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Generic Cigarettes Are a Big Draw in a Tough Economy

April 26, 1993|ASHLEY DUNN

Storming into a cramped Mobil gas station at the corner of Alvarado and Glendale avenues, Junko Anderberg of Echo Park pulls her dented green Chrysler into the first available spot and rushes to the cashier's booth for a pack of cigarettes.

She is not looking for just any cigarette but what is possibly the best bargain in Los Angeles today: Private Stock brand at $1.05 a pack.

She rips off the top of the plain white box and takes a super puff.

"I figure if you're going to do something bad to your body, you might as well buy the cheapest brand you can find," she says before jumping in her car and rushing off to the grocery store.

As the recession continues its persistent and numbing march across Southern California, its touch is felt even here, among the die-hard and thoroughly addicted smokers.

After what in some cases is decades of loyalty to brands such as Marlboro and Winston, smokers are being drawn to a new kind of cigarette--selling for about half the price of the premium marks--with blunt names such as Basic and Full Flavor.

These smokers are a tough, no-nonsense breed, forced to adjust to the changing economic realities. Slick marketing campaigns have no effect on their habit. They don't care what cowboys smoke and they certainly don't care what camels smoke.

In many ways, they don't even care what the cigarettes taste like, which ranges from "pretty nasty" at times to "acceptable," in Anderberg's estimation.

What is important is that the cigarettes are cheap and made of tobacco, and thus contain the necessary addictive chemicals.

How cheap is cheap?

The sign hanging on the window of the gas station's bunker-like cashier's booth gives a rough idea:

Major brands: $1.95

Generic brands: $1.70

Discount generics: $1.40

Special generics: $1.25

Super low, low, low generics: $1.05

"Times are really tight," said George Dugan, an unemployed actor from North Hollywood who had just bought a pack of Best Buy Menthols for $1.25. "Some of these taste a little funky, but it's all the same to me."

The move to generic cigarettes has been building for about a decade, according to retailers around the region.

Jeff Appel, owner of United Oil Co., said that when the new smokes first appeared they were little more than curiosities in plain white wrappers. But especially in the past three years, sales have skyrocketed.

Now, he figures that a little less than half of his 3,000-carton-a-day total is generic cigarettes. "Little by little, they've eaten up the market," he said.

Tough times and the increasing spread between the price of premium cigarettes and generics have played a major role in boosting the popularity of obscure brands such as GPC and Misty.

But their rise is also a part of the changing demographics of smoking, Appel said. "Today it's the working people on budgets who are smoking," he said. "They're smoking for the nicotine."

Appel, a nonsmoker, added: "People are also smoking less, they're quitting, they're cutting back, they're dying . . . so you lose those people."

He said he sells almost no generics in Beverly Hills. But take a look at two of his best outlets: one is in Echo Park, the other in North Hollywood.

By most accounts, the prices at Appel's outlets are just about rock bottom. The $1.05 benchmark is even more amazing considering that 59 cents of the purchase price are state and federal taxes.

Take out Appel's 14-cent-a-pack profit and the wholesaler's 2-cents profit and you are left with a pack of cigarettes that costs less than 30 cents to produce.

Dugan, the unemployed North Hollywood actor, said he wondered at first: What were these cigarettes made of?

"I thought there was a catch," he said. "But it's the same tobacco."

Dugan said he started smoking generics about six months ago after running into tough times.

He briefly returned to Marlboros when a date asked him: "Why are you smoking those cheap cigarettes?"

After a while, he decided to go back to the generics.

"We're still dating," he said. "I just don't have to impress her anymore."

Despite the obvious price advantage, shifting to generics can be a tough decision for some people.

Haviv Levy, who started smoking while serving in the Israeli army during the 1973 Arab-Israeli war, said that because smoking is such a pointless and destructive vice anyway, what is the point in being cheap?

"At $5 a pack, I would still smoke Marlboros," he said. "I don't care how much it costs. My body needs it."

Carmine Naro of North Hollywood switched from Marlboros to a $1.25 brand after he lost a job as a choreographer five months ago.

He became a loyal generic user until, for some reason, he could not find his adopted brand anymore.

He quickly reverted to Marlboros.

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