Strategies for a risky business: How drug dealers manage customers, suppliers and competitors in Italy, Slovenia and Germany.

BACKGROUND: A growing body of literature aims to improve understanding of the operations of drug trafficking markets through conducting interviews with dealers and traffickers. Insight into how these individuals conduct business can provide evidence to inform the efforts by policy makers, law enforcement and practitioners to disrupt illicit markets. This paper aims to make a contribution to this evidence base by extending the number of European countries in which interviews have been conducted with incarcerated drug dealers and traffickers. METHODS: It draws on interviews with 135 men convicted of offences related to the distribution or sale of heroin or cocaine and imprisoned in Italy, Slovenia and Germany. The research was conducted as part of the Reframing Addictions Project (ALICE-RAP) funded by the European Commission. The sample was diverse. It included a range of nationalities and some individuals who were members of organised crime groups. The majority of the interviewees were dealers who sold at the retail and street level, but there were some who were importers and wholesalers. FINDINGS: Most dealers in each of the three countries reported having more than one regular supplier, and were able to respond to periods of over and under supply without losing customers. Supply arrangements varied in terms of frequency and quantities bought. Dealers engaged in repeated transactions and their relationships with customers were based on trust and reputation. Dealers aimed to sell to regular customers and to provide drugs of good quality. While dealers sought to maximise their profits by cutting drugs with cutting agents, the quality of drugs that they sold could affect their reputation and thus their profits and position in the market. Lastly, while there are some significant differences in the approach between those involved in organised crime groups and those who are not, and between street dealers and those operating at higher levels of the market, there were striking similarities in terms of the day-to-day operational concerns and modes of relationship management. CONCLUSIONS: Interviewees' arrangements for securing supplies of drugs provide support to the notion that drug markets are resilient and flexible. Our findings correspond with other empirical research in relation to the centrality of trust in the practical operation of supply and sale of drugs. The research highlights some differences, but important similarities between dealers who were part of organised crime groups and those who were not; dealers all faced some common challenges and adopted some common responses to these.

Modeling the structure and operation of drug supply chains: The case of cocaine and heroin in Italy and Slovenia.

Multiple layers of dealers connect international drug traffickers to users. The fundamental activity of these dealers is buying from higher-level dealers and re-selling in smaller quantities at the next lower market level. Each instance of this can be viewed as completing a drug dealing "cycle". This paper introduces an approach for combining isolated accounts of such cycles into a coherent model of the structure, span, and profitability of the various layers of the domestic supply chain for illegal drugs. The approach is illustrated by synthesizing data from interviews with 116 incarcerated dealers to elucidate the structure and operation of distribution networks for cocaine and heroin in Italy and Slovenia. Inmates' descriptions of cycles in the Italian cocaine market suggest fairly orderly networks, with reasonably well-defined market levels. The Italian heroin market appears to have more "level-jumpers" who skip a market level by making a larger number of sales per cycle, with each sale being of a considerably smaller weight. Slovenian data are sparser, but broadly consistent. Incorporating prices allows calculation of how much of the revenue from retail sales is retained by dealers at each market level. In the Italian cocaine market, both retail sellers and the international supply chain outside of Italy each appear to receive about 30-40% of what users spend, with the remaining 30% going to higher-level dealers operating in Italy (roughly 10% to those at the multi-kilo level and 20% to lower level wholesale dealers). Factoring in cycle frequencies permits rough estimation of the number of organizations at each market level per billion euros in retail sales, and of annual net revenues for organizations at each level. These analyses provide an approach to gaining insight into the structure and operation of the supply chain for illegal drugs. They also illustrate the value of two new graphical tools for describing illicit drug supply chains and hint at possible biases in how respondents describe their drug dealing activities.