The Profit Pool
Has Moved.
OTP has passed cigarettes in gross profit contribution for the first time. Category Managers who act now will own the shelf. GPOX delivers the turnkey program to get there with DSD service, compliance review, and expert product mix across 9 states.
2025 NACS Backbar Scorecard
The Convenience Shelf
Is Changing Fast.
NACS data tells a clear story: OTP is growing while legacy categories are under pressure. For the first time in a decade, OTP has surpassed cigarettes in gross profit contribution. This is not a future trend. It has already happened.
Category Sales Growth — Per Store, Per Month (2025)
Gross Margin Comparison — Why OTP Wins the Shelf
A Decade of Shift: Cigarettes vs. OTP Share of Inside Sales
Source: NACS CSX Convenience Benchmarking Database. Cigarettes declined from 29.5% to 18.0% of inside sales; OTP grew from 5.5% to 9.4% over the same period.
Historic First: OTP Has Surpassed Cigarettes in Gross Profit Contribution.
For the first time in the ten-year NACS data set, OTP contributed more inside gross profit than cigarettes. The margin gap is real and it is widening. Retailers who still treat OTP as secondary are behind the profit curve.
Profit Share
Profit Share
Most Stores Have
Illegal Products
Right Now.
The FDA, DOJ, and 18 states are actively enforcing against unauthorized tobacco products. The question is not whether enforcement is coming. The question is whether your store is ready.
$2.4 Billion in Illegal Vape Sales in 2024
Unauthorized, flavored disposable vapes generated $2.4B in U.S. sales in 2024 alone, representing 35% of the entire tracked e-cigarette market. (Reuters / Circana, February 2025)
DOJ Seized 2M+ Illicit Products in One Action
A single September 2025 joint DOJ/FDA enforcement action resulted in the seizure of more than 2 million illicit vaping products from distributors and retailers nationwide.
22 Major C-Store Chains Received Senate Warning Letters
U.S. Senators sent formal warning letters to 22 top convenience store chains and wholesalers over the sale of illegal vape products, signaling escalating political pressure.
18 States Have Enacted Enforcement Policies
States including Louisiana, Kentucky, Utah, North Carolina, and Wisconsin have enacted FDA compliance directories. States with enforcement policies saw compliant pod segment growth after illicit products were removed.
Only 39 Vapes and 20 Nicotine Pouches Are Legally Authorized
The FDA has mailed compliance materials to 300,000+ retailers listing the only products legally authorized for sale. If your shelf carries anything outside this list, you are at risk.
What PMTA Means
For Your Store.
The Premarket Tobacco Product Application (PMTA) is the FDA's authorization pathway for all new tobacco and nicotine products. It is not optional, and most products on shelves today have not received it.
As a Category Manager, understanding PMTA status is now a core part of your job. Here is what you need to know:
Every New Tobacco Product Requires FDA Authorization
Any product introduced after February 15, 2007 must have an FDA marketing order before it can be legally sold. This includes virtually all e-cigarettes, vapes, nicotine pouches, and heated tobacco products.
The Authorized List Is Very Short
As of late 2025, only 39 e-cigarettes and 20 nicotine pouches have received FDA marketing authorization. The vast majority of products currently on convenience store shelves are not on this list.
Retailers Are Responsible for What They Sell
Selling unauthorized products exposes retailers to FDA warning letters, civil monetary penalties, and escalating enforcement actions, even if the products were supplied by a third party.
State and County Laws Add Another Layer
Beyond federal PMTA requirements, states and counties are enacting their own rules around age verification, product placement, flavor restrictions, and import compliance. Operating across multiple states requires deep regulatory awareness.
What Is at Stake If You Are Non-Compliant
FDA Warning Letters: Retailers receive formal notice of violations, creating a compliance record that increases the risk of escalated enforcement on subsequent inspections.
Civil Monetary Penalties: Fines can be assessed per violation, per day. For multi-location operators, exposure compounds rapidly.
Product Seizure and Injunctions: DOJ and FDA can seize inventory and seek court orders to stop distribution of unauthorized products.
Reputational Damage: Senate letters and public enforcement actions are increasingly covered in trade press and local media, creating brand risk for retail chains.
Lost Revenue from Forced Removal: Retailers who must suddenly remove non-compliant products face immediate revenue gaps with no replacement plan in place.
Your Cigarette Customer Is Already Your OTP Customer.
The adult tobacco and nicotine consumer base has remained relatively stable at approximately 55 million users. What has changed is what they buy. Cigarette smokers are now a smaller share of that base and they are actively purchasing across multiple product formats.
This is not a replacement story. It is a portfolio story. The right OTP program captures the full basket.
What Cigarette Consumers Also Buy
OTP Sub-Category Growth (2025)
Source: NACS State of the Industry 2026 / Reynolds Integrated Track
We Made the Early Mistakes
So You Don't Have To.
GPOX has spent three years operating in the field, servicing gas stations and convenience stores, learning which vendors take compliance seriously, and building a program that works at store level. Retailers don't need to become OTP experts. GPOX already is.
Serviced
Weekly DSD Routes
Footprint
and Counting
Compliance-First Approach
As a publicly traded company, GPOX enforces a rigid vendor onboarding process. We evaluate PMTA status and documentation rigorously and do not accept vague paperwork as proof. Your store's compliance posture is our responsibility too.
True DSD Service
Weekly Direct Store Delivery puts a knowledgeable GPOX rep in your store regularly, managing planogram compliance, reducing stockouts, and ensuring the right products are on the shelf at the right time. Not just a drop-ship box.
9-State Regulatory Expertise
Operating across 9 states means we understand both federal PMTA requirements and the patchwork of state and county laws, from Texas's ban on products from foreign adversary countries to state-level enforcement directories.
Data-Driven Product Mix
We use AI-enabled intake and store-level data to recommend the right portfolio for your market, balancing velocity, margin blend, compliance, and serviceability. No guessing. No random assortments.
Flexible Fulfillment
Stores in our DSD footprint receive weekly route service. Stores outside the primary service area can access drop-ship solutions. Either way, you get the program, not just the products.
Public Company Discipline
GPOX is a publicly traded company. That means higher standards for compliance, documentation, and accountability. We cannot afford a casual posture and neither can your stores.
Tell Us About Your Stores.
We'll Suggest Everything Else.
GPOX already has the products, vendor relationships, warehouses, compliance processes, and service model in place. Once we understand your store footprint and market, we move quickly — from assessment to active program in days, not months.
Free OTP Assessment
We review your store or chain profile, current OTP status, state and market considerations, and service model fit. No obligation. No sales pressure.
Product Mix Recommendation
We recommend a portfolio built around velocity, margin blend, compliance posture, and serviceability, tailored to your specific market and customer base.
Compliance Review
We work with vendors that take PMTA and documentation seriously. We review vendor qualification, product authorization status, and help identify any current shelf risks.
Inventory and Shelf Support
Products in hand, warehouse infrastructure, and shelf strategy support to reduce stockouts and ensure the right assortment is always available.
DSD or Drop Ship Delivery
Weekly DSD service in our active footprint. Drop-ship solutions for stores outside the primary service area. Flexible to fit your operation.
Ongoing Optimization
We continue learning from store-level data and adjust the program as the category evolves. The OTP landscape is changing fast and your program should too.
Let's Build Your
OTP Program.
Answer a few questions and GPOX will help determine the right program path for your store or chain. Free, fast, and no obligation.
Get My Free OTP Assessment
Tell us about your stores. We'll suggest everything else.