General Cigars have been releasing new products every three months, and right now, the newest one off their shelves is the Macanudo Inspirado. Premium Cigar Sales Manager Sean Hardiman shares that it is a blend of Honduran Dominican and Nicaraguan that is an exclusive medium bodied smoke for cigar aficionados. The CAO is another product from General Cigars that’s been doing well in sales kicking back and forth from the warehouses. Since the company is releasing a different blend from the ones sold online to the ones bought in brick and mortar stores, it offers an exclusive experience for its patrons.
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Cigar Cafe Radio Sean Hardiman | Macanudo Inspirado | CAO | General Cigar
I’m Lane and I’m hanging out at Cigars & More in Birmingham. Sean is back with us after his trip to the beach and conference and hanging out with Harris. What’s going on guys? We have a special guest with us, Sean Hardiman from General Cigar. Welcome, Sean. Thanks for joining us.
Thank you. Glad to be a part of it.
I’m excited about having you. You’ve got some brands that we haven’t talked about in awhile, so I’m super excited. I smoked a hell lot of cigars during my time away both in Alabama at the Hillbilly Riviera and in Philadelphia, so I’ve got quite a few to talk about, but we’re glad you’re here.
Thank you. I’m glad to be on.
Sean, tell us a little bit about what you do at General Cigar. What’s your position with them?
I’m what they call PSM for short, a Premium Cigars Sales Manager. I travel around and get to see great people in the four states that I travel between and sell cigars, do events, all sorts of fun stuff. I’m also a little bit involved in some of the other stuff that our company does. Seminar‑based learning experiences, I’m involved in some of that. Also try to do a little bit of market research while I’m out on the road as well. I have a couple extra hats in there and the ring other than just being a sales manager, so it’s good. I love working for them. We’re a company that’s on the forefront of everything that’s going on in the industry. It’s always neat to see the new releases and some of the products that we come out with every three months roughly.
You come up with a new product pretty much every three months?
It seems like that. I don’t know if it follows a certain timeline or not, but we’re definitely pretty aggressive with the new releases. We’re good about taking the stuff that doesn’t sell off the market or the stuff that’s old that hasn’t been doing as well off the market. When we launch something new, typically something else goes away. We do that so that we don’t try and flood the market with too many products. We do a good job of that. We’re constantly trying to launch new products. What’s great now is launching a lot of new brick-and-mortar only exclusives, so a lot of the new products that we’re going to be talking about or that you’re going to hear about are ones that you’ll only be able to get from your brick-and-mortar retailers.
No online sales for the stuff that you’re talking about?
If there is, it’s going to be a separate cigar. The Macanudo Inspirado is a new launch that we came out with. That’s a blend of Honduran, Dominican and Nicaragua tobaccos. A great cigar, medium bodied smoke. That’s something that’ll be launching at the end of the month. This is almost like an exclusive because Cigar Aficionado hasn’t been able to review the cigar yet, so you are one of the first to hear about it. In this cigar, we’re going to have the orange label version, which is going to be brick-and-mortar only. Then we’re going to have a black label version of it that will be online only. We’re separating the two cigars, and we’re giving the brick and mortar retailers an opportunity to have something that’s exclusive for them.
Is it the same cigar with different blends on it or is it two different cigars?
Totally different blends. The black label’s going to have a little bit more Dominican tobacco in it. It’s going to have some La Aurora tobacco filled from the Dominican Republic. It’s going to have a Nicaraguan wrapper leaf versus the Inspirado that I’m smoking, which is orange label that has Honduran wrapper leaf from the outside. It’s our launch show wrapper. It’s proprietary, so it’s something special that we roll out.
It is just our company that manufactures that wrapper and I love the wrapper leaf. It reminds me a lot of Ecuadorian Sumatra in flavor. It’s very clean on the palate. It’s a phenomenal wrapper leaf. If you go through a lot of the ratings that that wrapper leaf has received from our company the CAO OSA, which was a great seller for us, we got phenomenal ratings using that same wrapper leaf. The blend that we have inside of this cigar really showcases that wrapper leaf. It’s a phenomenal product. This Macanudo Inspirado, I probably smoked twelve of them in the last two days. It’s really good.
I feel like the Dominican La Aurora tobacco has hit a recent stride in the last six months or so. The first half of 2015, there was a lot of Brazilian tobacco. The Dominican La Aurora is something that we’ve talked about on a couple episodes lately with different cigars that are including it in their blends.
The good thing about La Aurora is it’s an interesting tobacco overall. There’re very few companies that manufacture it. It ages extremely well, and you can age, lower priming, higher primings, they all each equally as well. What I love is Piloto. Piloto is something that my previous employer generally uses. What it is so clean on the palate. It’s great to use with Nicaraguan tobacco’s which have a heavy cream component and are a little bit dryer on the palate. That’s the same story with Honduran tobaccos, which tend to be a little bit dryer on the palate and have a heavy cream component to them. When you match that up with Piloto, the Piloto cleans the cigar up in a sense that makes the cigar a little bit savorier, almost adds a little bit of salt component to the cigar and I find that interesting.
I like when you pair Honduran tobacco or Nicaraguan tobacco with Dominican Piloto. It gives that cigar that cleanliness on the palate that you look for when you wake up in the morning after smoking a couple of them. You don’t wake up feeling like your mouth was in a blast furnace the night before. It’s a great feeling to smoke Piloto and I’m lucky where I’ve been able to smoke 100% pure form versions of Piloto. It is a phenomenal tobacco. It’s something that I feel is underutilized in our industry and it’s going to be something that you’re going to see more companies showcasing Piloto, whether it’d be binder leaf or filler tobacco. It’s very difficult to grow as wrapper leaf, so you’re not going to see Piloto wrapper out there, but you’re going to see it used more and more as binder and filler tobaccos in a lot of cigars. A lot of cigars use it, but a lot of cigars don’t market it. You’re going to see a lot of cigar companies marketing Piloto finally.
Is that the cigar you’re most interested in as far as launch goes? How’s the Flathead selling after it was in Cigar Aficionado?
It’s tough for General Cigar Company to have back orders because the fact that we have a warehouse in Virginia where I’m lucky enough to have walked through it and check it out that has 16 million cigars at any given time. For us to have a cigar that kicks back and forth on back order will show you that it is selling extremely well. The Flathead has been kicking on and off a back order, so that shows that it’s selling extremely well nationwide and it is selling extremely well in my territory. The Flathead has been doing extremely well.
That’s #3 Cigar of the Year?
Yes, #3 Cigar of the Year with 95 rating. It was ironic because the day that that news came out was the day I was interviewing for General Cigar Company.
You guys can probably tell Sean is one of the most knowledgeable people in the cigar industry. We appreciate that about you that you try to be an expert on everything you do.
My dad is great when it comes to business and he always taught me, he said “If you do something, you need to jump in head first to make sure that you understand everything that you’re doing and if you don’t, then you need to make sure that you’re at least learning as much as you possibly can to become an expert so that people want to listen to you when you talk.”
90% education and 10% entertainment.
I would say it’s probably 50/50, to be honest with you.
Other than those, what are you smoking now? What are the ones that turn your crank?
The CAO line. They let Rick Rodriguez, he’s the Master Blender of CAO, to take the reigns on the CAO line a couple years ago. I don’t know if it’s my palate agreeing with Rick’s or if Rick is as good as it seems. Every blend that he’s come out with has been a winner. The CAO Pilon is a cigar that I’d find myself gravitating towards frequently. I smoke probably one of those a day and it’s a phenomenal medium-bodied smoke with a ton of flavor. It’s got this dark Ecuadorian Habano wrapper leaf on the outside.
If you know Ecuador, it’s shade grown essentially everything. Even if you sun-grow in Ecuador, the natural cloud cover will block at least 50% of the sun’s solar radiation, so it’s like your shade-growing it. It’s very difficult to get a super dark wrapper that is shade grown without fermenting the tobacco for extended amounts of times, so if you look at the Pilon, it has a very dark, almost Maduro-looking Ecuadorian Habano wrapper leaf on the outside. It shows you that we’ve done the right thing when it comes down to the fermentation on that cigar.
Then you look at the internal blend inside being Nicaraguan tobacco, it’s another cigar that does that fine balancing act of having Nicaraguan tobacco in the core, but also being very well balanced and not being too dry on your palate and it delivers a ton of flavor. It’s a solid cigar. Same thing with the new Steel Horse, which is a line extension for the Flathead. That’s another cigar I smoke quite frequently and I’ve been enjoying. Everything Rick’s come out with has been a hit with me and has been doing well overall.
I received my very first Cohiba Red Dot, so I am going to pop my Cohiba Red Dot cherry. I’m going to sit down back and have it after I wash the cars. I’m excited about it and I’m going to pick up a Cohiba Cuban Siglo from Ken, so I’ll probably enjoy that too.
As a guy that’s going to be representing Cuban cigars possibly in the future, I hope that their cultivation practices get better.
I’ve had a few of them now. The owner of my company went to Havana for nine days and stayed at one of the very finest hotels and a Cohiba store was inside the hotel. He brought back some Siglos, he brought back Montecristo No. 2. He brought back the Maduro 5, and the taste was amazing. It was the production that was off. I’m so not used to imperfect cigars. Being from the United States, our production values are so good that a couple of cigars looked pretty funky.
There’s a simple way to explain that. You have 200 plus companies vying for the United States market, so the competition is fierce in the United States market. What that means is that if you don’t make a good cigar construction-wise, tobacco-wise, you’re right out of the gate. You’re not going to be successful by any stretch of the imagination, so you have to create good blends with very good construction in the domestic side of our industry in order to be competitive. Then when you look at Cuba, Cuba Habanos, they say, owns the whole entire shebang and the Cuban government gets 49% of the cut on all the cigars, so what ends up happening is there’s a lack of competition in Cuba.
What’s good though on the positive side is if the embargo gets lifted, it will be the fact that all of a sudden Cuban cigars, which are going to be much more expensive than the domestic cigars, they’re going to have to clean up their act and they’re going to have to make sure that the construction is better on their cigars or they’re not going to be able to compete. That’s a huge positive moving forward due to the fact that if they have to compete in the domestic market, they’re going to have to ramp things up.
The quality of the tobacco was going to have to get better and same thing with the construction. Simple fact is a company that I know of shipped ten Cohiba Behike’s, which is the highest in Cohiba on the market. Good smokes. The best tobacco that is available in Cuba put inside the Behike’s. We put them through quality control, we debanded them and put them through our company’s quality control at the time and only five out of those ten cigars passed our quality control.
The Behike was not my favorite Cuban that I had. The Sidwell Siglo was probably my favorite. I thought it was a beautiful smoke. That was the first one that I had. I thought it was going to be super harsh, super-strong. Apparently, the Cuban cigars I had before were from the backdoor entrance. It was beautiful. It was wonderful. The Behike was good, but it wasn’t great. I don’t know if that was me not liking that blend or me not liking the construction, but they certainly tasted great. You compare it to a domestic Cohiba or domestic pretty much anything that’s $5 or higher, and the domestic cigars would smoke it. If you put them next to one another, you wouldn’t want to smoke the Cuban.
How much do some of that competition do you think boils down to product and name recognition? You were saying in the U.S. market where there is much competition as there is, other than visually looking at a cigar construction, one of those things that you can get a first impression on, when you pick something up off of the shelf at a local brick-and-mortar shop and some of these Cuban blends that have been out for decades don’t need that for their first impression.
The thing is mostly the people that are picking up Cuban cigars internationally are going to be people traveling internationally, you get a lot of that. I’m not saying there’s a lack of great retailers. That’s a stretch because you have your Hajenius of the world in Amsterdam. You have some really good tobacco businesses that are overseas, but most of the time a lot of people are picking up their cigars on cruises or all these other things, half the stuff they’re getting is fake.
I ran a stat where it was saying 90% were counterfeit.
A lot of that tobacco comes from Mexico. It’s not even Dominican tobacco, which is what you’ll hear a lot of people say in shops. They will say, “Even though it was a fake, I’m sure it’s Dominican tobacco. I’m sure it’s good tobacco.” Mexican tobacco, not saying anything negative about Mexican tobacco because San Andres is one of the hottest wrapper leafs on the market, but there’s some nasty Mexican tobacco that’s out there. There’s some phenomenal Mexican tobacco that’s out there. Some of my favorite cigar features thick-based wrapper.
It’s not being used in counterfeit Cohibas. They’re using the bottom of the barrel probably.
They’re using scrap short fill what we call Cuban sandwich tobacco. That’s what they’re using.
I had the Mercedes Benz of smokes on my trip and some of them were pleasant surprises and some I didn’t love. I know we don’t talk much smack about it, but I had that Padron Family Reserve and to my palate, I didn’t love it.
When it comes down to those, everything is so subjective in our industry. I smoked Padron’s infrequently, but I do enjoy Padron a lot. I just for some reason never grabbed one or gravitate towards them, but we all know they are quality product. We all know that they’re made insanely well. The craftsmanship that goes behind the Padron is great, but what it comes down to if you’re a fan of spice and you’re a fan of full-bodied cigars, you’re probably not going to be a fan of Padron. You’ll probably gravitate more towards Dominican cigars, Dominican blends, or Nicaraguan blends that are showcasing more of that full bodied flavor profile that have a little bit of a interesting salt element to it and that would explain too as well if you like Cuban cigars or if you liked the flavor of Cuban cigars, that means that you have a salt-driven palate.
For some reason, I don’t know what they do in Cuba, but the Cuban cigars have this heavy salt element to them and it’s something you’ll taste also in a lot of Dominican cigars as well is the salt element. If you like salt in your cigars or subconsciously like salt in cigars, that would explain why you wouldn’t enjoy a Padron. Maybe it doesn’t fit that flavor profile that you’re looking for. The best part of our industry is there’s not one cigar for everybody and there never will be.
People have so many different things that they’re looking for out of their cigars and looking for out of their smoking experience, so that’s what makes our industry so unique. The only one that you can draw a comparison to is the wine industry where there’re certain wines that aren’t for you and then there’s certain wines that are. It’s the same thing in the cigar world, and that’s what makes our industry great.
I wanted some of the very best cigars I could smoke. I had a Padron Family Reserve. I had My Father LE 2015. I had the Davidoff Year of the Monkey. I had Liga Privada T52. I had the full range of them, and I came up with this. When you start getting into the $25 to $30 range, I have yet to find a cigar, not one cigar that is in that range that I’ve been like, “I can’t believe that I’m smoking, like this is bomb.” I’m never super impressed with it. Maybe I just haven’t found the right one. Maybe I’m going into it subconsciously thinking this is going to be great. I have not found one yet.
I’ve talked several times about how I can pick a great stick. I have picked much of my favorite sticks, the $8 mark and the $12 mark. Once you start getting into the Liga Privada brushing up on $20 and Opus X. Somewhere between $20 and $25, there is the law of diminishing returns gets you. You may get a fine cigar, you may get a perfectly enjoyable cigar, but is it that much more enjoyable than one of those cigars that you can pick in the sub $10 in the sub $15 and in the $20-ish range. Is it twice as good? Is it five times as good? You can’t find $100 cigar unless you want to set $100 bills on fire.
Sean, do you find that to be the case too? I know that your company’s price point is very much in that $8 to $15 range, that seems to be the sweet spot.
At the end of the day, we’re smoking tobacco. The tobacco that’s in a $4 cigar versus an $8 cigar, there could be a huge difference between the tobacco in those price ranges. When you look at the difference between the tobacco that’s in an $8 cigar versus the tobacco that’s in a $30 cigar, typically speaking, it’s aged. Either that or they’re using a very rare tobacco or there’s a certain process that’s going on there that we don’t understand that costs extra money. There are so many processes in this industry that are labor-intensive that some companies do that other companies deem as not being necessary, but that company that does that process deems it to be 100% necessary and it adds cost to the cigar.
Even when you’re talking about arranging the tobaccos during the bunching process right before you’re putting that binder leaf on the filler tobacco, there’s three different ways to do that and I’m sure there’s more ways to do it. There’s three that I know of. When you buy a $4 cigar, we call it booking. That’ll be the way that the tobacco is arranged in the bunching process. When you’re buying something that’s $8 and above, they can do an accordion style bunching, which is the most labor intensive or they can do an Entubar style bunching, which is also very labor intensive, but not as labor intensive as the accordion style.
You have these different styles of bunching and companies can create cost structures based off of how they’re going to arrange the filler tobaccos and the bunching process. Some cigars that you smoke, you’re going to notice that the draw is wide open and typically speaking, those are going to be the Entubar or that accordion style bunching. People don’t realize that. There’s all different ways that costs can be increased, but at the end of the day we are smoking tobacco, so tobacco is, you could use more ligero, which is more expensive. You can use La Aurora that’s been aged for fifteen years and because of that, you’re losing yield over time.
Every time you rotate those Pilons, that the tobacco has been aging and your losing yield, so due to that the labor cost goes up because you’re constantly having to rotate the tobaccos, so labor goes up. Then you’re also talking about the fact that you’re losing tobacco during this process, so the cost goes up on that end. There’s always a rhyme and a reason why this cigar is expensive. I hear all the time, “It’s marketing, it’s marketing, it’s marketing.” Marketing is factored into the cost for sure, no doubt about it, but it’s not factored in the cost as much as the actual production and the cost of the tobacco that is being used.
The other thing you’re going to see is you’re going to see Connecticut wrapper leaf go up because labor rates are going to be increasing, so you’re going to see some of this stuff. Gone are the days of Connecticut broadleaf cigars or Connecticut Habano or Connecticut shade-grown wrapper leaves. Gone are the days that you’re going to be able to get those cigars for under $10. That’s going to be very rare to be able to get Connecticut tobacco in a cigar or Connecticut wrapper leaf on a cigar that retails for less than $10. You’re not going to see it anymore, so the guys that enjoy that tobacco, they’re going to have to shell out that $15 to $20.
I’m glad you brought that up, the price point for a lot of General Cigars, because Harris and I, we don’t usually smoke the same cigar on the show, but we both grabbed the same one. We both grabbed the Punch Signature and it was a little over $7, so a great price point for a cigar. It’s full-bodied, has an Ecuadorian Corojo Provo wrappers, or a form of that. It’s Honduran. Why don’t you tell us about it, Sean?
The Punch Signature is an interesting cigar overall. When you smoke, it depends on what size you’re smoking. If you’re smoking the Rothschild or you’re smoking the Robusto, it is pretty intense. It’s a pretty stout cigar, then you’re smoking the Gigante, it’s more that medium, medium plus realm. It’s a cigar that’s doing extremely well for us. It tripled our sales expectations, so that’s always good when you hear that, but the cigar is phenomenal.
Punch Signatures is another one that’s heavy in my rotation. It’s a cigar I smoke all the time. It’s something that is a departure from the Punch line, your Punch EMS, your Punch Maduro, your core line Punch cigars are going to be in that medium-bodied realm, very flavorful, easier going sticks. They’ll have some spice to it, but then you get into this Punch Signature and it’s going to be in that medium to full bodied realm. It’s going to sock you a little bit. It’s got some heat. It’s an interesting cigar. It’s definitely a departure from what we do with the core Punch line.
It does have some fairly prominent spice to it, but I’m still getting some of those traditional flavors, the leather, the cedar, maybe a little bit of cinnamon, and some non-pepper spice in there, but no, I’m definitely enjoying this stick.
It’s a great smoke. It’s an interesting cigar overall. It’s something that almost anyone can smoke and if you’re a medium-bodied cigar smoker, you’re going to enjoy it. If you’re a mild cigar smoker, if you smoke at one of the heavier ring gauges, you’ll enjoy this cigar. It’s something that we tried to put out there that was an everyday cigar, something that people could feel good about picking up. It’s under that $10 price point, which is great. That’s where we try and operate mostly, under $10. We feel that $10 price point is a watermark in our industry. People like to stick underneath that $10 realm and what’s great about General too is you take the new Hoyo and you’d take the new Macanudo Inspirado. You look at the tobaccos that are inside of that cigar, these cigars should be retailing for over $10 and they’re all going to retail in Alabama around $8.
You look at the blend that’s inside there, you look at the tobaccos that are being used, you’re going to be hard pressed to find any other company in our industry that can sell these cigars for around that $8 mark. It speaks to General’s one, their buying power, and then two, the fact that they are a vertically integrated company. When we’re talking about the cost of a cigar, when you’re vertically integrated, you can make a quality product and sell it for cheaper than the companies that aren’t vertically integrated because the companies that aren’t vertically integrated, profit needs to be made twice.
When you are a vertically integrated company like General, profit only needs to be made one time. Because of that we’re able to launch some cigars, like the Punch Signature, liked the new Hoyo, like the Macanudo Inspirado at these $8 price points. When other companies, if they were to make the same exact blend, would have to sell them at $11 or $12. It gives us a significant leg up and it’s great working for General due to that. I can go to people and say, “This regard should retail for $11, but I’m putting it in your hands and you’re going to buy it for $8.”
That’s a great point. Not to name names, but I know you guys make cigars for a lot of other companies in the industry that are over $10 that may be similar to some of these blends.
What makes me laugh about it is the fact that you get your guys that only smoke what they consider to be boutique cigars. I hear it all the time, “I don’t mess with General. All I do is smoke this brand, this brand. This boot-sticking cigars.” What they don’t realize is they’re smoking two or three General products a week even though they’re saying that they’re a boutique cigar smokers and all they smoke is boutique. They’re smoking General products. They just don’t realize it.
What are your top five General Cigars regardless of the brand? If someone wanted to get a true taste of General Cigar and what they can do, what would be your top five?
It all depends on what they like, mild, medium or full, so I’ll probably do a little breakdown here. On the mild side of things, the CAO Colombia is the cigar I find myself gravitating towards all the time in that mild realm. It’s a unique blend. It showcases the filler tobacco, so it’s got a neutral wrapper leaf, it’s got a neutral binder, it’s something we call in the industry as a cigar that’s blend-dominant, so it showcases the Colombian tobacco, which is very sweet. It is natural sweetness, there’s no artificial; there’s no nothing in there.
That cigar is fantastic first thing in the morning. For the mild cigar smokers out there, I am telling you to try the CAO Colombia. For sure, when you look at that medium-bodied realm, I love Cameroon wrapper leaf. I adore it. It’s one of the best wrapper leaves in the world. Our core Partagas line, I find myself smoking quite a bit. Then when you get up into that medium to full-bodied realm, the Punch Signature is a great cigar.
The new Hoyo is a great smoke. Hoyo Black Label, you could call it Hoyo Black Box. I’ve heard a million different ways to characterize that, but it’s just called the new Hoyo. Then you have also the Flathead line from CAO, which is outstanding. You have the Pilon from CAO, which is outstanding. There’s quite a few cigars that we’re making that are new to us that our cigars that I keep gravitating towards. Those would be the ones that I highlight and talk about quite frequently.
I feel like we spent a whole lot of time talking about the tobacco, about the cigars. How did you get into the cigar world?
I started playing golf when I turned 21, and one of our good family friends who’s since passed away, Eddie, was a huge cigar smoker. I’d just go out there, I’d play golf with Eddie and I’d light up a cigar and next thing you know, I’m managing Cigar Masters in Providence, Rhode Island. Four years into that, La Flor Dominicana came knocking. I worked for La Flor Dominicana for two and a half years and then General Cigar Company interviewed me and wanted me to work for them, so now I work for General. It’s funny how things worked out.
I never would have thought going through middle school or high school that I’d ever be in the cigar industry, and it’s the greatest industry in the world. I wouldn’t want to work in any other industry. I get to work with clowns like Harris all the time and I get to bust his chops on a daily basis if I want to, and there’s a lot of great guys in the industry. Harris is one of them. I’m lucky to work with Harris, do events with Harris, and he’s one of a ton of guys that are great in our industry. I feel like I don’t work. I feel like every day I wake up and I go hang out with my friends. It’s an industry that is unlike any other.
Taking pokes at Harris is all fun and good, but I hear some things from both of you. A lot of people get into the craft of cigars and it’s good to hear from the other side of the coin that there are people interested in the business of cigars and furthering that because if the business isn’t there, the craft dries up.
You have your dichotomy in the industry. You have your guys that own cigar shops because they’re passionate about cigars or they like our industry and they want to be a part of our industry. Then you have your guys that have the business, they approach it on a business side. You have both of those kinds of retail shop owners. What’s great is when you meet guys that are passionate about the industry and also have a very good business sense, that’s always great. Those are the guys that I gravitate towards or find myself gravitating towards.
I’ll give Harris a lot of credit. Harris has both sides of that. Every time I see Harris, he’s got a cigar in his mouth. He’s talking about it. Also on the business side, Harris is a very savvy businessman. There’s a lot of guys like that in our industry and there’s a lot of guys like that in the Southeast, and it’s great working with guys like that. They just get it. They understand our industry, and they also have passion for the products that we make. When you see that those are the guys you want to go to bat for. Those are the guys that you want to make sure their shops are successful.
What states do you handle, Sean?
My territory is very confusing. I have all of Georgia, the Florida Panhandle, Alabama, and Mississippi. Then I have just Chattanooga and just Memphis, Tennessee. It’s a little different. Logistically it makes all the sense in the world for travel, so that’s what makes it great, but it’s an interesting territory for sure.
Have you seen all the press about the language getting added to the Appropriations Bill to exempt premium cigars from FDA regulation?
It’s a huge step for us as an industry. What we needed to push for is for that premium cigars to be separate from OTP products. OTP stands for Other Tobacco Products, which means anything that’s not a cigarette. Premium cigars are something that’s vastly different from the other OTP products that are out there, like your Swisher Sweets. Even your pipe tobacco is a different animal altogether than premium cigars, so it’s great. I know the state of Georgia, we’ve been talking with state representative there and it looks like we’re going to be pushing towards language separating premium cigars from the OTP products in that state.
The more that we can get that to happen, the better off we are as an industry because believe it or not, the amount of tax money and revenue that’s created from our industry is nominal. It’s not a huge amount. Due to that, once they start realizing that, they’re going to start realizing that all they’re going to do is not raise that much tax money and crush small business the more that they heighten taxes on our industry. This is a huge step forward for us for sure. We hope that moving forward, they can take the focus off the premium cigar industry, take the focus off the other OTP products out there because that also benefits a lot of our retailers. We’re making huge steps as an industry towards separating ourselves from the other OTP products, and also helping us out lowering taxes in a lot of states is the next step.
One of the big steps that CRA has made has been acknowledging the global economy and showing that these regulations aren’t going to hurt small American companies, they’re also going to hurt the economies of other countries if these regulations go into place completely unchecked.
Those governments from the Dominican Republic, Honduras and Nicaragua, they have started lobbying on that point that can hurt their economies and then other people bringing up the point that whenever Cuba does open up the predicate, they would exclude Cuban cigars from being sold in the U.S.
Sean, do you feel like being part of a traditional cigar company like General that the risks are different for you with these FDA regulations? Do you feel shared burden with those? How does that affect you?
Working for General, you’re not as concerned as you would if you’re working for a smaller company. Most of our tobacco products, most of our cigars, have been in place or have been mass marketed before 2007, which was the FDA’s cutoff date. Due to that you’re not as worried. When it comes down to my job personally, I’m not as worried, but on the other side of things, you do have to worry about the well-being and the health of your retailers and these are guys that you established relationships with.
These are guys that you feel like you’re going to war with everyday. The thing is that any legislation period, whether it be a new minute piece of legislation, that goes in that is as anti-cigar, it doesn’t help my retailers. Due to that, I try and stay involved in everything that’s going on. Harris would probably say that I’m probably one of the more involved guys that’s out there when it comes down to the legislative side of the cigar industry. The fact of the matter is that we all have to worry about changes in our industry.
We all have to try and make sure that things can operate or get better from where they are now and things can improve or stay where they’re at. It’s important that every sales rep approaches it that way and tries to make good decisions for their retailers daily. It’s a symbiotic relationship. Without retailers, General Cigar Company doesn’t exist. In a lot of ways, we would be exempt from a lot of the things that are going on but it wouldn’t be because it would hurt our retailers. That’s why we try and stay proactive as a company and I know that that’s why I try and stay proactive in trying to inform people on what’s going on legislatively speaking.
A lot of your stuff has been around, but you guys have so many new blends that would get wiped out by that too though. I had an interest in conference call with IPCPR and they were talking a little bit more about what this language means and the Ag Appropriations Bill that the congressman from Alabama, Congressmen Aderholt, put in there. We thank him for doing that, but basically, it’s an exemption for 2017. Even if it stays in there, we would have to get it exempted again next year. The IPCPR feels like it would be a good start, but it’s the beginning of trying to do all the things that Sean said.
The other thing too is we’re seeing this happen out of nowhere. The thing is we’ve been relatively under attack from the FDA and some of the other leanings of our government. The funny thing is that as soon as we start talking about lifting the embargo with Cuba, all of a sudden Obama is on a flight back from Cuba and he’s talking to the FDA and he’s talking to Senate subcommittees about exempting premium cigars from any further legislation. We have to look at it and say, “Cuba has been affecting this.”
It’s definitely a high priority with the current administration, so all of a sudden that might work in our favor unexpectedly.
We all have to root for Cuba. It’s the way things are going. If they were to put in the bill that exempts premium cigars pre-2007 that were mass marketed in the United States from any further FDA regulation, and then they were to open up the embargo, that opens up a whole can of worms. Because of the fact that none of those cigars from Cuba as part of the rule would have been able to be mass marketed in the United States pre-2007 because of the embargo. Due to that, those cigars would be non-exempt. Those cigars would fall under the category of cigars that need FDA approval. Due to that Cuban cigars, even if the embargo was lifted, it would be at least two years before Cuban cigars could reach retailers.
One of the things that we’ve talked about was some of the smaller boutique companies that is one of the things that they have been excited about with the prospect of the embargo is they’d be able to introduce a leaf of Cuban tobacco into their blends and shake things up. Is that something that General would also be interested in doing?
To be honest with you, I am not quite sure. The reasons behind that is first and foremost, the boutique companies that have been saying that, they’re dead on. It would be an interesting time if you could add Cuban tobacco to you cigars and try blending cigars with a Cuban filler or Cuban binder. Because they run into problems growing rapidly from Cuba, so you’re not going to see Cuban wrapper leaf to hit the market anytime soon other than on Cuban bureaus. The fact of the matter is there’s going to be such a scarcity for Cuban tobacco and there’s going to be such a limit on the amount Cuban tobacco that’s going to be available because the demand is going to go through the roof.
Cuba has only been selling to 30% of the world market; 70% of our world market roughly is the domestic market. You’re going to be opening up Cuba to 100% of the cigar market when they’ve only been making enough product for 30%. They’re going to have a huge numbers crunch to go through. The cost of the cigars is probably going to be fairly high and the cost of the tobacco to purchase for a boutique company is going to be extremely high as well. I doubt that you’re going to see Cuban filler tobacco and binder tobacco be used in any boutique blends or in any blending process of any domestic product. You’re going to see Cuban cigars just be Cuban cigars, and that’s my personal take on it. That’s my opinion. That’s not a company take or anything like that. I’ve put a lot of thought behind this and that’s where things are going to go. I don’t think you’re going to see all of a sudden 80 different cigars coming out with Cuban tobacco inside of them. There’s no way possible that could happen.
A thing that might happen is you see a few limited editions here and there. They are very expensive, $30, $40 range or more.
I went to the Ashton Cigar Bar in Philadelphia when I was there for the conference and what a pleasant experience. I don’t know of any cigar bars around here, but how cool to be in a place that everyone is being social and smoking cigars. It was a lot of fun. They’re pumping in some great music and it’s definitely a pretty people place, so they let me in with some caution. They’re like, “You’re not the normal guy. You’re like a Chicago hillbilly,” but it was fun to go.
I’ve heard good things about that place. I’ve never been able to make it there, but then you take General again. Let me bring us up. We have the Club Macanudo in New York, which is a high-end cigar bar and I hear great things about that place as well. Just a unique atmosphere and I’ve heard the Ashton Cigar Bar is over the top, but really nice.
Sean used to be a big Java infused smoker and now he’s come full circle in a little over a year and smoking everything out there.
I’m going to the store to buy some of yours.
Thank you. Go for it. It’s how our industry works. I hate to say it. It’s going to sound screwed up, but Acid is like gateway cigar. There’re a lot of these flavored cigars. The CAO flavors, the Acid, the Tatiana’s, that most of the time people that get involved in smoking premium cigars start out on the flavored side of things. I know I did. The first cigar I ever smoked was La Gloria Cubana series but did not right after that because that thing ripped my face off. I was smoking flavored cigars, so you see that happen.
What happened was that I was smoking all the Java’s, a couple Acids. I’ve never been a huge fan of ACID. I was smoking a Java, so I had the Latte, the Maduro, I had the mint one in. A friend of mine, he has a small privately held pharmacy in Pennsylvania, and he is an Ashton distributor. He doesn’t sell many others than Ashton. He sent me the sampler pack with the VSG in it. I was going through them and I got to the VSG and I smoked the VSG and went, “Is this a great cigar?” I didn’t know that it was full flavored, full bodied. I wasn’t too sure about what that meant at the time, but as soon as I told Harris, he goes, “You had one hell of a cigar there. That’s it, It’s a pro cigar,” and I went “I like it if that’s the pro cigar. I like the pro model.”
I’ve seen more people who get tossed on Dream Street by smoking VSGs and they’re almost gone. You toss a VSG Wizard at someone that’s not used to smoking a strong cigar, I literally hope they left the steakhouse and ate a porterhouse because they’re going to be in a world of hurt.
Talking about the VSGs, I love the Enchantment, that little nubby Perfecto. That is a great little full‑bodied powerhouse.
You can’t go wrong with Ecuadorian Sumatra. I’m a huge fan of Ecuadorian Sumatra. Ecuadorian Sumatra wrapper leaf is one of my favorite wrapper leaves, always will be. VSG has as an Ecuadorian Sumatra on the outside, so I’m a huge fan of that cigar. It’s a great smoke. They’re more than once credited in Ashton with starting the trend towards more full-bodied cigars. You have the Opus X 20, the Ashton VSG. They were some of the first more full-bodied cigars out there.
If you look at LFD 2 coming onto the scene, Joya de Nicaragua coming onto the scene, they brought the full-bodied cigars to the masses for sure.
Let’s talk about completely different cigars. Give us three cigars that you love that are outside your line.
I’ve always been a huge LFD guy, so working for them was great. A huge Coronado fan. Coronado is probably one of my favorite cigars of all time and will be up there forever. Then outside of that cigar, let me think. VSG is another good one. VSGs are outstanding, love smoking VSGs, and I like a lot of the C.L.E. products. I smoke a lot of the C.L.E. products, and I smoke a lot of the Alec Bradley stuff. The new Post Embargo from Alec Bradley is awesome. That’s a great cigar. The C.L.E., any of the La Aurora line is outstanding.
We’re a big fan of La Aurora.
Did you say the Alec Bradley one just because your roommate is the Alec Bradley cigar rep?
No, the Post Embargo tastes like oatmeal cookies when I smoke it every time. I smoke that cigar in the morning and it’s a great smoke.
It was good having you on. I always love it when we have a pro guest on where we’re not talking just cigars and football and buffalo chicken wings. Lane, you want to take us out?
Sean, thanks for hanging out with us. We always like it when we get to have a guest because it’s like we get a day off. Thanks for spending your time with us.
No problem. Anytime, guys.
- General Cigar
- Macanudo Inspirado
- Cigar Aficionado
- La Aurora
- Steel Horse
- Cohiba Red Dot
- Cohiba Cuban Siglo
- Montecristo No. 2
- Maduro 5
- Padron Family Reserve
- My Father LE 2015
- Davidoff Year of the Monkey
- Liga Privada T52
- Opus X
- Punch Signature
- La Flor Dominicana
- Ashton Cigar Bar
- La Gloria Cubana
- Opus X 20
- Ashton VSG
- Joya de Nicaragua
- Alec Bradley
- Post Embargo