A Conversation with the Padróns
José Orlando Padrón, Chairman Jorge Padrón, President
From the Print Edition:
Adrien Brody, September/October 2010
(continued from page 2)
Senior editor David Savona spent time with the Padróns recently in Nicaragua, touring their fields, factory and tobacco warehouses, smoking cigar after cigar, and sat down with Jorge and his father for a long and wide-ranging conversation about the long journey from fledgling company to industry standout. Jorge translated the portions spoken by his father.
David Savona: Señor Padrón, what has been the biggest obstacle you faced in all your years of making cigars?
José Orlando Padrón: The biggest obstacle I feel I faced was in May of 1978, when there were already problems in Estelí [Nicaragua] because of the pending war. I was going to Costa Rica. There were so many problems in Nicaragua, I was analyzing the possibility of opening a factory there. On May 24, 1978, Caesar Gadea Sr. called me at the hotel in Costa
Rica and said "Don Orlando, it's over." They burned the factory down on the 24th of May. They burned the factory and the warehouse in Estelí.
Q: So he meant your business was over?
José Orlando Padrón: Yes. The day they burned down the factory, the next day I came back to Nicaragua, to Estelí. During that time there was rioting, there was a lot of uncertainty. That day there were 18 buildings set ablaze.
Q: It must have been frightening.
José Orlando Padrón: Those moments are the moments men have to fill themselves with courage. In the face of that is when you find a person's character.
Q: Was your factory insured?
José Orlando Padrón: I had insurance, but not enough to cover the damages. I had the good fortune that many of the people who worked with us helped us and cooperated with me. A little more than 30 days later, I opened up a smaller factory in a house we had rented. I was fortunate enough that I didn't have all my raw material in one warehouse. I had it all throughout Estelí. There were people who were able to salvage some bales as [the factory] was burning. I gave a thank you gift of money, thanking them for returning it. After the fire, I went and I bought a lot of raw material, and I sorted and deveined the tobacco myself.
Q: When did you open the new factory?
Jorge Padrón: June 26, 1978.
Q: What happened then?
Jorge Padrón: After that, things really got bad in terms of war in Estelí. A lot of the employees would tell him, "Don Orlando, get out—the boys are coming."
Q: Who were the boys? The Sandinistas?
José Orlando Padrón: The rebels.
Q: Did you ever fear you would be killed?
José Orlando Padrón: I thought about a lot of things, but what other alternative is there? You just keep going forward. Having gained the experience of the fire, I started separating tobacco even more.
Q: Moving it to other places, to spread the risk?
José Orlando Padrón: Yes. In Managua I had 300 bales.
Jorge Padrón: He didn't want to have it all in Estelí.
José Orlando Padrón: There was another lot of tobacco we had in Condega. Then I had another 200 or 300 bales in Estelí. In July of 1979, the revolutionaries took over Nicaragua. At that point, Leonardo Lainez, who was our accountant, under gunfire in Managua moved 300 bales of tobacco to the airport where they left on a cargo plane to take it to El Salvador, from there to Puerto Cortez [Honduras] and then to Tampa. The bales that we had in Condega we moved over the border to Honduras.
Q: How? With trucks? Was it difficult?
José Orlando Padrón: I had a few people who did that for me. The bales that were here in Estelí the employees protected. The only thing I lost from that factory was a little scale that I used to weigh tobacco.
Jorge Padrón: Estelí was one of the worst places in terms of fighting during the war.
José Orlando Padrón: After the triumph of the Sandinistas, the employees here went on strike. I had a makeshift factory in Honduras.
Q: This happened before the U.S. embargo on Nicaragua.
José Orlando Padrón: Yes. All of this is happening before the embargo. The employees were working by themselves, alone.
Q: For how long?
Jorge Padrón: For one year.
José Orlando Padrón: They would make the cigars and ship them to Miami. I would send the money, but it was too dangerous [to come.]
José Orlando Padrón: I wasn't afraid of the people of Estelí, but others who didn't know me, who might have different agendas.A year after that, one of our employees sent me a letter requesting that I come back. They were running low on raw material. I said, "I'll go, but I want to make sure the commandante of the Sandinista army in Estelí is there." His name was Elias Noguera. The day I arrived, all the employees were present, along with Noguera. I asked him, "I came here to find out if I'm going to be accepted here in Nicaragua, or not." I said "All these people who are gathered here today are here because of what we've done at Tabacos Cubanica. Families who depend on us. If you feel I won't be accepted or welcome, I'll leave the factory, and I'll leave it to them." He said "Don't worry-you'll have no problems in Nicaragua. You're a person who has not been involved in politics." I told him "All the farms are controlled by the Sandinistas. I need to know if I can continue to have access to raw material in Nicaragua." And that's how I was able to function up until 1985. On April 20, 1985, President Regan declared an embargo on Nicaragua. I was in Miami.
Q: What did you do?
José Orlando Padrón: The embargo said U.S. citizens had seven days to remove all property from the country. I tried to get an extension from the U.S. government. The Department of the Treasury allowed me until September. We took out between 4 and 5 million cigars in a short time span—we were working day and night.
Q: And that amounted to about one year's production for you at that time?
José Orlando Padrón: It was not enough. At that time I was selling 5 or 6 million cigars a year in Miami alone.
Q: Did you shut the factory in Nicaragua?
Jorge Padrón: The factory kept operating as long as it could, but it had to close.
Q: How long was it closed?
José Orlando Padrón: Five years, from 1985 to 1990. I told the employees, "Do what you can," and I kept sending them money from Miami.
Q: What happened to Padrón during the war?
José Orlando Padrón: We used to make 6 million cigars a year in Miami. When the war came we had to go down to 2 million because we didn't have the tobacco.
Q: You never opened in Costa Rica, but you did go to Honduras. What changes did you make while you made cigars in Honduras?
José Orlando Padrón: I never used Honduran tobacco. That's why I had to cut back production. My philosophy was it was worthwhile to maintain quality.
Q: You weren't getting more Nicaraguan tobacco from across the border?
José Orlando Padrón: No. I wasn't making 5 million cigars a year when I moved to Honduras. Production went down. I never wanted to vary the blends in our cigars.
Q: Were you losing money while you were in Honduras?
José Orlando Padrón: I've never lost money in this business. To run a business is a very important thing. It's almost like an art. I wasn't making what I was making before, but the company never lost money. Another very difficult time was in the early '80s. The embargo still hadn't taken effect, but I was up in Honduras and Nicaragua. At one point there was a plot to kidnap me. When I was in Nicaragua, I would live in the factory. I had a small room in my office.
In Honduras, it was the same. This is a true account of exactly what happened. One day I get a call from Tegucigalpa [Honduras]. "Don Orlando, I need to speak to you, but I can't do it over the phone." A woman had gotten on a bus in Danlí and there were two men holding a bag. They asked her what time the bus leaves. One of the guys said to the other, "Let's go have a beer." The bus leaves without them, and they never took the bag. When this woman got to Tegucigalpa, she opens the bag and sees what's inside: two passports and the layout of my factory in Danlí, with information on where I slept. It had a description of all my movements, when I would leave-everything. They were Nicaraguan nationals. I went to the equivalent of the FBI in Honduras, I came to Nicaragua and showed a security person and I also went to the FBI in Miami.
Q: What happened?
José Orlando Padrón: We still have the passports in my safe in Miami. One day one of the two men was found dead, five bullet holes.
Q: What happened?
José Orlando Padrón: I don't know. I think he was just a delinquent.
Q: And the other guy?
José Orlando Padrón: They never found him.
Q: Did you hire guards after that?
José Orlando Padrón: No. But I did install a remote control starter on my car, change my routes and put cameras at the house. I changed a lot of things that I did. Thank God I'm still alive right now. The most important lesson in all this is to have as few enemies and as many friends as possible.
Q: Was this your darkest hour?
José Orlando Padrón: No. I believe the day that I die is already marked on the calendar.
Q: Jorge, I ask you the same question I posed to your father: What has been the biggest obstacle you have faced in your years of making cigars?
Jorge Padrón: We're lucky. My generation hasn't had to face the same problems-the fires, the bombing, the starting of a company from scratch. What kind of challenges have I faced like that? Nothing. My challenges are all different. Improving on what has been done. It's trying to understand and appreciate what my father did, and all the sacrifices are worth it. Growing the company. Having the restraint to ensure that it doesn't get compromised.
Q: And what do you focus on at the back of your mind through all this? What's the driving message?
Jorge Padrón: The integrity of our family name. The integrity of the name and understanding all these sacrifices he mentioned. It's the respect of the brand first.
Q: Jorge, what type of company was Padrón Cigars when you first started?
Jorge Padrón: I had no doubt we had a great product. But it takes time. At the time we were a highly regarded brand, but not at a national level. My father was able to sell cigars in the most difficult market-to Cubans in Miami. The bottom line is we had a great brand when I started there.
Q: I think some would assume it would be easier to sell cigars in Miami, given the number of cigar smokers.
Jorge Padrón: The market in Miami was very demanding. It wasn't like today. In those days a guy would walk in to buy a box of cigars and I might show him 20. I would bring at least six or seven boxes for him to look at. Today most consumers walk in, buy a box and then leave.
Q: When did you do that, sell cigars to the customers?
Jorge Padrón: I've done that my whole life. In a family business, you do a little bit of everything. If a customer came in and there was nobody at the counter, I took care of him. When I graduated and I got my degree and started working for the company full time, the company was already 28 years old. My father had sold almost 100 million cigars. It's not like we were trying to reinvent the wheel. Padrón was an established brand, well recognized in the Cuban community in Miami. When I came on board, we started selling to retail stores. I felt we could create something that was different, that could enhance the brand. Back then, the marketplace wasn't what it is today. In those days, you had either very strong cigars or very mild cigars. I think the Anniversary Series changed the landscape of the marketplace in the U.S. market from a taste standpoint. I just think it was a very refined taste.
Q: It's not a strong cigar, and it's certainly not a mild cigar.
Jorge Padrón: That's what we say all the time. Strength is just one trait in a cigar, but it's by far not the most important part. There are people out there who like smoking strong cigars, and that's fine. You can have a cigar that is deceptively strong but very flavorful, and that's what we go for. We're going for flavor. When you ask my father about a cigar, he says either it's good, esta bueno, or it's not good, no esta bueno.
Q: I bet your father is a pretty tough judge of cigars.
Jorge Padrón: Listen, my dad is a lover of cigars. So if someone gives him a cigar that he likes, he'll tell him. He doesn't smoke other people's cigars, but if someone gives him one he'll smoke it out of respect. He's very honest. He doesn't play games.
Comments 2 comment(s)
Brian Emerson — El Paso, Texas, USA, — November 28, 2010 7:50pm ET
Robert Martin — Flushing, New York, Queens, — September 30, 2011 6:05pm ET
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