Massive rise in tobacconists fuelling Sydney’s youth vaping crisis

Despite it being illegal for convenience stores and tobacconists to sell vapes containing nicotine, a Daily Telegraph investigation reveals many are still doing so. Watch the video here.

The number of retailers selling cigarettes and vapes in NSW has soared by more than 50 per cent – or 6500 outlets – since 2018, with the number of new tobacconists surging amid booming e-cigarette sales.

NSW Health data, obtained by The Daily Telegraph, shows notifications of intention to sell tobacco and e-­cigarettes reached record levels in 2023, at a rate of 124 stores a month, up from 111 a month in the previous year and 98 in 2021.

From the start of 2018 to the end of September last year, 6551 notifications were received, taking the state total to 19,215, covering everything from tobacconists to petrol stations to pubs and ­supermarkets.

One of the fastest-growing retailers in that time has been specialist tobacconists.

Industry No. 1, Tobacco Station Group (TSG), now has 71 outlets within 25km of Sydney’s CBD alone.

TSG has filled shop vacancies created by the Covid-19 pandemic and exploited demand for vapes.

A man vaping at the Sydney airport on Thursday. Picture: Justin Lloyd

The chain has rapidly expanded to more than 550 stores nationwide from 340 in 2015 – an annual growth rate of about 7 per cent.

Its official sales reached $1.26bn in 2023, according to analysts IBISWorld.

Smaller rival Freechoice – owned by controversial entrepreneur Travers “Candyman” Beynon and his family – has also increased revenue by about 50 per cent since 2018 to $214m, The Daily Telegraph has learned.

Freechoice has about 270 stores across Australia.

However, along with ­smoking rates in long-term decline, the Department of Health has forecast that ­tobacconists “will incur ­significant reductions” to cashflow from this year because there is “no longer … any legal retail ­market for vapes outside pharmacies” under reforms that kicked in on January 1.

The law changes ban the importation of all disposable vapes, regardless of whether they contain nicotine.

TSG Burwood, a tobacco shop that is openly selling vapes.

Product on the shelves at TSG Burwood.

It has long been illegal for the nation’s 7000 convenience stores and 1600 tobacconists to sell vapes containing ­nicotine, but many have done so anyway.

According to federal Department of Health analysis released this week, outlets have been meeting “surging demand” by trading in “under-the-counter vapes that ­contain nicotine, that sometimes are not labelled as ­having nicotine, and that can only be purchased with cash to reduce traceability of the transaction”.

More than 180,000 illegal vapes were seized in NSW in 2022.

Several independently owned TSG franchises in Sydney were fined by authorities last year for attempting to import nicotine vapes.

The chief executive and founder of convenience store chain EzyMart, Maher Magableh, told The Daily Telegraph he believed Sydney’s CBD could only support half the number of convenience stores and tobacconists which were currently trading.

“In the CBDs, especially in Sydney, the amount of store openings, it’s much over the city’s needs,” Mr Magableh said.

Much of the recent growth had occurred because there were so many retailers that shut down during Covid – with tobacconists and convenience stores becoming the main source of new tenants for ­landlords.

In the Sydney CBD, there was less than 70m separating some outlets, Mr Magableh said, adding that the situation was a “mess”.

“Half of the stores is extra than the CBD needs,” Mr Magableh added.

“I believe tobacconists will disappear within a few years.”

Tobacconists have taken over rental vacancies left behind after Covid.

He argued that EzyMart’s business model was different, because it sold essentials.

He claimed EzyMart did not sell nicotine vapes.

That claim was proved to be untrue during a Daily Telegraph investigation on Thursday, when our reporter was able to purchase two nicotine vapes at two EzyMart stores in Surry Hills.

Mr Magableh said EzyMart – which is the biggest chain of convenience stores nationally, with nearly 500 outlets – could not compete with tobacconists’ cigarette prices.

EzyMart’s sales of smokes were down by 70 per cent in Sydney compared to before the pandemic, he said.

In Melbourne, the fall had been 80 per cent.

Freechoice did not respond to repeated requests for comment. Its holding company’s revenue has risen from $144m in 2018 to $214m last year.

Lucciana Beynon and Travers Beynon, whose family owns the Freechoice business chain.

TSG’s main shareholder is Melbourne man Rick Bayliss, who owns 65 per cent of its shares. Many existing TSG franchises are listed online as being for sale.

It comes as health experts say the increasing availability of vapes was underpinning the rise in young people taking up the vice – prompting calls for better regulation of the state’s tobacco retailers.

A City of Sydney spokesman said tobacconists do not need any approvals from the council before opening up a new store.

“Before a business starts selling tobacco, non-tobacco smoking products or e-cigarettes, it needs to notify NSW Health and apply for a retailer identification number,” they said.

NSW Small Business Minister Steven Kamper also does not have oversight over approvals for how many tobacconists can open in any one area

TSG Burwood, which is still openly selling vapes, despite bans on vape devices. Picture by Max Mason-Hubers

What vapers says

On a Thursday afternoon in Sydney’s Bondi Beach there is no shortage of young people carrying vapes alongside beach towels and surfboards.

One teen, who had a vape tucked into her bikini bottoms, told the Telegraph she did not vape.

Luca Cruzado, 20, at Bondi on Thursday, switched cigarettes for vaping after a trip to hospital. Picture: David Swift

He says vapes are easily available. Pictures: David Swift

Luca Cruzado, 20, vapes a non-disposable vape to minimise the health impacts after switching from cigarettes but said the easy availability of vapes and cigarettes had gotten him hooked in his teens.

“It was so easily available,” he said.

“I was smoking before and I had seven a day and I got sent to hospital so I switched to the vapes.”

His friend Sophie Pinkerton, also 20, is 16 days vape-free after getting addicted as a teenager.

Ms Pinkerton started with cigarettes before switching to disposable vapes as a 14-year-old.

“The hardest part isn’t the nicotine, it’s how accessible it is. I worked next to a vape shop, there was no way I was giving it up,” she said.

“Everyone has them at parties and then you get drunk and then you think I’ll have a hit.

“I was 14 ordering vapes to school. I quit 16 days ago (but) have quit many times.”