Last Pulling Back the Curtain post I discussed how I decide what to bring in. Much like how there are many cigars I want to bring in but can’t or haven’t yet, there are several brands that I want to keep but I don’t. For me, this is a harder decision than not bringing something in initially. For one, I bring in cigars that I like. I hate to stop carrying a cigar that I enjoy. Furthermore, typically when I work with a company on bringing in their cigars, I forge some kind of relationship with the rep or brand owner. At times, I struggle to separate the business from the relationship.
So what causes me to stop carrying a brand?
I am going to get specific with examples for this post.
In general, when I am considering no longer carrying a brand I take into consideration how well the product moves as a whole and how well it moves relative to other brands in the company’s portfolio, how well the company “carries” themselves, and the distribution of the brand.
How well a product moves as a whole is an obviously critical component. How well a product moves relative to other products from the same company is a bit more of a subtlety. Two companies that come to mind for me are Casa Cuevas and Stolen Throne. Once upon a time I carried Casa Cuevas Cigars. I brought the brand in because, after smoking through 5 blends that they sent me, I was very impressed with the quality and smoking experiences of the cigars, as well as the uniqueness of the multi-national blends. It took me quite awhile to get through the small, 6 box order I placed with them.
Now, granted, that was at a time when I had far fewer visitors to the site, however, I had far fewer choices as well, and it seemed that Casa Cuevas was consistently getting neglected. There are a couple reasons that I attribute that to. First, although the Cuevas family has a long history in tobacco, they are still a small brand. I do not see them mentioned very often at all in the casual smoker or cigar nerd space. I was hoping that I could generate some appeal using that fact, as most of my customers are “cigar nerds” and that cohort often enjoys “discovering” those fantastic, small brands. However, I missed a very key point. Cigar nerds are pretty intune with things like tobacco types, factories, etc. They also stigmatize certain brands that are historically “dog rockets”. Unfortunately, there is some overlap between one of these famed “dog rocket” producing brands and Casa Cuevas’ Tabacalera Las Lavas Factory… As much as I personally enjoyed, and still enjoy the products, after having a couple customers mention their reluctance to purchase them because of that overlap, I made the decision to, for the time being anyways, not restock.
With regards to how a product moves relative to other products in the same company portfolio, I look at Stolen Throne Cigars as an example. Now Stolen Throne is a boutique company that receives high praises and attention within my primary cohort. All four of their core line blends are very good and seem to be well received, however, I only carry two - Crook of the Crown and Yorktown Fleet. Interestingly enough, my two favorite blends of theirs are the two I don’t carry - Call to Arms and 3 Kingdoms. So why only carry half the line? Why not carry my two favorites if I only carry two? This is a situation where, while all four blends have proven to, for the most part, move fairly well on my site, relative to one another, the Call to Arms and the 3 Kingdoms don’t quite move the needle. This is no knock on those blends - again, they’re my favorites. I just have limited resources and fans of Stolen Throne Cigars, and most of my customers, have, at this time, shown me the best place to allocate those resources.
Now, moving onto the next consideration, how well the company “carries” themselves. By this I mean how they market themselves and how they, and their reps, present themselves on social media, phone calls, press releases, etc. This also is a consideration for when I bring in a new brand - the same things apply. The cigar industry is full of big personalities and, unfortunately, ego. I am not going to give examples on this one because I don’t want to cause a stir. However, I have stopped carrying some things due to the product not actually fitting the marketing (i.e. “luxury brands” with subpar blends), brand owners entering agreements with other industry people that I would not want to do business with (i.e. distribution agreements), and brand owners and/or sales reps having poor communication (i.e. not providing information after multiple requests). Enough said.
Finally, distribution plays a big role in how I manage my inventory. It has kept some products on my shelves that may otherwise not be. A perfect example is perhaps my personal favorite company - Patina Cigars. I LOVE Patina Cigars. Mo is an amazing person, the cigars are always fantastic and unique, and I smoke a lot of Patina cigars. Unfortunately, they are not big movers for me - the brand is still young, and I hope they blow up soon enough. That being said, their distribution really benefits an operation like mine where small orders are the most common occurrence. Unfortunately, with most distribution operations, small orders mean despicable shipping costs that destroy margin. Patina makes it super easy and affordable to order whatever I need, no matter if it's 1 box or 20 boxes. I love it and am thankful for it.
As for some other brands, the distribution can make it hard for me to consistently support the brands. This is why you see sporadic additions to the site from companies like Foundation or Dunbarton Tobacco & Trust. These are companies that, for their own very good reasons, have stipulations that make it restrictive for shops like The Cigar Farm to order directly. As a result, I don’t always have a constant stream of inventory. I do not have any hard feelings there, as these are clearly and directly stated requirements. Each business has to do what works best for them.
Another thing that kind of goes with distribution is production and competition. There are some brands (again, I don’t want to be specific here as I don’t want to cause problems) that simply overproduce. They have a pretty extensive core line of offerings and release several “Limited Edition” cigars every year. To top it off, they overproduce those “Limited” products. What I have found is that the core line products do not move, at all, unless marked down substantially. In which case you have to move a high volume to make any non-negligible profit on. Furthermore, they release so many “Limiteds” that it is hard to keep up with. Before you sell all of one “Limited”, the consumer is already onto the next one. To top it all off, there production numbers on all their cigars are high enough that certain retailers are able to load up on enough product (whether from the company directly, or by other means) to offer them FAR below “MAP” (minimum advertised price), but at high enough volume that they can still turn a profit on micro–margins AND practically monopolize the market on that brand.
That last paragraph was more of a rant, but an important point to make.
Anyhow, I hope this post has provided some more insight into how I manage my inventory so you can better understand The Cigar Farm.
I think my next post will be more about some of my observations of the market.
Till next time,
-Trevor