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Sept/Oct
2002

Recharging the Spirit at RTDA

Halfway through a brutal year that has witnessed an unprecedented assault by state and city legislatures hiking tobacco excise taxes, the annual industry gathering of the Retail Tobacco Dealers of America (RTDA) came as a particularly welcoming opportunity to focus on the most positive trends in tobacco retailing. Thankfully, the news on the tobacco merchandise front has been overwhelmingly positive.

Manufacturers continue to respond to price-sensitive cigar smokers with price cuts on some lines, or more commonly the introduction of entirely new lines that are priced accordingly - great cigars as low as $3 to $4 per stick. For consumers willing to spend more, there are still plenty of choices, thanks to an expanding range of top-rate, aged tobaccos.

But even while prices have softened, premium cigar quality continues to rise, giving smokers far better value for their money than seen in recent years. Many of the developments are downright exciting. Cigar makers are increasingly turning to long-forgotten methods of fermentation and curing,marking a return to time-honored traditions that largely fell by the wayside or were abandoned entirely during the tobacco shortages of the 1990s. Many are also broadening their geographic options when it comes to tobacco sourcing, exploring less common origins or working with unusual or emerging tobacco strains. Even growers in traditional producing regions are raising the bar, from tireless efforts to grow quality wrapper leaf, often for use in true regional puros, to the development of proprietary strains to differentiate brands. So much interesting leaf is emerging, the possibilities seem endless. Many manufacturers, particularly small boutique operations, continue the trend towards vertical integration, gaining hands-on control of the entire tobacco growing and curing process to ensure stringent quality standards and greater flexibility that often can't be achieved when buying from the open market. For the consumer, it all translates into a wealth of tastes, and variations of styles, particularly among the medium- to full-bodied cigars.

The taxation question is never far from mind, though, and the gap between tax-free Internet and catalog prices and those of excise tax-compliant bricks and mortar shops continues to sap sales from small retailers, particularly larger ticket box sales of premium cigars. To this end, manufacturers -while nonetheless continuing to serve both distribution channels - are trying to help encourage customers to keep coming back to the local shops with a bevy of in-store promotions, events, and retail support, mutually beneficial efforts that consistent with their own brand-building goals.

And so, retailers can find many limited edition lines, special product packaging, and promos that are only offered through retail shops, all attempts to give the embattled local store a leg-up in a tough retail environment. Of course, retailers must look for ways to excite their customers too, and for those prescient enough to scour the RTDA show, great merchandise and retailing assistance could be found at every corner.

E. Edward "Ted" Hoyt III
Editor