Business is up to snuff at Swedish Match North America -- that's snuff tobacco. A subsidiary of Stockholm-based Swedish Match AB, the company (SMNA) primarily makes and sells moist snuff and, increasingly, General-brand snus (a spit-free, smokeless pouch) in the US. SMNA also ranks as the largest manufacturer of US chewing tobacco; Red Man is the country's #1 selling label. Snuff brands include Longhorn and Timber Wolf. Among other offerings, SMNA makes mass market cigars, sold under the ubiquitous White Owl and Garcia y Vega brands, and matches and Cricket brand disposable lighters. The company expanded its presence in the tobacco space when Swedish Match acquired premium cigar maker General Cigar (2005).
In early 2011 Swedish Match restructured its organization and created half a dozen new operating units. SMNA's performance is reported under Swedish Match's US Division, which controls local marketing and customer partnerships, and distribution of snus, snuff and chewing tobacco, as well as mass market cigars, in the US. The change aims to strengthen business with both customer and consumer, as well as its position vis à vis such competitors as Reynolds American subsidiary American Snuff, UST, and North Atlantic Trading Company's National Tobacco. North America is the world's largest moist snuff market, and SMNA ranks as the third largest moist snuff and snus company.
Despite a small decline in snuff demand during 2010, moist snuff sales inched up 3% over the prior year thanks to new and improved product roll outs coupled with higher prices. Mass market cigar sales fared better, growing more than 20% on a 35% increase in volumes, driven by a shift in product mix from large to smaller cigars.
Going forward, SMNA is focusing its resources on expanding its presence in the snus market. To that end, in 2012 its market-leading General brand of Swedish snus entered seven new US markets, including Los Angeles and New York, where it's sold in convenience stores and tobacco outlets. Unlike Altria and Reynolds American, which make the Marlboro and Camel brand-snus, respectively, SMNA's General brand is more expensive. The company's target market is different, too; SMNA courts smokers who have (or want to) quit, as opposed to those who choose snuff when smoking is banned.
▲ Show Less▼ Show Full Description