TRENDS AND TRENDSETTERS IN SPECIALTY TOBACCO RETAILING
Attorney Convicted of Smuggling Cuban Cigars
Chicago - Richard Connors, 53, a Chicago attorney, was convicted in October of smuggling thousands of Cuban cigars into the country in violation of the government's 39-year-old trade ban with Cuba. He faces as much as five years in prison at sentencing, scheduled by U.S. District Judge Ronald A. Guzman for Dec. 12.
Connors was convicted of smuggling, trading with the enemy, conspiracy to trade with the enemy, and lying to a passport officer. Witnesses testified that in the early 1990s as the cigar fad was building in the United States, Connors went to Cuba by way of Canada and Mexico almost monthly, bought cigars, and brought them home with him.
Connors served as his own lawyer at his trial and accused the government of treating him unfairly. He said one of the Customs agents had cooked up evidence against him to avoid the embarrassment of failure after years of investigation. Jurists felt otherwise.
In most cases, Customs agents who find Americans returning with Cuban cigars merely confiscate the cigars. Connors was prosecuted due to the large number of cigars he smuggled.
Corona Cigar Co. Stocks Rare, Old Cuban Cigars
Orlando, FL - Corona Cigar Company is selling some of the rarest Cuban Cigars in the world at its new flagship retail store in Orlando, Fla. Jeff Borysiewicz, company c.e.o., said that he hand-carried the cigars on the plane back from this summer's RTDA trade show in Las Vegas, where he bought them at auction. "There is no way I was going to let these cigars out of my sight," said Borysiewicz. All of the cigars are in extremely good, smokable condition and are guaranteed authentic.
The oldest and rarest of the cigars in the collection is an assortment box of 1925 La Corona cigars featuring stone printed cigar bands, a hinge and clasp box, and bearing a U.S. tax stamp from New York City. A 1926 H. Upmann Variety box bears a Boston, Mass. import tax stamp and features five different shape cigars. Both boxes contain 25 cigars and are being offered as complete boxes only at $5,000 each.
Borysiewicz is also offering two other unique finds, both presented in aluminum cigar tubes, which were quite unusual for the time period: 1953 Hoyo de Monterrey Petit Coronation Tubos (4 1/2 x 40) and 1950 Montecristo Tubos (6" x 43). "Aluminum cigar tubes were very rare in the 1950s as the technology and availability of aluminum alloy was just being developed," notes Borysiewicz, adding "Large sized pre-embargo cigars are very hard to find due to the fact that most cigars produced during this time period were smaller sized cigars." Both cigar lines were made in Havana, Cuba and bear authentic import tax stamps. Corona is offering the Hoyo de Monterreys at $200 per tube, and the Montecristos for $300 per tube.
Cuban cigars produced before 1960 are legal to sell and possess in the United States.
Retailers, Manufacturers Fight Anti-Competitive Practices with Cigarette Majors
Orlando, FL - A group of six tobacco companies and thousands of tobacco retailers have launched an effort to seek legislative relief from anti-competitive cigarette trade practices of the tobacco industry's market leaders.
The movement, called "Retail Rights," brings together Brown & Williamson Tobacco Corporation, JT International USA, Lane Limited, Liggett Group Inc., S&M Brands, and Wind River Tobacco.
"Under the Retail Rights banner, these manufacturers and thousands of retailers are seeking state legislation," said Al Alfano, a spokesman for the group. "The alliance believes Philip Morris and others' trade programs deprive retailers of the ability to manage the cigarette category in their own stores," he said.
"These monopolistic programs exclude or limit the sale, display, advertising, discounting, and promotion of other manufacturers' products, and retailers who do not accept restrictive contracts are often penalized by a denial of promotions." The proposed legislation applies only to cigarettes.
"Retail Rights is a fight to open the market to fair competition and return control of the store to retailers," Alfano said. To date, nearly 13,000 retailers representing approximately 16,000 stores across the country have signed statements in support of the effort.
"This growing support, and these manufacturers who are joining, reflect widespread concern throughout the tobacco industry about Philip Morris's tightening grip on retail."
Under the proposed legislation, retailers could continue to enter into merchandising agreements with tobacco companies, as well as continue to receive display payments, slotting allowances, buy-downs, promotions, and discount programs. However, the legislation would prohibit a tobacco manufacturer from imposing terms on retailers that essentially force them to relinquish control over one of the most crucial aspects of their business.
In addition, manufacturers would not be allowed to link retail discounting to their retail merchandising contract programs, which in the case of the largest cigarette manufacturer, require retailers to exclude or severely limit the sale, display, promotion, and advertising of competitors' products.
"Passage of the legislation would ensure that retailers once again are able to match inventory with consumer demand," says Alfano. "Retailers also would find it more feasible to enter into merchandising agreements with all cigarette manufacturers."
Swedish Snus Website Attracts U.S. Interest
Stockholm - Snus World Wide, launched in October 2001, was created to market Swedish Match snus products to consumers globally over its Internet site, located at www.snusworldwide.com. While the site has primarily targeted Swedish consumers, the market is experiencing steady growth as distributors expand their customer base. In its first year, Snus World Wide generated $200,000 and attracted 3,000 hits on its website per month. Over one-third of the Web hits came from the United States.
Currently, the Internet distribution channel offers nine brands of Swedish snus in several varieties including Catch, General, and Ettan. In October, the site began selling and distributing Exalt, a new snus product from Swedish Match that is lower moisture content and packed in mini pouches.
"We are delighted to be one of the first to offer Exalt tobacco packets and expect strong sales from our customers both in the United States and in Europe," said Cecilia Nilsson, managing director of Snus World Wide. "We are committed to providing the very best quality products delivered at peak freshness and taste."
Swedish snus is a smokeless tobacco product that is offered either loose or in a pouch and placed in the upper lip. Swedish snus is both air cured and pasteurized, providing for a finished tobacco product of ultimate freshness and quality. In Sweden snus use is as common as smoking.
"Exalt should be a popular seller as more and more customers are seeking less harmful tobacco products. Scientific studies have shown that using products like Exalt reduces the risk associated with cigarette smoking and is a safer alternative," Nilsson said.
SMOKESHOP - Oct/Nov 2002