers dominate tobacco products sales. The largest regional manufacturer,Adris Grupa (NBO: Rovita doo), and largest domestic manufacturer Fabrika Duhana Sarajevoare the leaders. Consumers remain loyal to brands with a long tradition, especially Drina andRonhill. Rovita and FDS managed to keep price increases during 2009 and 2010 to a minimum,which was appreciated by their consumers and especially reflected in the growth of Rovita’smarket share in 2010.Bosnia-Herzegovina in Tobacco Market ReportReport Details:Published: April 2012Price: US$1900In 2010, convenience was still the most influential factor in the structure of the retail distributionlandscape. Three convenience focused channels - convenience stores, kiosks and independentsmall grocers - dominate retail distribution of cigarettes in Bosnia-Herzegovina. For other lessconventional products like cigars and smoking tobacco, the retail distribution pattern issomewhat different, emphasising the role of more specialised retail outlets or horeca, in case of
  2. 2. cigars. Recently adopted laws have imposed new restrictions on the distribution of tobaccoproducts, but these are yet to be fully enforced.Decline of traditional tobacco productsOver the forecast period, cigarette prices will continue to rise, driven by growing excise duty.Consumers are likely to become increasingly interested in substitutes, especially smokingtobacco, as well as cigarettes from illicit trade. Smoking bans are likely to become stricter, whichwill further discourage smoking and increase demand for smoking cessation aids and/or smokingsubstitutes, ie e-cigarettes or even smokeless tobacco.Request a Sample for or Inquire before buying the report @ TiwariTX, Dallas North - Dominion Plaza,17304, Preston Road,Suite 800, Dallas 75252.+ 1 888 391 5441sales@reportsandreports.comConnect With Us: