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April,
2004

TRENDS AND TRENDSETTERS IN SPECIALTY TOBACCO RETAILING
Hookah Cafés on the Rise

The centuries-old Middle Eastern tradition of smoking exotic, water pipes hookahs in cafes is continuing to gain interest in the U.S. The hookah’s growing popularity is difficult to measure, but the industry estimates that at least 200 to 300 new hookah houses have opened over the past three to five years — many concentrated in California — but also on the east coast and often near college campuses.

Hookahs, often three feet high, use charcoal to heat tobacco, which is soaked in molasses or honey and mixed with fruit pulp. Up to three fabric hoses with disposable plastic mouthpieces allow several people to share. The smoke is filtered through water, giving it a smooth, sweet taste, say enthusiasts. While the practice in the U.S. has generally been geared towards cultural tradition, it has found a wider audience in recent years. From Evanston, Indiana’s Café Hookah to State College, Pennsylvania’s The Tall Shiva Hookah Lounge, the ancient tradition is experiencing a jolt of mainstream popularity.

In San Jose, Calif., a former coffeehouse and art gallery reopened in January as Hooka Nites Cafe. Owner Paul Zamot offers a smoking menu that includes traditional fruit-flavored tobacco blends (shisha) that incorporate fruit leaves, honey, and molasses for $10. But Zamot has also created more exotic offerings, such as “fresh fruit hookahs” where tobacco is placed inside hollowed-out fruit, such as pineapple or coconut, for $25 per smoke. The tobacco stays moist, notes Zamat, who says hookahs typically last anywhere from 30 minutes to one hour, and are generally shared among several friends.

Nearly half of the hookah bars in New York City are clustered in a small area of Astoria, Queens known as Little Egypt, owned mostly by Egyptian immigrants and frequented by men of Middle Eastern descent who sip juice, coffee, or strong tea while bantering or engaging in chess or backgammon. The cafés, however, are tangled in the city’s year-old smoking ban, which has been sporadically enforced for hookah bars. A city councilman there has attempted to gain the cafes the same exemption that has been extended to New York cigar bars, which is only valid in establishments selling alcohol. Unlike new-wave hookah bars catering to nightlife crowds, traditional hookah bars with Muslim clients do not serve alcohol.


Smoking Ban Fight Heats up in Nation’s Capital

The Restaurant Association Metropolitan Washington, which represents about 500 Washington, D.C.-area restaurants, has sued the D.C. Board of Elections and Ethics in an attempt to keep an initiative off the November ballot that would ban smoking in bars and restaurants in the city.

The suit, filed in D.C. Superior Court, is the latest move in a battle that began in September when anti-smoking advocates launched a campaign in Washington to ban the smoking of cigarettes, cigars, and pipes in all D.C. workplaces.

A push for a statewide ban in Maryland also is under way, but the Senate Finance Committee recently killed the measure, making its passage unlikely soon. Delaware, New York, Maine, Connecticut, Massachusetts, and California prohibit smoking inside certain places.


BITS & PIECES

  • Four former surgeons general called for a $2-a-pack cigarette federal excise tax in February as part of a plan to reduce cigarette use, raising an estimated $28 billion in additional revenues each year to fund a variety of cessation- related programs. The current tax is 39¢ per pack.

  • Connecticut governor John Rowland’s 2004-05 $14.2 billion state budget included a cigarette tax hike from $1.51 to $2.05 per pack which became effective April 1. The plan also increased taxes charged on cigars, chewing tobacco, RYO, and pipe tobacco.

  • Effective March 27, Pennsylvania retailers can only possess and sell MSA-compliant cigarette and RYO/ MYO tobacco brands. The state’s attorney general posts the Tobacco Product Manufacturer Directory Act at www.attorneygeneral.gov

  • eCommerce Today Ltd., which does business under the websites discountcigarettes. net and ecommercetoday. com, agreed in February to stop shipping cigarettes to California, settling a lawsuit that accused it of selling to minors and failing to report tobacco sales to state tax authorities.

  • In February, New Jersey Governor Jim McGreevey proposed boosting the state’s cigarette tax for the third time in three years. New Jersey’s current tax, $2.05 per pack, is the highest in the nation.

  • SMOKESHOP - April, 2004