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An Interview with Stanford Newman

Chairman, J.C. Newman Cigar Co., Tampa, Florida, the owners of Cuesta-Rey and Diamond Crown cigars.
Marvin R. Shanken
From the Print Edition:
Claudia Schiffer, Jul/Aug 97

(continued from page 6)

CA: In 1997...
Newman: We won't be shipping any more [than 1996]. We hope to ship the same.

CA: So, in other words, are you saying that for the near future...
Newman: We hope to be back to about 150,000 a year and more. But it's very difficult down in the Dominican Republic because they're stealing our people. They're paying $15,000 Dominican, as much as $1,500 American, to try to steal the better cigarmakers from the Fuentes. I think they've lost 90 workers this year. It's difficult.

CA: Is there a plan to ever get this to a million?
Newman: Oh yes, yes. There will be a plan once this situation settles down. This may be another two or three years. The Fuentes are training people, but the whole situation, I think, is difficult.

CA: Do you have tobacco set aside?
Newman: We certainly do. Not millions, but we have tobacco aging for the Diamond Crown.

CA: Can you get up to a half a million?
Newman: Maybe eventually to half a million, but I don't think we'll do any more than that. It may take two or three years. And the plans were that we were going to sell the Diamond Crown on the West Coast and come east, and a Fuente Fuente Opus X was going to go from the east to the west. The Fuente Fuente Opus X--I think they're only sold up to the Mississippi River today, although they're probably black-marketed all over.

CA: How do you build a business that's so strapped from a production side? What goes through your mind?
Newman: Well, my way of thinking is that the Fuentes are the best manufacturers by far, and have the best value of any cigar manufacturer in existence because of the way they make their cigars, and the way they run their [business]. They don't have anything that's fancy; their overhead is very low. And they're so good because they live there. And the theory goes back to when I used to go to Cuba; I used to know that the best tobacco was kept in Cuba by the Cuban manufacturers.

CA: How old are you now?
Newman: I'm 80.

CA: Eighty years old! You spent your whole life in the business. You've seen the rises and the declines and the most recent resurrection, if you will. Things have never been so good. You have your kids in the business today. But you can't get enough product to really allow your business to rise to the level that the market wants. Is this very frustrating to you?
Newman: It is, but we're hoping that it will alleviate itself. I think in time--it may take a year or two--it will alleviate itself, because I think this competition for tobacco, the competition for labor will stabilize sometime. It will certainly be more stable on the popular brands. But it will not stabilize for the new brands, which are destabilizing the market very bad down there. They're paying a lot of money for tobacco, and they're paying for tobacco that some of it is good, but some of it's very new, very green. They say that when they go out to sell the cigars, it's young tobacco. I think a lot of these things will level off.

In the meantime, the Fuentes are building a fifth factory. They have one factory that has, I think, 200 or 300 learners [apprentices] in there. The other people in the businessæGeneral Cigar, has a similar amount of learners, Consolidated has learners. And, I think if the main brands become more plentiful, it will stabilize the whole industry. But, as I say, it is frustrating right now. But, I'm real happy to see that in the computer in our factory, for our distribution system, that we sell to 2,000 or 2,500 retailers, and every time we get a shipment in from the D.R., they get some cigars.

CA: What made you go into the humidor business? What was the thinking behind that?
Newman: We have bought and purchased from Reed & Barton over the years, humidors that we put in 20,000 restaurants. We had our better sizes of our Cuesta-Rey [cigars], our numbers 1s, 2s and 3s, the more expensive ones. [Selling cigars to restaurants] was one of the ways we marketed them. And we had them make humidors so we could give them to the restaurants. But for the past two or three years, we had lost most of our restaurant buiness because the owners often couldn't sell cigars in the restaurants. We hadn't done very much business with them recently. About two years ago Reed & Barton said to us they were beginning to get requests for humidors from jewelry stores and department stores. They wanted to know if they started to sell humidors, whether we would go into the business [distributing them]. And, at that time, I, and Eric and Bobby, conducted some surveys and talked to a lot of retailers: "If we had humidors, would you buy them?" They'd be made by Reed & Barton. "Oh, of course we would, because when we place orders with people from this country, from Italy, from Spain, we don't get the humidors. We place them at the RTDA [Retail Tobacoo Dealers of America convention] in July or August, and they come in in January or February." I got the idea that we would keep the inventory, and if people wanted to buy one, or if they wanted to buy 10, that it would be a very good idea. And we've been very successful because Reed & Barton goes back to 1824. They've made jewelry cases and cases for their silverware.

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Comments   1 comment(s)

Clifford Brown — independence, ky, usa,  —  May 14, 2013 3:47pm ET

That is a truly amazing article!

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