Carlos Fuente Jr. has become one of the most recognizable people in the cigar business. While at the helm of Tabacalera A. Fuente y Cia., he has seen the company rise to one of the preeminent positions in the industry.
Marvin R. Shanken
From the Print Edition:
John F. Kennedy, Nov/Dec 98
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CA: But does that mean that three years from now, you still expect to be releasing 750,000 to a million, or will you be able to increase production to 2 or 3 million cigars a year? What is the growth potential for Fuente Fuente OpusX?
Fuente:With the expansion of Chateau de la Fuente, we had almost 200 acres planted last year. We've been expanding that acreage for the last couple of years, purchasing more land nearby and growing more tobacco in the hope someday that we will be able to produce more cigars. The expanded tobacco production will probably be going into cigars by the middle of 1999. By the year 2000, if everything goes well, there's no reason why we won't be able to release between a million and a million and a quarter cigars.
CA: In 1999, however, production will be about the same as this year?
Fuente:Possibly a little bit more. We are making more cigars. So, I expect to release a little more.
CA: Do you have plans to release any new sizes of OpusX?
Fuente:Yes. We began making the Fuente Fuente OpusX Perfeccion "A" about two years ago with every intention to introduce the cigar into the marketplace. But it's such a special cigar that we were caught by surprise when we began donating them for charity and saw what kind of prices they were bringing. It was a very warm feeling to see the kind of money that the cigars brought in for charity, and for great causes. We realized that for us cigars are not about money, and this was a way for us to give something back to people. It was our intention to have cigars available for charities, and that's what we've been doing. We had only one cigarmaker. That's all he made: the Fuente Fuente OpusX Perfeccion "A". He made approximately 50 to 75 cigars a day, and the cigars began accumulating in the aging rooms. So now, we are going to release cigars that are about two years old in the aging rooms. They will be released sometime in the fall.
CA: What will the price be?
Fuente:The price will be approximately $25 each.
CA: The Opus One winery, which is a joint venture between the Robert Mondavi family and Château Mouton-Rothschild, sued you over the use of your trademark, Fuente Fuente OpusX, claiming that it infringed on their trademark and created confusion in the market. I know this lawsuit was a painful, difficult and expensive experience for you and your family. Now that a judge has ruled in your favor, can you speak about the whole matter?
Fuente:It has absolutely been a very painful two and a half years. It's been very difficult. When it first came about, it was really a shock to our family. It was totally unexpected. Our family had gone through difficult times in the past, but this was different. I try not to think about the lawsuit too much, but I can't help it. I ask myself, why did it happen? And, still today, I can't answer it. The only thing I tell myself, hopefully to find peace, is that this is another test, maybe a test of destiny, a test of God.
The Fuente Fuente OpusX--the cigar, the tobacco--was a lifelong dream of mine, and this is one of the tests that we had to go through. From the beginning of the project, it's been a test. From the dream to the planting of the tobacco, the controversy over whether it would succeed, and people saying it couldn't be done. It was a struggle from the beginning. We wanted to accomplish this so much, not just for us because we believed it in our hearts, but we knew it would be good for the Dominican Republic and for cigar smokers everywhere. And when something is done for the right reasons and when it's so successful, it's hard to answer why there's so much controversy. I don't have an answer why these things happen, but it's over. At least, I pray to God that it's over and I pray to God that no other tobacco family has to be faced with this.
The cigar business is not about legal matters. The cigar business is about families, about people who have their hearts in the business, people that sleep, breathe, live and dream tobacco.
CA: While the judge did rule in your favor, the case isn't really over yet because of the possibility of appeals, and that means you are still distracted. Hasn't this had an impact on your business over the past two and a half years?
Fuente:It will never be over for me. It's a part of my life. The lawsuit is now a part of our life's history. It's unbelievable when I think back to being in Ybor City [in Tampa, Florida] with my father and my grandfather, in a little wooden house that had a little cigar factory in the back. To think that 40 years later we have been in a legal battle with giants like the Mondavis and the Rothschilds. It's part of the history of our family, and regardless of how painful it has been, truth was on our side, and if we had to go back and plant little seeds of hope again, we'd go back and plant and go through it all over again.
The day-to-day distractions were enormous. I still can't quite believe it. The paperwork from our attorneys, the requests from the Opus One attorneys. I had no idea it would be such a battle. No matter how much we tried to stay focused on cigars, it was very difficult. Sometimes I wouldn't hear what people were saying to me. I had a lot of sleepless nights. I'm not sure I could have gotten through it without the support we got from people all over the country.
I was deposed at least three times. It seemed like psychological warfare. One time I had to change all my plans. I was told it would be a day of being deposed in Tampa, so I went there expecting to be back in a couple of days. It ended up being over a week. They were asking about things that had nothing to do with the cigars. And that happened three times.
The legal cost to the family was unbelievable; it was well over $2 million. And it's still going on. But it's not about money. It was about defending our honor.
The first day we found out about it, my father walked into my office and said, "Carlito, we are going to have a fight. People have tried before to take away our company, but I won't allow someone to take our company away from us. This is ours. We have to look at ourselves in the mirror every day." Even though it was going to be difficult, we knew what we had to do. It's not easy, but when you have a father like I do...he was the pillar for the entire family.
CA: Many of the other large cigar companies have been actively creating new brands in recent years. But your company has really stuck to the basics. Other than Fuente Fuente OpusX, you haven't launched a new brand owned by your company in several years. Why is that?
Fuente:Fuente is our family name, and because our name is on the cigars we make, we have tried to stay focused on that. In fact, it is the thing that motivates me to want to get to the factory. A Fuente cigar to me is the only thing I have. When I smoke one of our ci-gars, it's a bridge to my grandfather; it's our heritage, it's part of me. That's why we've been focusing on what we have, not trying to start up a bunch of new brands or new cigars.
CA: What are some of the other brands that you do produce for other people?
Fuente:Most of the cigars that we manufacture are either owned by our family totally, partially, or made under license. Some of the brands don't carry the Fuente name, like Montesino. Montesino is an old brand that we've been manufacturing for many years. We also produce Ashton, and that's a joint venture between us and Robbie Levin of Holt's Cigar Co. We also have Bauza, which is a brand owned by our company [marketed by Oscar Boruchin of Mike's Cigars in Miami]. And we make several brands for the Newman family, under license with the Newman family, such as Cuesta-Rey, La Unica and Diamond Crown. We also make Savinelli ELR and several others.
CA: Have you ever tried blending Cuban tobacco into an Arturo Fuente or Fuente Fuente OpusX blend? And if so, how did it taste?
Fuente:No, sir, I have not. But I would be very curious to find out what would happen.
CA: There are very few successful privately held companies. And in the cigar business, your leading competitors today are larger publicly held corporations. How does your family divide up the responsibilities between family members?
Fuente:It's very hard to separate out what each of us does. I think the only time we're divided is when we all sleep in different beds. We're family. And my father taught us that our responsibility is to do whatever is humanly necessary to make the product as great as possible. I think that is something that is sacred to us and we must never forget that Arturo Fuente Cigar Co. is not a company, it's a family.
CA: Does your father work as hard today as he did 10 years ago?
Fuente:Yes. If there was a way I could try to describe my father, he's like Vince Lombardi; what Vince Lombardi was to football, my father is to cigars or to cigar making. He's taught us all and he still teaches us all on a daily basis.
CA: But what area of the business does your father focus on?
Fuente:Every single day he goes from factory to factory. I only hope that someday I can fill his shoes. He's built a company. It shows his brilliance because he's done it without having a formal education. He's taught so many people, in every department of the company. He personally teaches people, he personally makes cigars, he's personally taught people how to ferment tobacco. He's covered all the different aspects of the company, and he still does it.
CA: I can't therefore draw the conclusion that you're the guy in the factory and he's the guy in the fields, or he's the guy in the fields and you're the guy in the factory. It doesn't work like that?
Fuente:It's a very fine-tuned family. My sister is so much involved in the business; my brother-in-law, Wayne [Suarez], is too. I don't look at Wayne as a brother-in-law; he's a brother. Whatever has to be done, we do. I mean, Wayne's in the Dominican Republic spending a lot of time, or he's in the States working there. My sister grew up in the tobacco business and she knows an extensive amount about tobacco, which may surprise some people. But she worked in the factory, just like I did, when she was a young girl, and she's done just about everything in the factory. She has her heart in the business, like we all do.
CA: There must be some division of labor?
Fuente:Although we are really one as a family, yes, we do still divide up some functions. Cynthia is primarily in administration. She spends most of her time in the office today. But Cynthia was for a time in sales and she traveled around the [United States]. But now with three children, she spends a lot of time in administration. Wayne is also in production, coordinating cigar production and shipment orders. He also spends a lot of time in the United States on the sales and marketing side. There is a lot of overlap with Wayne and Cynthia. Cynthia also goes to the factories and checks cigars. Wayne, too--he's always in the factory checking cigars. It's a family effort.
For myself and my father, we've been a team. But my father does everything. Everything. I spend most of my time with the tobacco: between the farms, blending cigars, creating the new shapes and sizes, and working on the packaging. But we do it all. All of us basically do it all.
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