ONTARIO – Imperial Tobacco’s new direct-to-retail distribution system is leaving some retailers with little to no product, reports the Guelph Mercury.

In May, Imperial Tobacco announced that it would offer direct-to-store delivery throughout Canada beginning in August. However, some of the tobacco company’s retail customers are reporting product shortages or that they are out of stock.

According to Amir Ali, owner of Bluebird Variety, his store had completely run out of Imperial Tobacco products on September 12, even though he had placed an order last Wednesday that was scheduled to arrive by Friday, notes the newspaper.

Bob Hefkey, owner of the Hasty Market, told the newspaper he had to order 100 cartons at a wholesaler as he’s still waiting for a shipment from Imperial Tobacco to arrive. “They come along last week and took an order from me for 100 cartons of cigarettes on Friday to be delivered Monday, and I haven't seen them yet,” he said.

Meanwhile, Imperial Tobacco spokesperson Catherine Doyle told the newspaper that the company’s new delivery system is complicated and will “take a little while to iron out the kinks.”

“This is a massive switch in terms of a business model for us and a distribution model for us,” Doyle said, noting that the company wants to make sure its customers receive product in “a timely manner.”

Doyle added that the company’s direct-to-retail system made its first delivery on September 5, noting that stores can still purchase product from a wholesaler, but those who use the new delivery method can save up to $4.00 per carton. She noted that the response from retailers who have signed up for direct-to-retail delivery has been “outstanding” so far.

Dave Bryans, president of the Ontario Convenience Stores Association, commented to the newspaper that he has other concerns. For example, suppliers of convenience store merchandise, including cigarettes and snack foods, share transportation costs with wholesalers and retailers.

“Someone has to incur the cost of getting the rest of those goods to the convenience stores…. “It used to be a co-op on the truck. Now the biggest player has left it, so the cost of goods is going to go up,” Bryans told the newspaper, adding, “It's just a change of business, and there's not much we can do about it.”