Groups protest Family Dollar tobacco sales

A group of anti-tobacco activists is protesting Matthews, N.C.-based Family Dollar's recent decision to start selling cigarettes, saying the stores will push more cigarettes on low-income consumers, who already smoke more than average. Family Dollar responded that its decision was driven by customer demand. "We're not in the business of judging our customers for their purchases," said Family Dollar spokesman Joshua Braverman.

"It's just another category where we add the convenience for them." But in a letter to Family Dollar CEO Howard Levine, the Campaign for Tobacco-Free Kids and the Break Free Alliance said the increased availability of tobacco at Family Dollar's 7,100 stores will add to customers' health problems. "Selling tobacco to your customers will make it easier for them to become addicted or sustain an existing addiction," said the letter, co-signed by the groups' directors. "The fact that your customer base is comprised of low-income families makes your decision even more troubling."

 The groups said about 26.9?percent of low-income adults smoke, compared to 19.3?percent of the total adult population. Braverman told McClatchy Newspapers that Family Dollar customers smoke at a higher rate than the general population, which was one factor driving the decision to start selling tobacco. "Our customer over-indexes as tobacco users," Braverman said. "We know they're going to other retailers to purchase their tobacco products."

 In March, Family Dollar reported a record $136.4?million in profits for the second quarter, up from $123.2?million a year ago. Total sales at Family Dollar were $2.46?billion, up 8.6?percent. Family Dollar also has been bulking up its selection of food and drinks. The rationale is similar with tobacco: Executives hope to spur more frequent trips, and allow customers to cross off more of their shopping list at Family Dollar. Levine told analysts at a retail conference this week that while tobacco is a low-profit business, having cigarettes in the store will draw customers who would have shopped elsewhere before.

 "The whole strategy behind adding tobacco was not a basket-builder," he said, using a retail term to describe how much customers buy. "It was very simple. It was to get a trip in the Family Dollar that we had not had before. ... That's what we hope to accomplish, is to get him or her into our store." Family Dollar also has been competing more directly with mega-retailers such as Wal-Mart and traditional grocers as customers look to save money, and both those store categories sell tobacco.