How Much Does a Tobacconist Earn? An In-Depth Analysis of Net Revenues

Sources of Income for a Tobacco Shop

The main earnings of a tobacco shop come from the sale of cigarettes, but it is essential to consider the wide range of related products: lighters, matches, rolling papers, pipe accessories and much more. These complementary items contribute significantly to overall turnover.

In addition to the world of tobacco, an important source of income is represented by payment services on behalf of the public administration. Tobacco shops collect taxes, fines, duties and bills, offering a useful service to the community and generating commissions.

A further income comes from state monopoly games, such as Scratch and Win, Enalotto and Superenalotto. The popularity of these games ensures a constant flow of customers and an interesting profit margin for the tobacconist.

Finally, the entrepreneur can expand the offer of the tobacco shop by selling stationery and newsstand products. A profitable alternative is to transform the business into a bar-tobacconist, also offering cafeteria services and thus increasing earning opportunities.

Average Annual Earnings of a Tobacco Shop

On average, a tobacco shop in Italia can generate an annual income of between €42,000 and €45,000. However, it is important to distinguish this figure from the average salary of a sales clerk, which is between €18,000 and €19,000 per year.

It is crucial to understand the earnings structure of a tobacco shop, as most products are subject to the State Monopoly. This means that the business retains only a percentage of the revenue from the sale of tobacco and games.

Cigarettes offer the highest percentage of revenue, around 10%. So, for every pack sold at around €5, the tobacconist earns 50 cents. The percentage on other products, such as lighters, Scratch and Win and slot machines, is around 8%.

Duty stamps, on the other hand, represent the product with the lowest percentage of profit, equal to 5%.

Net Monthly Earnings: What to Expect?

According to Istat data, a tobacco shop with a minimum turnover can expect an average income of around €1,300 net per month, once income and expenses have been calculated. It is important to emphasize that this is a purely indicative figure.

Actual earnings can vary considerably depending on the city and area in which the business is located. A tobacco shop located in a central area of Milano will presumably have a higher turnover than one in a small provincial town. Furthermore, as mentioned above, the offer of additional products and services (newsstand, stationery shop, bar) can significantly increase earnings.

The Tobacconist's Earnings on Cigarettes: A Focus

As we have seen, the earnings of a tobacco shop represent only a small percentage of the selling price of the products: about 10% for cigarettes, 5% for duty stamps and between 5% and 8% for other products (Lotto, Superenalotto, lighters, phone top-ups).

This profit margin is called "aggio" and corresponds to the tobacconist's gross revenue share on State Monopoly goods. Taxes and operating expenses of the business must then be deducted from this amount.

For example, for every pack of cigarettes sold at €5, the "aggio" for the tobacconist will be 50 cents. For each €16 duty stamp, the profit will be 80 cents.

How to Calculate the Real Earnings of a Tobacco Shop

Now that we have clarified the concept of "aggio", we have a more precise idea of the potential turnover of a tobacco shop. However, it is essential to remember that operating expenses must be deducted from the gross profit: rent, employee salaries, utilities, VAT, accountant and taxes.

To commercially evaluate a tobacco shop, a common method is to multiply the "aggi" obtained from the business by a coefficient that varies from 1.8 to 2.3. This coefficient takes into account several factors, such as location, clientele and growth potential.

Opening a Tobacco Shop: An Opportunity to Consider

After understanding the dynamics of a tobacconist's earnings, all that remains is to concretely evaluate the opportunity to buy and manage a tobacco shop. Taking over an existing business can be an excellent solution, both in a large city and in a small town.

The most complex part of this process is identifying the structure that best suits your needs and budget. Finding the right opportunity takes time and research.

If you are considering buying a tobacco shop, platforms like Sherlok can simplify your search. Sherlok offers a wide selection of tobacco shops for sale throughout Italia, helping you find the right opportunity for you.