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Managing director of tobacco, beverage and convenience store research at Wells Fargo Securities LLC, Bonnie Herzog, calculated the deceleration rates at approximately 2 percent to 2.5 percent for 2016, and at 3.5 percent for 2017. “It’s an industry in secular declines,” she said during her presentation at the expo.

“It’s an industry in secular declines” Bonnie Herzog,Managing director of tobacco, beverage and convenience store research at Wells Fargo Securities LLC about the tobacco industry.

Referring to Phillip Morris International (PMI) and British American Tobacco (BAT), Tobacco Talk respondents pointed out that “neither of the Big Two [tobacco companies] seem interested in rocking the boat at this time”, adding that the tobacco manufacturers are “trying to grab business” as cigarette sales remain on the decline.

Vaping sector seems more stable

As the debate turned to vaping, it was pointed out that this industry is expanding from just electronic cigarettes, to manufacturing heat-not-burn products and other reduced risk products (RRPs).

For the vaping industry, Herzog forecasts up to $4.4 billion in sales by 2017, from $4.1 in 2016, and up to $10 billion by 2020.
According to Herzog the general consumer attitude towards these products is still a “lukewarm” one, and with the latest deeming rule imposed by the FDA, retailers are also uneasy. However, she still predicts growth for this industry. Herzog forecasts up to $4.4 billion in sales by 2017, from $4.1 in 2016, and up to $10 billion by 2020.

Reliable positive predictions

When taking in consideration all the challenges that the vaping industry has been facing, the above positive forecasts undoubtedly bring relief and hope. Executive Director of Smokefree Pennsylvania, Bill Godshall commented on Herzog’s predictions on ECF forum, saying that up to now, he has always found her predictions to be quite accurate and consistent.