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Swisher International Group Inc. Switches Gears

With three factories in two countries and a growing roster of brands, Swisher's investment in handmade cigars definitely isn't too little. But is it too late?
Brendan Vaughan
From the Print Edition:
Gina Gershon, Sep/Oct 98

(continued from page 2)

At this, he lets fly a deep belly laugh and opens the door to the rolling gallery. Quesada is one of the strongest personalities in the Dominican cigar business. A tall, powerfully built man of 51, he founded Matasa (Manufactures de Tabacos S.A., his first factory) in 1974 with "one table and six cigarmakers." Even today, with an annual capacity of 15 million cigars, the ramshackle Matasa is the polar opposite of Cotabex. "This factory came from a blueprint," says Quesada. "We were able to sit down and plan and program the factory so it has a flow."

Flow it definitely has. Though the plant was making only about 26,000 cigars a day in March (a pace of 6.2 million cigars per year, well below its maximum capacity of about 35 million), Cotabex is highly efficient. Tobacco is received at a large loading dock, sent via elevator to a second-floor mezzanine for sorting, bulking and fermentation, then brought back downstairs to a large, well-ventilated rolling room.

Once the cigars are rolled, they're taken to zinc-lined rooms for fumigation, cedar-lined rooms for aging, and air-conditioned rooms for packing. The reception and executive suites could be in an office park in suburban Phoenix. There's even a personnel director with an office directly off the rolling gallery. Workers with a question or a gripe can stop by anytime.

Quesada's first project for Swisher is Optimo Classico, a premium bundle cigar that was introduced in mid-April and sells in the $2 to $3 range. Optimo, which Swisher acquired in 1986 when it bought Clearwater, Florida-based Universal Cigar Co., is a machine-made cigar that sells for about 60 to 80 cents apiece. The bundle is an attempt "to capitalize on the famous name of Optimo," says Ryan.

"Matasa's main role in this setup is to run the operation according to the wishes of the partners," Quesada says. "Julio [Fajardo, his right-hand man] and I run the factory. The expertise that CITA and Swisher bring is a different area of expertise; they bring the market area that we don't have, and CITA brings Europe, which we don't have. So we've sort of gathered the three strong points of each and put them together to create Cotabex. And we hope we'll benefit from the joint work of all three."

Swisher's Jacksonville corporate headquarters and plant occupy about 750,000 square feet. The factory itself is an impressive monument to the science of manufacturing. About 1,000 workers toil here, performing what amounts to support roles for the hundreds of highly automated machines that purr and whine ceaselessly.

Surrounding the compound are somnolent streets lined with exquisite old houses in the latter stages of decay. Save for the Swisher plant, the atmosphere borders on antebellum. "This isn't Florida yet," notes Mann, who grew up in Mountain Lakes, New Jersey. "It's south Georgia. Florida doesn't start for a few miles south of Jacksonville."

Settling into Mann's office to talk about Swisher's future and past, Mann's the only officer wearing a tie, and that's for an anticipated photo shoot. The executive suites are almost as casual as the factory floor.

Founded in 1861 by a Newark, Ohio, merchant named David Swisher, Swisher is one of the oldest cigar companies in America. There are several versions of how it wound up in Jacksonville, but the most common tale has the then-mayor befriending Carl Swisher, David's grandson, as he was passing through Jacksonville and "selling" him the city with a weekend of heavy entertaining. Another version claims Carl was attracted by the fishing.

Whatever the reason, the company moved to Jacksonville in the early 1920s, and by the end of the decade was making 100 million cigars a year. Then called Jno. H. Swisher & Son, the manufacturer prospered as cigars enjoyed immense popularity over the next several decades.

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