How many potential markets are there for the development of new tobacco in Eastern Europe?
The 2023 Cannabis Trade Show in Czech Republic will be held from November 3-5 at the PVA Expo Center in the Czech capital, Prague. This smoke-free themed trend event is also of concern.
Prague is the largest city in the Czech Republic, known as the "Golden City", located in the center of the European continent. The Voltava River meanders through the city, with an extremely convenient transportation hub network and close connections with surrounding countries.
As an important market adjacent to Germany, the Czech Republic has attracted the attention of many tobacco companies, including e-cigarettes. According to the organizers, this year's Czech trade show Cannafest will have a record high number of exhibitors and exhibition area. And 70% of these exhibitors are from foreign countries. This time, we are targeting CBD and also seeing the attention of many tobacco companies and related channel providers, focusing on the future development of green and healthy tobacco, including e-cigarettes. In the Czech Republic, there are many tobacco exports to countries such as Italy, Slovakia, Sweden, and the United Kingdom every year. Most of its tobacco suppliers come from countries such as China and Germany. These all indicate that the Czech Republic is a market with a strong atmosphere for tobacco.
What are the opportunities in the electronic cigarette market in Czech Republic?
What are the characteristics of the population, consumption environment, channel size, brand, and category?
Due to the lack of clear electronic cigarette regulatory laws in the Czech Republic, which are basically EU standards, the electronic cigarette market is very free and subject to few restrictions.
In terms of population. According to a set of data released by the local Ministry of Health, smoking is very common in the Czech Republic. In 2022, about 24% of the population in the Czech Republic used electronic cigarettes, about 6.6% used heated cigarettes, and about 2.8% used nicotine bags. This indicates that the frequency of new tobacco use in this market is very diverse.
Another key point is that this country also has a large number of tourists every year, bringing consumer groups to the e-cigarette market. At present, Czech e-cigarettes are biased towards young people, with an average local salary of over 10000 yuan, making them one of the most economically developed regions in Eastern Europe.
It is noteworthy that since 2022, Czech Health Minister Vladimir Valleck has stated that he will follow the UK in promoting e-cigarettes and abandon the "abstinence policy" he has been implementing for many years. On the agenda of the Czech presidency of the European Council, the Czech Ministry of Health plans to make pest reduction policies the main promotional item. This means that the Czech Republic may become the biggest advocate of EU harm reduction policies, deeply influencing the direction of EU health policies in the coming years, and the harm reduction concept will also be promoted on the larger international stage.
And the tobacco channel may also be the key to expanding the e-cigarette channel. Because professional retail stores such as tobacco stores and e-cigarette stores are the most popular channels. In addition to many tobacco shops, there are also many professional cigar shops in the local area.
The Czech Republic, with a population of over 10 million, has over 2.4 million smokers. The market space for its e-cigarettes is expected to have just begun.
Is it the right time to become a Czech? What brands can you see locally?
The Czech Republic currently has a relatively new and free e-cigarette environment, which is an opportunity for many Chinese e-cigarette factories and brands.
At least for now, the local brand layout in Czech Republic is relatively small.
Some data feedback from Czech e-cigarette stores. For example, according to data from Czech Vapor and eliquidshop stores, most of the Czech disposable brands are Dinner Lady, ELF BAR, suorin Bar, Leo Nano, OXBAR, Nasty Fix, KIWI, Lost Mary, IVG, VUSE GO, etc. The main products are all 600 ports that comply with the EU TPD rules. At the same time, in the Czech market, you find that Love Miracle is pushing their replacement, which is Elf Bar ELFA.
In terms of equipment, there are mainly brands such as VOOPOO, OXVA, UWELL, SMOK, aspire, Geekvape, etc.
However, the Czech Republic is also selling hot tobacco oil, such as JUST justice, Adam's vape, MONKEY, INFAMOUS and other brands.
Local e-cigarette channels, such as eliquidshop, are large, with over 10 stores and wholesalers. They are distributors of many e-cigarette brands, including ELF BAR, Smoktech, JOYETECH, GeekVape, OBS, Apire, Innokin, Sony, and others.
At present, seasoning may be restricted in the Czech Republic.
In June of this year, Czech President Peter Pavel signed an amendment on protecting public health, which would terminate the sale of HNB with spices. The law is based on mandatory EU directives and will come into effect on October 23rd. Retailers will not have a transition period to sell remaining inventory, but there was no mention of e-cigarettes at the time. Anton í n Berdych, a spokesperson for the local Electronic Cigarette Association (KEVAP), warned at the time that the taste ban could lead people to make their own e-cigarette refills.
Opening the Czech market
In May of this year, the Czech Republic also announced the inclusion of e-cigarettes in regulation and the imposition of a "consumption tax" on e-cigarettes. The government plans to impose a new tax on e-cigarettes, and the collection standards will refer to TPD. It's just a matter of time, the tax rate may be between 0.1 to 0.35 euros per milliliter.
But compared to electronic cigarette taxation, traditional cigarette taxation, including HNB, is constantly increasing, which may provide market space for electronic cigarettes.