British American Tobacco is set to introduce direct sales to retailers as part of the company’s new marketing and distribution model in Poland. It plans to create up to 700 new jobs in Poland, the company announced.
“There are nearly 120,000 outlets where tobacco products are sold in Poland. The new model will allow us to reach many of them directly,” said Antal Bekefi, the president of BAT’s Polish branch.
The new system will be operational by the end of October 2013. Over the next few weeks the company will hire 500 new people, mostly in sales, finance and accounting. New distribution centers all over the country, operated by an outside logistics firm, will provide jobs for another 200 people, according to BAT’s estimates.
The company had been preparing the new model for a year prior to implementing it, during which time it “designed and built the logistics network that will support the new distribution model, procured the necessary equipment for the new sales force and built the dedicated IT system,” the company wrote in a statement.
The new model may be the company’s response to Poland’s ever-increasing taxes on cigarettes, which by inflating cigarette prices and encouraging illegal import of cheaper tobacco from eastern neighbors, have been driving the company’s sales down for years.
In early September the government announced its draft budget for 2014 which includes yet another hike in excise duty for cigarettes, which is set to go up by 5 percent (the same rise as in 2013). Poland is scheduled to reach EU levels of excise duty on tobacco products, which stand at €90 for each 1,000 cigarettes, by 2018. Currently the levy in Poland amounts to €87.50.
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