Richard L. DiMeola

Executive Vice President, Chief Operating Officer, Consolidated Cigar Corporation

(continued from page 7)

DiMeola: Honduras and Mexico.

CA: So the Dominican Republic factory produces a small portion of your bundle business?

DiMeola: That's correct. And we would like to produce an even smaller amount there.

CA: Jamaica. You've said to me that you are either planning to, or are in the process of, reopening or opening a factory in Jamaica for the production of Royal Jamaica. Can you talk a little bit about that project?

DiMeola: We're in the process of that project now. We would like to open a factory in Jamaica. We would like to move the production of Royal Jamaica to Jamaica for a number of reasons. One important reason is we then relieve La Romana. Another reason is that we think the story that can be told about bringing Royal Jamaica back to Jamaica is an interesting one--the fact that Jamaican authorities are looking on this as if they have found a long-lost national treasure.

CA: Is there any Jamaican tobacco that goes into it?

DiMeola: Absolutely. There always has been.

CA: In the filler? The binder?

DiMeola: Filler.

CA: What percentage of it might be...

DiMeola: The vast majority. It's a majority.

CA: Is it a fact that it's going to happen?

DiMeola: It's not a fact. It's still in negotiations.

CA: And you hope to resolve that negotiation in the coming months?

DiMeola: We hope to resolve it in the coming weeks. It won't be totally resolved, but we're getting close. [Weeks after the interview, DiMeola informed Cigar Aficionado that the first cigars would come out of Consolidated's Jamaican plant in June.]

CA: Assuming it is, is there a factory that is already built?

DiMeola: There are buildings.

CA: There are buildings? The original buildings?

DiMeola: No.

CA: What about the workers?

DiMeola: We would have to hire workers.

CA: And train them?

DiMeola: We think that we can attract a small core of trained workers who, perhaps at one time, worked in the old Royal Jamaica factory. So from that we would have to build. It would be a slow building process.

CA: Could you compare the new smoker in the market today with the consumer of five years ago?

DiMeola: He's younger. The average age of entry into smoking cigars used to be 35. Today it's lower. I don't know what it is; we haven't done the research. That smoker today is smoking better and fewer. I mean, I don't want to use a cliché, but I think that's a fact. The younger smoker is smoking fewer cigars, but he's smoking better cigars. There are consumers now who won't buy a cigar unless it costs them more than $5. I speak at some of these dinners and the subject of price comes up and I tell that to the audience: There are people among you who won't buy a cigar unless it costs you more than $5.

CA: Image.

DiMeola: Image. So we need to bring $5 cigars to them.

CA: Are the questions that they're asking changing?

DiMeola: Yeah, sure. They're becoming more sophisticated. They're being educated by Cigar Aficionado . They are being educated at these dinners. You no longer get the questions, "How do you cut a cigar?" "How do you light a cigar?" They want to know how it's made. They want to know where the tobacco comes from. They want to know the same questions you're asking about Cuba. They want to know about Cuban cigars--"Are Cuban cigars really the best in the world?" You get stories from them about "I went out and tried a Cuban cigar, and I didn't like it." And the answer to that is that everybody has their own taste and everybody has their own preferences. Try the Cuban cigar, see if you like it. Even though--remember it's illegal--except [outside the United States].

CA: Do you think that all the recent publicity regarding women cigar smokers is hype and P.R., or do you really see a significant market evolving?

DiMeola: If you asked me that question two years ago, I would have said there's absolutely no way that anybody can build a market in cigars selling to women. And now, here I am creating a couple of new shapes we're calling Cleopatra, designed for women.

CA: Tell me about Cleopatra.

DiMeola: Well, I don't want to tell you what it is because it's not on the market yet, and I don't want to educate anybody to that extent.

CA: Well, is it going to be on the market soon?

DiMeola: I hope so.

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