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Cigarillos: Short and Small

In Europe, the Cigarillo, or Short, Dry-Cured Cigar, Sells. In America, it Has Never Caught On.
Patrick Oster
From the Print Edition:
George Burns, Winter 94/95

(continued from page 1)

Nobel cigars, famous for their turn-of-the-century-style turquoise cigarillo package, set the early quality standard for the product. As a result, smokers came to expect the best cigarillos be packed in similar hard-edged carton boxes, wrapped in cellophane. But Dannemann, SEITA (the former French monopoly) and other manufacturers, eschewing total me-tooism, offer some of their leading brands in steel "tins," which they tout as better protection against crushing. The Dutch firm AGIO goes yet another way, offering its top-of-the-line small cigars, Balmorals, in cedar boxes, promising an enhanced cigar aroma because of the impact of the fragrance of such wood on tobacco.

For its first 50 years or so, the cigarillo did not exactly set the cigar world on fire. Hand-rolling, required by law in Europe until the 1950s in some countries, limited production levels and company sizes. Sales efforts were focused on national markets, a reflection of the localized nature of smokers' tastes in Europe. Exports were a minor interest and did not become financially interesting until the advent of mass production in the 1950s. Thereafter, unit production soared, mostly in Europe, where most companies sell 90 percent of their cigarillos. Key export markets for this European invention are Japan, Hong Kong, Australia and South Africa. Despite the size of the huge U.S. market, though, sales have been unspectacular, typically constituting only 1 percent of global totals for most firms.

Sales spiked nicely for a while. But then two very different forces slowed momentum. In the 1960s and 1970s, cash-rich cigarette companies, even more mechanized than cigarillo firms, poured millions into aggressive ad campaigns to attract new smokers. Low-profit, lower-volume cigar firms, which typically make both full-sized cigars and cigarillos, didn't have the cash to match them and saw new-customer numbers shrink as a result. And in the 1980s, the public's growing health concerns about any kind of smoking hit critical mass. That reduced the global smokers' pie, over which cigarette and cigar manufacturers had been fighting.

Once proud cigar companies began hemorrhaging red ink. Some went bankrupt. Others were bought out the way Burger's company acquired the venerable Dutch firm, Ritmeester Cigars, in 1988. "There used to be 300 cigar factories in Germany in 1950," says Friedhelm Franke, managing director of Dannemann's Lübeck factory. "Now there are about 10."

In fact, just a handful of companies besides Dannemann--all European--dominated the cigarillo market, including the Netherlands' EBAS International (Lapaz Mini Wilde, Wilde Havana), France's SEITA (Fleur de Savane, Havanitos), Winterman's (Café Crème, Café Crème Mild) and Nobel Cigars (Nobel Petit, Christian of Denmark). Even prestigious Davidoff International finds it financially smarter to farm out manufacture of its famous "mini cigarillos" to Nobel.

It has not been a totally downhill affair for cigarillo makers. In fact, recent history is rather bright. Their clientele, 99 percent male and mostly more than 40 years of age, is increasingly composed of bankers, lawyers, executives and others with above-average incomes. And while cigar smokers have been declining worldwide, cigarillo sales have been on the rise as much as 10 percent in key markets.

Likewise, despite the slippage of manufacturing quality at some firms during the turmoil of the restructuring 1980s, cigarillo executives, having gotten an angry message from veteran customers, instituted groundbreaking quality-control reform programs at the beginning of the 1990s and are now enjoying their fruits. "Smokers have a taste in their heads," explains Burger of the urgency to be more professional in manufacturing. "If we don't match that taste, our customers are going to be disappointed and go elsewhere," adds Erik Pedersen, vice president of Denmark's Nobel cigars. "If you smoke every day, you become very sensitive to taste differences."

At Dannemann, which claims to be the cigarillo volume leader, quality begins before the tobacco plant is even planted. Primary growing areas for its filler, binders and wrappers are Brazil and Indonesia, as they are for many cigarillo makers. In both sites, the quality process starts with a rigorous choice of tobacco seed from plants that reflect the company's particular needs for flexibility, aroma, taste and other key factors. Farmers, once the pawns of middlemen, are dealt with directly under the new program. They are advised on what fertilizer to use (to avoid the harsh taste that too much phosphate or chlorine can produce), how to cut ripe plants (whole plant versus leaf at a time) and how to air cure the resulting harvest. The right quality of plant produces a good price, so cooperation has become enthusiastic, a far cry from the old take-it-or-leave-it bargaining process.

Characteristics of soil and weather, of course, are beyond quality-control management. But even here, cigarillo makers compete to lock up that perfect microclimate for tobacco, the same way enophiles pay top dollar for vineyards in Bordeaux or Napa Valley. For the dark-brown, mild wrappers it uses for its Smoker's Club or Speciale (Brazil) models, Dannemann prefers tobacco grown in the light-colored sandy soil of the humid, high-altitude Mata Fina district of Brazil's Bahia state. Sumatra's tobacco plants are coveted by Nobel for its stronger, tan ("cream") wrappers that characterize its Petits.

All cigarillo firms buy tobacco from around the world to create that secret filler blend that they hope will be judged better than all others. Dominican or Colombian, Cameroon or Turkish, German or Connecticut--there's seemingly a cigarillo blend for any taste.

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