We don’t spend enough time talking about cigars at BevX. Earlier this year I shared my experience in building and stocking a “Coolerdor” (converted an air-tight cooler into a cigar humidor).
In truth I haven’t offered regular cigar musings as I am an amateur cigar fan. I know just enough about cigars to be dangerous. I’m a beverage expert, not a cigar expert.
When I have cigar questions, I go to my friend and cigar guru, Phil Ledbetter, the manager at Up Down Cigars in Chicago. Phil is the most passionate and knowledgeable cigar expert I know. At times I find myself quizzing him and have an out-of-body experience as I recognize that I am on the other side of the conversation that I typically have when people pepper me with wine or spirits questions.
Bring on the Cubans
In regards to cigar news in 2015, the 800 pound gorilla in the room, is the potential return of Cuban cigars to the US market after a 50-year absence. Like many cigar fans, this news has me curious so I did what I do when I have cigar questions – Ask Phil.
The best way for me to communicate cigar knowledge and stories to the BevX reader is for me to share my personal Q&As with Phil. I might even be able to convince Phil to share some stories of his own like his recent trip to Cuba touring cigar factories. Without further delay I will now share our first edition of Ask Phil the Cigar Guy.
1. With all of the cool new products that have arrived this year I’m guessing that the news of Cuban cigars returning to American shores has dominated the chatter. How are your customers reacting to the news?
We do have a lot of cool, new products arriving this year, but unfortunately none will be Cuban. The biggest misconception about Cuban cigars since President Obama announced his desire to normalize relations with Cuba is that the embargo has ended. While relations are dramatically improving with Cuba, the trade embargo is still in full effect thus we are still not able to carry their cigars. Congress is required to overturn the embargo, and when they will do that is anyone’s guess. There are bills sneaking around Congress presently to do just that, but as Congress and our president aren’t playing very well together who knows when we’ll see more change. There are also staunch anti-Castro Republicans in south Florida that are trying very hard to block the normalization with Cuba, for instance by trying to block funding for our new embassy there. Then there are issues of trademarks infringements, distribution, and litigation over land and property rights that are bound to come into play that Cuba will need to address. There are still many things that need to be address before the embargo ends and trade normalizes.
As it stands, if you legally travel to Cuba with a State Department visa, you’re allowed to bring back $100.00 worth of tobacco OR alcohol products. Otherwise Cuban cigars, even bought in international duty-free stores, are technically illegal to bring into the US.
As far as customers reaction, just the rumors and open political discussion going on has renewed a lot of peoples’ interest in cigars in general so it’s already benefiting business. We get asked about Cuba literally every day, multiple times a day. It’s going to take a lot of time to inform and educate people on Cuba and cigars in general but that’s part of the fun of the job.
2. How will the return of Cuban cigars impact your business?
It should be great for business but also a hot mess. People always want what they can’t have, so the lust, hype and allure of Cuban cigars is stronger than ever. So in the short term, when they hit the shelves, they’ll be sold almost instantly.
The long term benefits for us are: it gets people thinking about cigars and brings back former clients and creates new ones, adds more variety to our humidor, opens an entire new type of tobacco to blend other cigars with. But this is going to change the entire global cigar industry. Allowing the biggest cigar consuming country on earth to suddenly have access to the most famous cigars on earth after over 50 years of prohibition will cause a lot of change to the industry internationally and only time will tell how fast and dramatic this will be.
3. Will this impact overall prices of cigars from nations other than Cuba? Are they working hard to keep their market share?
I honestly don’t think so. The companies and brands presently supplying the US are in competition with each other every day. Price matters already, and they run their margins lean to stay competitive. I don’t think the majority of our presently suppliers will change very much. I think the prices of Cuban cigars will go up dramatically, as Cuba doesn’t have enough tobacco or production capacity to supply the U.S. market. The U.S. is the largest cigar consuming country in the world so it’s not a simple process accounting for that when dealing with agriculture and handmade products that take skill to make.
Additionally, Cuban cigar production is very inefficient and inconsistent. All Cuban brands are owned by the government, so there is no competition between them and no incentive under communism to. I visited two factories in Havana this past May and they were terribly inefficient and unorganized compared to factories in the Dominican Republic, Nicaragua, Honduras and the U.S. Capitalism breeds competition, so to survive in this market you have to have a quality and consistent cigar. I think our current suppliers know this and while their sales will take an initial hit, they’ll rebound fairly soon. Plus, if they are allowed to purchase Cuban tobacco and blend it with their tobaccos and make them outside of Cuba, they’ll have their own, and possibly better, versions of Cuban cigars even though they won’t be made in Cuba.
If you want to start your own conversation with Phil you can find him at:
Up Down Cigar
1550 N Wells St, Chicago, IL 60610