An Interview with Oscar Boruchin
Owner of Licenciados and 8-9-8 Collection cigars.
Marvin R. Shanken
From the Print Edition:
Wayne Gretzky, Mar/Apr 97
Oscar Boruchin owns some of the most sought-after brands in the United States today: Licenciados and the 8-9-8 Collection. Boruchin, 63, has built those brands over the last 15 years since he left a job with General Cigar Co. to become a part owner of Mike's Cigars, a cigar shop institution. Today, Boruchin is the sole proprietor of the business, which includes not only his brands, but a large wholesale and mail-order operation and a world-class retail store in the exclusive Bal Harbour area of Miami Beach.
Boruchin's story is a true rags to riches tale. He fled Cuba after the family business was nationalized in 1960, arriving in Miami "virtually penniless." He began driving a cab, scrambling to support his family. His association with the cigar business began when a customer, a Cuban exile fresh off the plane, paid his cab fare with cigars, the only possession of value Fidel Castro allowed his countrymen to take out of the country.
Boruchin has a rare vantage point in the cigar industry. He is a brand owner, a wholesale supplier of other retailers and a retailer. He has seen a small, profitable business grow into a $22 million-plus enterprise in the space of four years. And, he's recently opened a spacious new store, confident that the cigar business will remain strong. Marvin R. Shanken, editor and publisher of Cigar Aficionado, discussed all aspects of the cigar business with Boruchin in a wide-ranging interview.
Cigar Aficionado: You are a Cuban-American. Tell us about your life before coming to America.
Boruchin: My father and mother were born in Russia. They came to Cuba thinking that they would be able to go on to America--pretty quick. But after three or four years in Cuba, when they finally had the opportunity to come to the United States, they felt that the Cuban people were so nice, and that they were making a living. They decided to stay.
CA: What year was that?
Boruchin: My father came in 1923 and my mother came in 1926. He left her behind in Europe--she was his girlfriend--and then he brought her to Cuba and married her. So it was the late 1920s. I was born in Havana in 1933. My father owned a little store in the country for a long time. I went to school in Havana.
CA: Your father had a retail store?
Boruchin: My father had a general merchandise store in a little town called Calimete. Calimete is in the Matanzas province, almost on the border with Las Villas. It was about five hours away from Havana, near a sugar mill.
CA: How old were you and what year was it that you came to America?
Boruchin: I came to America in 1961. I was 27 years old.
CA: Where did you go to college?
Boruchin: In Havana.
CA: What did you major in?
Boruchin: I didn't major. I married and I never finished college. I went to work with my father-in-law in the shoe business. We were big importers of materials to manufacture shoes. When Castro came in 1959, we were well established. I didn't leave Cuba because I was persecuted but because my business died. Importations were not allowed. All the shoe factories were intervened by the government. I had no way to make a living. Since I had no way to make a living in that system, I felt it was not one in which I could progress.
CA: Do you still have family members in Cuba?
Boruchin: Very few. A couple of cousins.
CA: But you were the first in your family to leave.
Boruchin: I was the first one in my family to take the jump, in 1961.
CA: What was it like? Did you have difficulty leaving Cuba to go to America?
Boruchin: I had no difficulty because I always had an American visa. I used to come very often to the United States. I would travel here eight to 10 times a year on business or vacation. So I always had a current visa. For me to leave Cuba in 1961 was very easy. I just picked up a ticket and went to the airport and left. There was no problem leaving the country, although sometimes you would be subjected to searches. Because I left the country so often even before leaving for good, I would just go directly to the security office, because I knew they would automatically search me.
CA: What were they looking for?
Boruchin: In my case, money. American money. They wanted to see if I was smuggling money out of the country. But I never did. When I finally did leave, I left alone. My family--my wife, Rosita, and my one-year-old daughter--followed a few days later. You could call it penniless. I had maybe $2,000 in the United States. My in-laws came a few months later and my parents came three years after that.
CA: What did you do when you arrived in Miami? Did you have friends, relatives? How did
Boruchin: I had very few friends. I had nothing to do and very little money. We had an illness in the family at that time and no insurance because I was just a newcomer. So, the little money that I brought in disappeared quickly with doctor bills and stuff like that. I started to drive a taxi, and I was making about $40 a week for a few months.
CA: Forty dollars a week?
Boruchin: I was driving this car 10, 12 hours a day and essentially looking for Cuban fares because I didn't speak English. There was no way I could understand an address in English. I was going to the airport and waiting for the Cuban planes, which used to come two times a day. I was trying to take Cuban passengers. Otherwise, I stayed close to the refugee center in Miami and other places where Cubans would congregate. It was the easiest way for me to communicate and take fares. That's the way I got into the cigar business.
CA: How could you live on $40 a week?
Boruchin: It was 1961, and although $40 a week wasn't too much money, it was maybe the equivalent of $150 a week today. We--my father-in-law, mother-in-law, my wife and me and the baby--were in a one-bedroom apartment in Miami Beach paying $60 rent. We were making a living. We were struggling. It was a big change, because we had a much nicer life in Cuba. We weren't multimillionaires. But I was doing well there.
CA: Can you explain how your taxi driver job led you into the cigar business?
Boruchin: One day, I picked up a Cuban family at the airport. When we got to the destination, they had no money to pay me. But they were carrying a box of cigars because Castro let everybody out of Cuba with one or two boxes. They suggested that I could collect the fare with a box of cigars. I took it. I didn't know if I was going to lose money or make money, but I took the box of cigars for the fare and I went to Miami Beach, to Zelig's on Lincoln Road. He gave me $10 for that box.
CA: What was it? Do you remember?
Boruchin: Oh, yeah! Montecristo No. 4. Now, I figured if I could go to the airport and buy the cigars for $9 a box and manage to buy 10 to 15 boxes a day, I would make more money than driving a taxi and I wouldn't have to work 12 hours a day. So, I took a little money and went to the airport. The Cubans arrived without a penny, and the only thing they had that could be converted into money was that box of cigars.
CA: What did you pay for a box of cigars?
Boruchin: Nine dollars.
CA: What did you sell it for?
Boruchin: Ten dollars.
CA: You only made a $1 profit on each box?
Boruchin: Don't forget that I was buying 10, 12, sometimes 15 boxes at a time. In my mind, I was thinking $15 a day would be over $100 a week. That was two and a half times what I was making driving a taxi. For me, it was tremendous. Within two months, it de-veloped into a tremendous business. Two months later, I had people helping me. I was buying a couple of hundred boxes a day. I didn't have a market in Miami. I came to New York to sell the surplus.
CA: In 1961, what brands were people bringing with them?
Boruchin: They were bringing Por Larrañaga Cedros, Romeo y Julieta Churchills and a lot of H. Upmanns, which was the easiest cigar to get in Cuba at the time.
CA: Did you offer different prices for different-sized cigars?
Boruchin: No, every box was $9. Size didn't matter. Brand didn't matter. Nothing else.
CA: You started selling the cigars in New York?
Boruchin: The Miami market got clogged up. I couldn't sell anymore. I didn't sell them to Mike [Mersel, former owner of Mike's Cigars] because he wanted to pay too little money. But Zelig [Gimelstein] was paying me the $10, also any size, any box. You can imagine he was making a killing. At one point, however, he owed me money. He couldn't get rid of the boxes as fast as I was buying them. It was funny. A lot of people at the airport distrusted me, and they wouldn't sell me any cigars. I would give them a card with my telephone number. At first, I did it as a joke, but within a couple of weeks my wife was spending 20 hours a day answering the phone from people who wanted me to come pick up the cigars they hadn't been able to sell.
CA: Was there anything illegal about your activity?
Boruchin: I don't know. I never checked. I paid my taxes at the end with my accountant. I don't know if it was illegal. I don't think it was.
CA: When the glut developed in Miami, you came to New York with the cigars. Who did you sell them to?
Boruchin: The people who were buying from me in Miami were shipping the cigars to New York anyway. I found out about that, and I took a plane up here. I ended up on 86th and Broadway at a little tobacco shop owned by Mr. Danny Blumenthal [today, the owner of Villazon].
CA: How did you know that he was a buyer?
Boruchin: Somebody told me about three or four people in New York, and that he used to advertise Cuban cigars for 60 cents each on a big sign on the wall. So I figured he had a lot of Cuban cigars. I sat down in his office, and I asked him for $12 a box. He nearly broke my arm shaking it. He never said yes or no, but he always paid the freight. I shipped him all I could buy. And he bought. I kidded with him not too long ago that I wanted some of my cigars back. I was shipping almost an unlimited amount, and he was selling everything.
CA: But we're talking about hundreds of boxes that you were basically buying one or two boxes at a time from all the people that came off the planes. Were there not importers bringing in large quantities?
Boruchin: No, I was buying them one by one from the public.
CA: How long did that last?
Boruchin: About seven or eight months, and then Castro stopped allowing people to bring the boxes of cigars. My business died immediately.
CA: By now, it must be 1962.
Boruchin: Yes. And I was out of business. Zelig owed me like $6,000 or $7,000 for cigars.
CA: You must have been doing very well if you could operate and have some guy owe you that much money.
Boruchin: I was making a few hundred dollars. I already left the poverty level at that point. I wasn't poor. So, Zelig had two stores. One of them was located on Lincoln Road and one on Alton Road inside a drugstore. The owner said to me, "Now what are you going to do?" I really had no idea, but I knew the cigar business a little, especially the Cuban end, so he suggested to me that to pay off his debt to me, I could take over the little store on Alton Road in Miami Beach. I asked him, How much could I make? He said, "Oh, you can make, easy, $125 a week. In 1962, $125 a week wasn't bad. And I would be working on my own. I figured I could do a little better because that store had an absentee owner. I knew I would take better care of it. That started the most terrible period of my life. The store was open from 7 a.m. to 1 at night. We used no help. So, it was me, my wife and my father-in-law taking care of that little business without any help. It was a neighborhood store and we were selling, two, three hundred dollars a day. Cigarettes, candy.
CA: Did you make a $125 a week?
Boruchin: I was able to do better. But, if you divide that between the hours I was spending in the store, it worked out to about 30 cents an hour.
CA: What was the name of the store?
Boruchin: The drugstore used to be called the Hotel Pharmacy, and our store was called the Hotel Pharmacy Tobacco Shop. It was inside the pharmacy. From there, we acquired another little store on 5th and Washington, which was the heart of Miami Beach at the time. It was near the gymnasium where Cassius Clay used to train before he changed his name to Muhammad Ali. There was some action there with the Dundee brothers as the promoters. They brought a lot of big smokers to that area. I had the tobacco stand right under the gym. We did very well there but we were open 20 hours a day. So, it was a tremendous stress.
That's when I met the regional sales manager for General Cigar. They used to call on me because I used to buy a lot of White Owls and Tiparillos and a lot of brands. This guy liked me, and he used to say he didn't understand why a young man like me had to be behind the counter selling cigars to these old people. He said my future was maybe to work for a cigar company. He felt that if I came with him and I worked the way he expected me to work, he promised me that I was going to do very well with the company. He was a big inspiration for me. His name was Earl Casten. I give him credit for building General Cigar's business in the South. He offered me a job as his supermarket man. At that time, many supermarkets sold cigars and had big displays of cigars. They told me that if I went into a place that is not a supermarket, I would be fired. My job was strictly to go into supermarkets and launch the distribution and make sure General Cigar got the most prominent position.
I had an edge against the other salesmen because I still had my cigar stand. I used to take the other guys' cigars off the rack, put General's in and bring the other cigars to my shop. I had no problem. The other people couldn't do it because they couldn't get rid of the cigars. I did a hell of a job in supermarkets.
CA: That's a very creative approach to selling.
Boruchin: Taking the competitor off the shelf? Yes, it was, but the General people liked it and that's the way I started with General Cigar in 1963. By the way, I started with $85 a week salary.
CA: But you kept your stores?
Boruchin: I did keep them. But I promised myself that the moment my salary went over $120 a week, I would sell the stores. I used to finish at 5 p.m. with General and run to my stores. It was really stressful with the long working hours. But it didn't take me too long to reach my goal, and I sold both stores.
CA: What year did you sell the stores?
CA: How long did you stay with General Cigar?
Boruchin: Until 1981, about 19 years.
CA: Were you successful at General?
Boruchin: I had a tough time at the start. General had a lot of personnel, and I basically washed floors. I was the guy that came last.
CA: You were the bottom of the totem pole?
Boruchin: My immediate boss harassed me all the time. He didn't believe that I was making that many calls, and doing such a good job. He actually told me that I was showing up everybody, and maybe I should slow down. At first, he just didn't believe me, and then he spent some time with me and realized I was doing the job. What was happening was that the factory guy would go home at 2 or 3 in the afternoon, and I, like a jerk, used to work until 5 p.m. I finally had to go to Mr. Casten and complain to him because I was being put in such a difficult situation. I was just showing up the rest of the people. I told him the story and he got very upset. He called a sales meeting and gave me a title--a special projects supervisor. That meant I worked directly for him and didn't answer to anybody else. He started using me in different parts of his region, sending me to Georgia to work on certain accounts, and with certain men.
CA: I would say he made you a troubleshooter.
Boruchin: Yes, but it was a huge break for me. In a second, I was promoted over people who had worked with the company a long time. It put me in a position where they were practically working for me. It created a lot of jealousy.
CA: The Cullman family owned General Cigar at that point, but it was mostly selling machine-made cigars. Is that right?
Boruchin: Yes. After I came to the company, General acquired Gradiaz Anniz, which owned the Gold Label brand. They were experimenting in Jamaica, and some of those factories were making the Macanudo brand there. The only popular brands at that time in my area were Don Diego and Flamenco; they were made by the Menendez and Garcia family in the Canary Island. They were the keys of the high-grade market. I don't remember anything else at that time competing with them.
CA: But it was basically a mass-brand, machine-made business.
Boruchin: Yes. Things like Tiparillos, White Owl, Robert Burns. Tiparillo came on very strong after the [U.S.] surgeon general came out with his report about the problems with cigarettes.
CA: How big was the Cuban cigar market in the early 1960s?
Boruchin: After the embargo, it was pretty small. There were some cigars left over, but when they ran out, you couldn't get a Cuban cigar in the United States. It's not like today that they are available practically all over. When they were closed down, Montecruz, Don Diego and Flamenco became tremendously popular. They were the high-grade cigars at that time, and they were priced between 40 and 65 cents.
CA: When you left General Cigar in 1981, what was your position?
Boruchin: Earlier I had been assistant regional manager to Mr. Casten. I was his assistant already with responsibilities in certain areas. He had much more territory and I was in charge of quite a few states. Casten passed away at the age of 65 and General made me, I can't tell you what year, regional manager. It was probably about 1974.
CA: So by that point, you had pretty much reached the top?
Boruchin: It was one of the five or six bigger positions in General because I think we were divided into five or six regions.
CA: Was General Cigar's business growing even though the market was shrinking?
Boruchin: I am proud to say that in my territory, there were increases every year. When the Macanudo brand came on the market [in the early 1970s], it was a tremendous boost. The first year, year and a half, we had a tremendous fight, but the Cullmans really are cigar people, and the effort and the consistency of quality that they insisted on for Macanudo made it a success.
CA: Was there a fight with the brands already on the market?
Boruchin: Gulf & Western had acquired Consolidated, so it was a fight between us and Don Diego.
CA: Don Diego was a Canary Island cigar at the time. Was it the biggest competitor to Macanudo?
Boruchin: Yes, but Flamenco and Montecruz were important, too. The big break for me was when Consolidated moved its operations to the Dominican Republic. People didn't like the quality and the product as much. Macanudo became really strong because the quality was there. At that time, Macanudo [Rothschilds] sold for 75 cents.
CA: Let's see, you've risen up the ranks of General Cigar, you have a large territory in the United States, and you decide in 1981 to get back into the retail business, which is where you started. What caused you to go back to retail?
Boruchin: Mike [Mersel] was one of my biggest customers in Florida. For a long time he had been telling me that he wanted to retire. He was tired and he wanted me to buy the store.
CA: Had Mike's store always been in that location on Arthur Godfrey Road in Miami Beach?
Boruchin: Yes. Since 1950. It was one of the biggest players in the South in the cigar business. As a matter of fact, only Lew Rothman and Famous Cigars were bigger than Mike's. That was true even though Mike's volume didn't reach $2 million a year in 1981. But he was one of my big customers and he kept telling me that I could make more money working for him if we established a wholesale operation. And working for General had its limitations. I was traveling 40 weeks a year. I also knew that one day I wanted to have my own business. I set my mind to creating the wholesale division. But it wasn't easy. I was making decent money with General and I had all kinds of assurances from them. But the decision was essentially made when Mike called me one day and said that his lease would expire in the summer. He had about eight or 10 months to go. He said, either I come with him or he was going to liquidate the store.
CA: Did he want you to come work there, or to buy it?
Boruchin: He gave me 33 percent of the company to start. That still made me an employee, because the other 67 percent was owned by him and his brother. But my relationship with Mike, even when he was my customer, was very special. It was sort of a father and son relationship, and through the years has developed into a very strong relationship. So, in 1981 I started at Mike's.
CA: When you left General Cigar and went back into the retail business, were there any problems because you left or did they accept it?
Boruchin: I don't think they totally accepted it. But the friendship was always there. My immediate boss at that time was David Berg. David and I had an excellent relationship. Now, Mike was also one of General's biggest customers. He had an agreement with Morton Annis, even before General acquired Gradiaz Anniz, where Mike got all the seconds. So Mike was a big customer. But it was like General got an employee for free in me. My pride was the introduction of Macanudo, and I felt very responsible for it even though I was working at Mike's now.
CA: When did you buy the entire operation?
Boruchin: In 1985, I bought the whole company.
CA: When you started in 1981, what were the total sales?
Boruchin: Less than $2 million a year.
CA: What were the sales in 1985?
Boruchin: In '85 we grew the business to about $4 million.
CA: Does that mean that most of the growth was in the wholesale business?
Boruchin: Yes. Don't forget Mike didn't carry a full line [at retail] of merchandise from everybody. When I came in with the wholesale operation, he was only carrying two or three sizes of the Te-Amo. Then we added the whole line. He was only carrying two or three sizes of Montecruz. We added the whole line. The only company where Mike was carrying the whole line was General Cigar merchandise. While he was adding all of this merchandise for wholesale inventory, retail sales grew, too, in the different sizes.
CA: Did the retail business grow the same as the wholesale side or did it contract?
Boruchin: Our retail business was growing in a dying industry. A lot of retailers were going out of business. A lot of small shops were closing. But we were discounters. We were a consumer-oriented company. We were offering popular cigars at a tremendous price.
CA: Where did most of your business come from--residents of Miami Beach or tourists?
Boruchin: It was a combination. When I arrived, Mike had discontinued his mail-order business, so most of the business did come from the residents and tourists. In 1985, I started the mail-order again. Luckily, he had kept his records, so the minute I had full control of the company, I put out a letter which went to maybe 4,000 or 5,000 names. I re-established the mail-order side. We have been growing ever since. But other stores kept going out of business. They couldn't afford the rent on the malls or whatever. Maybe we were selling fewer cigars, but our share of the market was growing.
CA: I remember when I visited Mike's in 1991, the thing I loved about it the most was--forgive me for saying this--but it was a dumpy, almost garage-like store that was loaded with merchandise. Anyone who loves cigars would walk in there and thought they died and went to heaven. It wasn't fancy. There was nothing elegant about it, it was down and dirty. The counter cases looked as if they had been there since 1950. Which cigars were selling well then?
Boruchin: Te-Amo was always very strong, and Montecruz and Don Diego were also very strong brands. All the national brands were doing well. We also did a tremendous business in the seconds of Macanudo and Partagas, which we had an exclusive on from General Cigar.
CA: Did people know they were buying seconds from Macanudo?
Boruchin: Yes, they did. We didn't necessarily advertise it, but sometimes the sales staff would tell people. Normally, we just said they were seconds of the best brands on the market. People understood, because the sizes were identical and the color of the wrapper was identical. But we were careful. We felt, and General Cigar felt, that it might hurt the main brand.
CA: You have the three tiers of your business--mail order, wholesale and retail. By 1995, what were the total sales of your business?
Boruchin: Last year, we did about $11 million.
CA: What was it in 1992?
Boruchin: We did around $7 million in 1992.
CA: In 1996, what are you projecting now?
Boruchin: Over $22 million. We've doubled the business.
CA: In one year?
Boruchin: In one year.
CA: Of the $22 million, how much is mail order, wholesale and retail?
Boruchin: At one time, wholesale was 80 percent, 85 percent of my business. Today, it's 50 percent. The reason in the change is that our retail business has increased so much that no matter how much more the national companies have been giving us, we don't have enough to wholesale it. We are selling directly to consumers. The store is tremendous. The mail-order is tremendous. So, wholesale and the retail side is about a 50-50 split.
CA: When you moved to your new store last year, you were very nervous because you went from a little hole in the wall to a good-sized store.
Boruchin: We went from 1,800 square feet to 16,500 square feet. And, instead of renting, we bought the building for over a million and a half dollars.
CA: It sounds like you did the right thing.
Boruchin: God knows. The business was already pointed in the right direction two years ago, though. And, it looked like we couldn't continue on Arthur Godfrey Road. I was convinced that I had to move in order to even maintain the business that I was doing.
CA: It would seem that maybe the biggest change from a retailer's or a wholesaler's point of view would be that in the '80s you could get as much of any brand as you wanted, and today you're dependent upon your relationships with the manufacturers. Is that true?
Boruchin: Yes. But we were lucky. We were in a position in the market when the Cigar Aficionado revolution came that helped us cash in. We were probably the second-largest company in the United States in the cigar business. We were in the right place at the right time.
CA: Second to JR Tobacco.
Boruchin: Yes. By the way, we are very friendly competitors and personal friends. He [Lew Rothman, owner of JR Tobacco] is one of my largest suppliers of cigars.
CA: Many cigar lovers are frustrated about how difficult it is to get their favorite cigars. They always ask, "How long will it be before we can get the established brands?" What do you think?
Boruchin: I think every manufacturer is making tremendous investments, from growing tobacco to training cigar makers to making more boxes. You know the shortage of boxes is one of the biggest problems, even though it's not mentioned very often. I would say that if the consumption continues to grow at this rate, [we may never catch up]. If at one point, the growth does slow down, the bigger manufacturers will catch up. I actually hope it never happens, even though some people are frustrated. You know why? There're a lot of great products on the market, and a lot of new products are coming to the market. Some of them are great, and you can still find good cigars. When I left my place in Miami, I had a good supply of almost every major brand. That doesn't mean that two weeks from now we might not be out of everything.
CA: You haven't been able to build up inventories?
Boruchin: Not on the major brands.
CA: Have you ever been able to keep large inventories for an extended period?
Boruchin: Not really. We always turned over stock, even though we keep a large inventory because of the nature of our business. But we kept reordering practically every week. The merchandise used to be available. What is not available anymore is deals. Everybody used to wheel and deal at that time to compete. And merchandise could be bought cheaper. It's been one of our main concerns because we were always consumer-oriented. But we are a consumer company and we were always trying to give the consumer the best deal available. It's been tougher now. We are not able to offer the consumer the same business that we did before. Merchandise is so short. It's impossible to get the deals that we used to get before.
CA: Let's change the subject. You are Cuban-American, living in Miami and in the cigar business. Doesn't that put you at the center of a hurricane?
Boruchin: Definitely. When you live in south Florida and you have a million Cubans, the subject of Cuba is unavoidable. It's subsiding a little now. The conservatism of the Cubans of 10, 15 years ago is not that much anymore. For me, a Cuban cigar is the best cigar in the world. I don't care who gets mad. But I don't sell them, and I fight anyone who does because today, Cuban cigars are my biggest competitor. I'm located in an area where most of my customers are affluent people. They all have access to Cuban cigars. Sometimes they are counterfeit, because the popularity of the Cuban cigar has brought counterfeits into the picture. But whether they are real or counterfeits, I'm losing a tremendous amount of revenue because these people would be smoking the cigars I sell. Still, I am not that crazy to say or that ignorant to say that it is not the best cigar in the world.
CA: Have you noticed any change in attitude in the old guard about what the community's relationship should be with Cuba?
Boruchin: Because of the children, who have been born post-1960 and raised here, the thinking today is much more realistic. I'm not saying that the Cubans here like Castro. He's been in power for over 30 years and there's still no freedom in Cuba. Fidel knows that. He's been told by everybody. So the thinking about the government of Cuba is probably the same. But the feeling, people to people, is different. The people who live there don't have a choice to elect the government. But they're Cubans. The Cubans who live in Cuba and who live in Miami are the same. It's just a geographical situation. My feeling is that there won't be a revolution in Cuba. Everybody knows that. I don't care how conservative a Cuban is here in Miami, he knows Castro isn't going to come down by force. So the thing is to come to a political solution. Maybe it will be created by the Pope coming to Cuba. One thing we know is that people want to live better. If the embargo didn't exist and the relationship between Cuba and the United States were more normal, I think Cubans would have it easier creating a more democratic society. The isolation makes it harder.
CA: When I speak to people in the cigar trade, they all seem to hope that they can return home to Cuba someday. Do you feel there's been enough interest on the part of Cuban-Americans to help their countrymen, or is the focus on making the embargo stronger really hurting the people left in Cuba?
Boruchin: It hasn't worked. At one time they felt that it would work. Some people still feel that way. But not the younger people. You can see it in the last elections. For a Democrat to obtain more than 5 percent of the Cuban vote in Miami used to be unheard of. However, Clinton got 30 or 35 percent of that vote. I think a lot of people have changed their minds.
CA: But many Cuban-Americans still have relatives back in Cuba. They know that these people are deprived of basic necessities, which means the basic welfare of the people keeps declining. To me, it seems they have been so preoccupied with getting Castro out, that they've forgotten the people.
Boruchin: It's true, to a point. But, individually, you would be dumbfounded to find how many millions of dollars have been sent to immediate relatives. It's been food, medicine and even money. Even though it's technically prohibited this year, there is a tremendous amount of goods flowing through Canada, Mexico, the Bahamas, the Dominican Republic. It's a tremendous business and it's a tremendous amount of money. It's just not a policy.
CA: When do you think the embargo will be lifted?
Boruchin: I thought that if Castro didn't make that mistake of bringing those planes down [in February 1996], Clinton would have lifted the embargo before the elections. I think he had more to gain in votes than to lose. Many of those votes in Florida, he wasn't going to get anyway. But he is under tremendous pressure by the industry in this country, by the business community, that see Italians, Spaniards, Canadians and Englishmen who are doing a tremendous amount of business with Cuba. We are so close to the island and we can do business with Cuba.
CA: Is it a year away, two years away, five years away?
Boruchin: I think before Clinton leaves, he will lift the embargo.
CA: If the embargo is lifted...
Boruchin: I'll be in Cuba on the first plane.
CA: How will that affect the cigar market in America?
Boruchin: It would be tremendous for the cigar market. At one time, the only thing that we thought was going to help the cigar industry was the lifting of the embargo and the Cuban cigars coming into the market. Now, we have this tremendous boom, and we still have the day ahead when Cuban cigars will come into the United States. I think it would help. I think that the news media, the papers, the advertising, the charisma that is going to come in the market, together with the cigars, is going to be tremendous. Don't forget. These Cuban cigars will be at a different price level. Not everybody can afford to smoke these cigars. But a lot of people are going to try them in the beginning, and the cigars will find their niche. They'll find their niche with certain consumers. It still is not going to hurt the industry. If anything it is going to help.
CA: In your judgment, do you think the boom in cigar sales is a fad? And if so, why? And if not, why not?
Boruchin: I don't think it's a fad. I don't spend as much time on the floor taking care of customers like I used to. But the little time I spend in the store, I see these young people, 25 to 30, coming in. I see it in my family. We have a large family. I have maybe six cousins that had children. The children are all young professionals. I don't think there's one of them that doesn't own an Elie Bleu humidor. Whether they smoke two cigars a week or three cigars a week, they like to smoke cigars. If you look at a guy who is 23, 25 and is smoking and is crazy about it, even if we lose a percentage of them, you have somebody there that has 50, 60 years of smoking ahead of them. I won't see the end of this in my lifetime. Of course, everything in life reaches a ceiling. This won't be an exception. But the cigar business is going to be a tremendous business for a long time to come. I only see one danger. That's government restrictions. Before, nobody cared, but as we grow, as the industry grows, our enemies are going to grow. So, we are going to have to face in the near future a barrage of tremendous bad publicity.
CA: Hasn't that already started?
CA: There's so much disinformation about cigars; using cigarette studies to compare smoking habits of cigar smokers is one popular example. How should we fight it?
Boruchin: There's one thing they can't fight. I smoke about 10 or 12 cigars a week. I could go a month without smoking, without any problem. Cigars are not addictive. Nobody can say: "I can't live without cigars." You can be three days without smoking. You can pick up a cigar three days from now and smoke. So, the addiction that they criticize for cigarettes doesn't exist with cigars. And nobody inhales cigars; if they do it's a very small percentage. The danger of getting sick from cigar smoking is very small. They are going to have a tough time convincing the intelligent consumer of today who smokes in moderation.
CA: Do you feel that the proliferation of all the new brands on the market, some of which are not very well made or quality cigars, presents a potential problem for the industry?
Boruchin: Yes, even though I think this phase will pass. For example, look at the explosion in new tobacco stores. There're not enough cigars to go around for them. A lot of the cigars are just maybe being spread too thin. And some of those new cigars are coming in at extravagant prices. But if you look at the national brands--H. Upmann, Don Diego, Macanudo, Partagas, Bauza, Licenciados, Astral, the regular brands--they are still selling for below $5. Now you get a new cigar maker that bought tobacco last week, stole three cigar rollers and makes a cigar trying to sell it for $8 and $10. They are just ripping off the public. That's going to disappear.
CA: How would you describe, or how would you rate, the quality of these new brands?
Boruchin: Some of them are great. Some of them are garbage. Some of them are garbage in, garbage out, because they don't get the right tobacco, they don't get the right cigar makers, but they still come in to make a killing. This is not the people like us. Many people in the cigar business have been in it for 50 years. But these others just come in to get rich quick. Either they are going to try to go into the stock market and make a killing in the stock market or they are going to try to sell bad product. There is a scarcity of good product in the stores, which allows these newcomers to come in. These retailers need merchandise to sell. Eventually people will realize they are paying a tremendous amount of money for cigars that aren't worth it.
CA: You mentioned the problem with counterfeit Cubans. Is that a new phenomenon?
Boruchin: That never happened five years ago. This is happening since the Cuban cigars have become very popular, together with the cigar industry. Everybody sees it as an opportunity to make money.
CA: In terms of the counterfeit cigars in Miami, are they made in Cuba or are they knock-offs from other countries?
Boruchin: Some come from Cuba. They've been bought on the street there. But the majority are made in the Dominican Republic and Honduras.
CA: And the consumer doesn't know?
Boruchin: Don't forget that most of the young smokers have not been exposed to many Cuban cigars. They buy a box of Cohibas and they smoke a product that is not that great, but they really don't identify it that well. Like maybe you or I could identify it as a fake.
CA: Then they say a Cuban cigar is not so good.
Boruchin: But they like to go around with the band on. What they are trying to do is impress people with the fact they are smoking a Cohiba. Taste means very little. It's just showing off to their friends on Saturday night that they are smoking a Cohiba. They choose by the band.
CA: I get asked all the time by people to tell them whether the cigars are real or not. One guy swore his came from Cuba, and I asked him if they'd been bought in a store and he said, no, right out front. I knew immediately they were fakes. It seems the problem is out of control.
Boruchin: Every other Cuban cigar sold in Miami today is counterfeit. Especially the Cohiba and Montecristo labels. Those are the ones that you see the most. I haven't seen a counterfeit Bolivar, or some of the other brands that are not that popular. I have heard stories of customers of mine that have been hustled by clerks in stores in Cuba, like, "Why do you want to pay $250 [per box] for this cigar? I can get it to you for $70, $80 tonight, if you meet me at such and such a place." Because it's a store clerk offering this deal, people think they must be stolen from the store and are real. But that's not the case. The Cubans are very ingenious. They always were and that's the reason that they're so successful in exile. How they manage to counterfeit the boxes and the bands--this is something unbelievable.
CA: You have three brands today. Can you tell us the origin of the brands?
Boruchin: The 8-9-8 Collection came about as a result of a  deal with General Cigar. We were going to do something in the Dominican Republic. They wanted to make a good high-grade cigar for us in Jamaica. Today, because of the raw material problems, we will get about 300,000 8-9-8 cigars.
CA: You own that brand?
Boruchin: I own that brand, and it is selling tremendously. We have taken orders [at the August '96 Retail Tobacco Dealers Convention] in Cincinnati for delivery in '97. Even though we are going to deliver 300,000 cigars, you know that is not enough. And, it is a very expensive cigar.
CA: What's the price range of 8-9-8?
Boruchin: Between $6 and $9. We also own the brand, Licenciados, which I started to make with MATASA and Manuel Quesada in 1987. I wanted a mild cigar because the market favored mild cigars at the time. I was smoking Diplomaticos that I used to get in the Bahamas. And I loved the look of the box and it occurred to me that it wasn't registered. I tried to register the brand, but I ran into problems with the name. But I had no problems with the design. In order to expedite the introduction, we came out with the name Licenciados, which means attorney in [Spanish]. We had some second thoughts because the name was so hard to pronounce in the American market. But then we got a 93 from Cigar Aficionado [in 1994], and the brand became extremely popular; the pronunciation didn't matter.
CA: They could pronounce Toro. [Laughter] [Toro is the name of the Licenciados corona gorda that received the 93.]
Boruchin: They could pronounce Toro with the 93. The problem was essentially a very recent problem. We were great in the late '80s, over 200,000 cigars a year. We had 40 or 50 good friends that we had in the cigar business that were helping me with the brand and the brand was a viable brand.
CA: So you created the name?
Boruchin: I created the name. And Mr. Quesada and myself created the brand. We were trying to copy a blend similar to Macanudo. I don't mind telling you. Macanudo was extremely popular and we felt that if we came out with a product mild like this, we would have an edge.
CA: With Licenciados, because it was not a brand of Cuban origin, you can sell that brand all over the world.
Boruchin: The brand, yes. I don't think I can use the design outside the United States, because Cuba makes Diplomaticos with the design.
CA: What is the sales volume for Licenciados?
Boruchin: In 1996, we will have put out in the market a little over one million cigars. We could sell more if we could get them.
CA: What about Bauza?
Boruchin: Bauza is the love of my life. That was the first cigar I smoked. It's a very old Cuban brand and it's probably one of the most popular Cuban brands that wasn't made for export. It was smoked by Cubans on the island. The brand Bauza is owned by the Arturo Fuente family. I acquired the distribution rights to the brand when I purchased a small jobber that represented the Fuentes in the Miami area.
CA: You acquired the rights to sell the brand?
Boruchin: I have the rights to sell the brand in the United States. It's a tremendous brand. I know that Carlos Fuente Sr. and Carlos Jr. are in love with the brand. The plans for the brand in the future are tremendous.
CA: The Fuentes produce the brand?
Boruchin: Yes, they make the brand. When I acquired the rights for the brand, we were selling maybe 40,000 or 50,000 cigars in the United States, but they were mainly concentrated in the Cuban area in Miami. But they weren't making any money because the Cubans in Miami only buy very inexpensive cigars. So, we went national with the brand.
CA: What year was this?
Boruchin: It was 1990 when we acquired this company together with this brand. We also had the rights to sell the brand Moya, which is also a very old Cuban brand and also owned by the Fuente family. Moya was not as popular [as Bauza]. We had plans a few years ago before the cigar revolution--we were going to make a line of short-filler cigars with this name. But the Fuentes, of course, are so tied up in work right now that we have delayed the Moya project. We feel very strongly that in the near future Bauza is going to become a bigger brand.
CA: Between MATASA for Licenciados and A. Fuente for Bauza, what kind of production increases do you think you'll get in 1997, '98 and '99?
Boruchin: I feel strongly that we can grow at a rate of 25 to 30 percent a year in the next few years. It depends on the effort of MATASA and Fuente to expand their production capacity. And it depends on what happens with the demand of the other products. Don't forget that the Fuentes are the most sought-after cigar. The Fuente Fuente Opus X is today probably the most in-demand cigar in America. The Arturo Fuente brand is so popular that no matter how many cigars you get, they sell out within two to three days. They have a long way to go, but the effort being done to catch up is tremendous. I feel pretty optimistic about the future when it comes to getting more products from them.
CA: Is your family in the business now?
Boruchin: Yes. I have my son-in-law [Oded Ben-arie] in the business. He is second in command. He does a tremendous job. I am not there as much as I used to be. A friend of mine makes a Big Smoke every month. I'm absent three, four days a month just for that, and for trips to the Dominican Republic and Honduras. So, I'm away and he's always there and he runs the business now.
CA: Is Mike still in business?
Boruchin: Mike is still in the business.
CA: How old is he today?
Boruchin: Mike was born 1/11/11, so, he is 86. At one point, when he sold us the business, he retired. He came back about six months later; he asked me if he could come back to work a few hours a day, and, of course, for me it was a blessing. He watches my back. As long as Mike is there, nobody is going to stab me in the back. He's like a bodyguard always. Today, he puts in eight, nine, 10 hours a day.
CA: Why is it that whenever I go there, he gives me white gym socks?
Boruchin: You know Mike started out on Orchard Street in New York and he had a pushcart, and he was always there selling socks. He always says that he blesses the memory of [then-New York City Mayor Fiorello] La Guardia, because La Guardia kicked him out of Orchard Street with the pushcart and he had to move to Florida. And he started the cigar business. So, the love of his life has always been socks. So as not to forget that, he keeps a little stock of socks in his desk and everybody that he likes that comes to the store walks out with a pair of socks.
CA: Your store is one of the most beautiful stores in America. Do you have any plans to expand that one store or to add other stores? Either in Florida or elsewhere?
Boruchin: We have 6,500 square feet of retail store. The retail area is adequate. And even if we pile up more stuff in the store, it is adequate. Where we run out of space is in the warehouse, the wholesale and other department operations. We are looking into expanding that area. We are looking within the neighborhood where we are located right now. I have no plans to expand the store. We walk a thin line between being manufacturer, distributor and retailer. If I open up a lot of my cigar stores around the country, I would be competing with my friends. We are not planning to enlarge the retail operation.
CA: What do today's smokers buy? What are they smoking? What are the cigars that are in big demand in terms of flavor, strength, size, color, origin? What is the cigar that is in greatest demand?
Boruchin: The trend today is toward a strong cigar. Size favorites are robustos, a 4 1/2 or 5 [inch] x 50 ring gauge or a 5 1/2 x 50 ring gauge. On many occasions, you can't smoke a large cigar unless you find a friendly place or in your house. Most of the places you want a shorter smoke because you want to finish and you don't want to throw it away. When a new smoker walks in, the preference is for a mild cigar. But he graduates to a medium to strong cigar very quickly. I see them come in the first day and buy cigars. But then you see them a month later and they already are looking at a little stronger cigar, such as a Partagas, a Fuente, a Bauza. At the beginning, they all feel they want to start with a mild cigar. But it is surprising how they move pretty quickly to a strong smoke.
CA: How much do they want to spend on a cigar?
Boruchin: Price is no object. When you see that some of the retailers come to my place and pay full price and then go out to sell it at a tremendous profit, it means people are going in those places and buying cigars for $10, $9, $8 apiece. I think availability is the main issue today. If you have the product, you have no problem charging whatever you want.
CA: In south Florida, are there today many places where you can go and enjoy a nice meal and have a cigar afterwards? Or are there still a lot of problems in terms of having a place to eat and then smoke?
Boruchin: You still have a lot of problems. There're not too many places that you can go openly and light up a cigar where you're sitting. They allow you to smoke in the bar, in many cases. But, a lot of clubs are opening up, even though I don't count clubs. I like restaurants, where you can sit down and enjoy a cigar. One of them is The Forge, especially since they opened up the Cuba Club next door. But they keep humidors with cigars in both places. And you can light up a cigar any place in The Forge. It might be another half dozen restaurants like that. But that's all.
CA: Do you see any local legislation coming along to restrict cigar smoking in south Florida?
Boruchin: They have tried. But Florida is a big producer of cigars, and we've been able to stop those efforts before. However, I won't be surprised if it will happen in the future. Not too long ago [the state] tried to pass a tax on cigars and it was defeated. They just passed a tax on tobacco, but they never touch the cigars. In Tampa and Miami, a lot of people still make a living in the industry.
CA: You once told me a story about the brand name Cohiba and the trademark. Could you tell it again?
Boruchin: In the '70s, a friend of mine, Bernardo Benes, was retained by the Carter Administration. Bernardo had been a friend of Fidel in Havana University and at the beginning of the Revolution, he was a subsecretary in the Treasury Department. He left Cuba because of ideological differences. But he is not a conservative Cuban. He worked closely with Claude Pepper when he was a congressman, and he was on retainer with the State Department during the Carter Administration. He used to go and see Castro often, always on different missions that didn't really come out in the press. One time he came back from Cuba and he gave me a little pack with four or five lanceros. And he told me these are cigars that Fidel smokes that he gives to people that visit with him. The cigar is not a commercial brand. At that time, they didn't ever dream that they were going to make it commercial. I was working for General Cigar at that time and, loyal employee that I was, I sent the bands and a couple of cigars to Edgar Cullman Jr. And I told the Cullmans the story that I just told you. And General went ahead and registered the brand. And sure enough, nobody had an intent to register it then because the brand wasn't even commercially available. So, General Cigar owns the brand in the United States.
CA: You've been in the cigar trade for 36 years. Do you ever look in the mirror and pinch yourself?
Boruchin: Yes. But, I can't tell you the number of times that I considered leaving the business. The only problem with cigars is that it gets into your skin. The cigar business, you just couldn't leave it. You get to love the business so much and the people in the business. I bet you that there's not another industry that has the friendships that I have. I say that because lately, like any industry that grows so much, it creates jealousies and creates competition. But I remember at one time that we all sat down and talked about our mutual business--it was like a big family. It still is. And, I'm very glad I didn't leave, because the last four or five years have been very rewarding.
CA: I think I know what you are talking about. Many of the new people have come into the business to exploit it, as opposed to because they love cigars or they have a family history in the business. They would probably leave it if it stopped growing. Many are only in it for the money. They are not in it for the emotional bond that many of the people that have been in it their whole lives are in it for.
Boruchin: It's a funny thing. We have a community. It's like an association of the people who've been in this business a long time, and we look out for each other. I don't mind telling you openly, when it comes to distributing my cigars, which are so short in supply, I never forget the people that helped me whenthis craziness wasn't around. My supplies go to those 100 or 150 stores that weathered the storm. You will never find one of the old guys without cigars as long as I am around. I will take care of the people that have been around a long time. This is my philosophy.
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