Cigar Industry

100 Years of Retailing

| By Shandana A. Durrani | From Linda Evangelista, Autumn 95

The year is 1895. Grover Cleveland is in his labor-troubled second term as president. Cuba battles Spain for autonomy. The Lumière brothers make the first movie. Katie Ruth gives birth to the legendary slugger, Babe. And Demuth's Tobacco Shop in Lancaster, Pennsylvania, celebrates its 125th birthday.

Now 225 years old, Demuth's can attest to the power of perseverance. But nine additional establishments claim rich histories that date back a century or more. These cigar stores--Iwan Ries & Co. (Chicago), David P. Ehrlich Co. (Boston), L.J. Peretti Company, Inc. (Boston), Straus Tobacconist (Cincinnati), Leavitt & Peirce (Cambridge, Massachusetts), W. Curtis Draper Tobacconist (Washington, D.C.), Fader's (Baltimore), Rich's Cigar Store Inc. (Portland, Oregon) and Rubovits Cigars (Chicago)--have withstood the test of time, surviving both natural and man-made disasters. From citywide fires to the first and second world wars, from the Great Depression to the Cuban embargo to the current public intolerance for smokers, these stores are a testament to the American Dream that hard work, long hours and faith, with a little luck sprinkled in, will pay off in the long run.

Few of the stores that existed in the early years of U.S. history have survived the ravages of time. Many closed during the tumultuous times of the Depression and Second World War. Others didn't survive the aftershocks of the Cuban embargo. Many of those that closed couldn't withstand the industry's ups and mostly downs of the past 30 years. But these 10 establishments are unique. They successfully faced the challenges that lay in their paths and are poised to take on the future.

* * *

Demuth's Tobacco Shop, Lancaster, Pennsylvania
Established 1770

"Because of our age, people from all over the world know about us and visit us." -Wally Vail, 78, cigar buyer

The oldest continuously operating tobacco store in the United States is Demuth's Tobacco Shop. Six years before our forefathers signed the Declaration of Independence, Christopher Demuth opened his smoke shop. Since 1770, Demuth's has provided tobacco products as well as humidors, cutters and cigar cases for the Lancaster community. Gen. Edward Hand, one of George Washington's right-hand men, purchased snuff here. Jasper Yeates, a leading American patriot, was a regular customer. And President James Buchanan was spotted at the shop buying Demuth Golden Lion cigars, according to Carol Morgan, director of the Demuth Foundation, the not-for-profit organization that now owns the shop, factory and former homes of the Demuth family.

"The Demuths were very successful businessmen," Morgan claims. "The tobacco shop served as the hub of many social contacts by businessmen in the community. They exchanged news, kept weather reports and stopped in there for their snuff, tobacco and cigars."

The shop has passed through five generations of Demuths, all in a direct line of descent. Christopher Demuth's son, Jacob, took over and later bequeathed it to his heirs, who did the same for their own offspring, until the last male Demuth, Christopher, who owned the store from 1937 until his death in 1976, left it to his wife Dorothea. It was Dorothea who, caring for shop and the family name as much as she did, sold it to The Demuth Foundation in 1986 instead of selling to an independent buyer. She wanted the shop to last. And last it has.

Demuth's carries a wide array of handmade and machine-made cigars for its customers. The store serves customers looking to spend anywhere from 50 cents to $10 for a cigar. And with the popularity of handmade premium cigars still on the rise, the store is withstanding the efforts of the antismoking brigade.

"Cigars are not going to kill," states Wally Vail, a cigar buyer for the store. "People don't understand that you can go down into the hills of Kentucky and Tennessee--Appalachia--and see 80 or 90 year olds who are still smoking corncob pipes. And they were born with them in their mouths!"

Even with fewer places to strike a match, Demuth's future looks bright, says Vail. He believes that the popularity of cigars will continue to grow and that the store will survive. "If there are any large changes in the tobacco industry whereby the store cannot continue to break even," Vail says, "it will continue to sell tobacco products; but it basically would be a museum."

* * *

Iwan Ries & Company, Chicago
Established 1857

"We still run our business the same way we did 100 years ago." -Chuck Levi, 58, owner

In 1857, Edward Hoffman dreamed of establishing a cigar store in Chicago. That year, he opened the oldest tobacco shop in the Midwest, E. Hoffman & Co., later enlisting the help of his German cousin, Iwan Ries. Now, 138 years later, Ries' grandson, Chuck Levi, owns the same tobacco shop. It has borne the name Iwan Ries & Co. since 1898, when Ries gained control of the shop after Hoffman passed away.

Levi's father, Stanley, 89, married Ries's daughter in the early 1930s, and took over after Ries died in the late 1940s. It truly became a family business when Chuck entered the operation in the late '50s. Now, his son, Kevin, 25, also works at the store. But Levi is quick to point out that, although the store has managed to survive more than 100 years of changes in the tobacco industry and technology, it is basically the same store it was at its inception.

"We have modernized our marketing and merchandising," Levi says. "But we still run our business the same way we did 100 years ago. My grandfather and father always ran the business with a couple of things in mind: Service is number one and selection of merchandise is number two."

The store prides itself on its vast selection of tobacco products and accessories, according to Levi. He claims that his store carries the largest selection of pipes in the country and about 80 different brands of cigars.

Levi clearly loves the business. The store has never been in jeopardy of closing; Levi attributes this to luck and sticking to the maxim that one must take care of the customer's wants and needs, regardless of how much money he (or she) has to spend.

And as the cigar business evolves, Levi believes that the popularity of premium, hand-rolled cigars will continue to grow. But in order to succeed, says Levi, one must stay ahead of the trends, which is difficult. "Don't get lost in the shuffle, get so wrapped up in the success of today that you can't plan for tomorrow," he warns. "We are not here to make a killing this month and two or three years from now be out of business."

* * *

L.J. Peretti Company, Inc., Boston
Established 1870

"We try to be a smoker's haven." -Robert Peretti, 74, owner

Boston is known for its landmarks. But one site that is not in the history books is located on Park Square. L.J. Peretti Company, Inc., a family-run operation, has served the Boston community for more than 120 years. Famous smokers such as Edward G. Robinson, Red Auerbach, Winston Churchill and Bing Crosby have purchased goods there.

In 1870, Libero Joseph Peretti, a cigar maker, decided to open a cigar establishment in which he would not only make the smokes, but sell them as well. From its humble beginnings in a loft, Peretti's Cuban Cigar Store eventually expanded to include two more stores. But changes lay ahead.

In 1921, Libero's son, Joseph, took control of the store after the elder Peretti passed on. Joseph had always been interested in cigars but decided to expand the business to include another love of his: blending tobacco. This enabled him to broaden the shop's offerings from solely cigars to cigars and pipes.

The cigar business was booming in the 1920s, and the Perettis had a number of Cuban cigar makers in their shops. They even set up a shop in New York City to help make cigars. But when the Depression hit, business would never be the same.

Robert Peretti, the founder's grandson, became involved in the business after he returned from service in the Second World War. At this time, Peretti's only had two remaining stores. Then, in 1947, Boston ran a turnpike through the store on Boylston Street, and Joseph Peretti retired. Robert was left in charge of the last store.

One of Robert's greatest challenges was surviving the effects of the Cuban embargo. But the business endured. "I think it was a great challenge for the cigar makers both in this country and the Caribbean," Peretti says. "And the transition there [from Cuban tobacco to other sources] was very difficult. This gave a chance for the whole Caribbean area to invest in developing seeds, improving the soil and the way of growing the tobacco. The quality product they are producing now is really superior."

Peretti's offers smokers more than 100 different cigar brands. Customers can also choose from a wide assortment of humidors, cutters and cigar cases, all of which are hot sellers, according to Peretti. And now that business is booming, with no end in sight, Peretti has other mountains to climb. On June 19, Peretti's celebrated its 125th birthday at the Boston Harbor Hotel. It observed the occasion by introducing a special smoke, the Peretti's Anniversary Cigar. All of this when public intolerance for smokers is on the rise.

"Public opinion has certainly been against smoking. In that sense we have certainly felt pressure," Peretti says. "But the question is: How do you position yourself so that you still maintain the leadership that you have had over the years?" If past history is any indication, Peretti will find a way.

* * *

David P. Ehrlich Co., Boston and Leavitt & Peirce, Cambridge
Established 1868 and 1886

"I think there is a certain allegiance to old-time stores that treat you well." -Paul Macdonald Sr., 64, owner

The Boston area has two additional historic cigar establishments: David P. Ehrlich Co., the third oldest in the nation, and Leavitt & Peirce, a shop overflowing with Harvard memorabilia. Both stores are currently under the management of the Macdonald family, but each has its own rich past.

Ehrlich's is one of the few old cigar stores that was founded by a woman. Fanny Abrahams, a German immigrant and mother of two, left her homeland for Boston to start a tobacco shop with her husband. But fate dealt her a cruel blow when her husband died before leaving Germany to join her in the States. Alone and bereft, the widow nonetheless fulfilled her dream and opened the F. Abrahams tobacco store in 1868 at 1133 Washington Street.

Fate also played a role in the arrival of the Ehrlichs. In 1872, the great fire of Boston destroyed many blocks of the city. David Ehrlich and his father owned a jewelry shop that burned down during this fire, according to owner Paul Macdonald Sr. The younger Ehrlich found work at the Abrahams tobacco shop. Later, he married into the family, and from approximately 1900 on, the shop was known as David P. Ehrlich Co.

Ehrlich had no children himself, and after he passed away in 1946 he left the store to eight of his cousins who were in the glove business. The Macdonalds bought the store in 1978 after the descendants of the Ehrlich family, for lack of interest, decided to sell.

"In 1914, they [the Ehrlich cousins] owned a company called Touraine Gloves," says Macdonald. "They had two young boys working for them, and the story goes they [the boys] always talked about going west and making their fortune. The two young guys turned out to be Samuel Goldwyn and Louis B. Mayer."

The shop has been a major provider of pipes for the Boston community, even going so far as installing a pipe maker on premises. But due to the popularity of cigars, it is now predominantly a cigar store, according to Macdonald. In fact, the store carries 30 premium cigar brands as well as the usual array of cutters, humidors and cases.

Macdonald's other shop in neighboring Cambridge, Leavitt & Peirce, is run by his son Paul Jr., 39. Founded on Harvard Square in 1886 by Sam Leavitt and a Mr. Peirce, it has often been referred to as the "other college in the square," according to Macdonald. Many famous politicians have crossed its threshold, including Franklin Delano Roosevelt and Winston Churchill. Despite its devoted clientele, the store declined in the 1950s until a group of Harvard graduates campaigned to save the landmark. They approached fellow Harvard alumni William and Richard Ehrlich and asked them to purchase the store. In 1956, it became a part of the Ehrlich holdings. Macdonald started managing the store in 1973.

Besides cigars, the store displays a lot of Harvard memorabilia. "If you went into the store, it is like going back in history," says Macdonald. "It is more like a museum for Harvard. It is a wonderful store."

Macdonald emphatically believes in the cigar business, and he maintains that it is a fiercely competitive, yet equally friendly, business. "Because of the success, the industry has become much more friendly with each other. We are willing to share and talk about what's good in the industry."

Because Macdonald believes that the popularity of cigars will level in the next decade, he is diversifying his stores. Both stores have branched out to include more than tobacco products. David Ehrlich's offers wine as well as tobacco products, and Leavitt & Peirce provides customers with a selection of men's toiletries, leather goods and Harvard-associated products.

"Whatever the customer wants, as long as it is not illegal or immoral, you are going to get it," says Macdonald. "They don't really need you--you need them."

* * *

Straus Tobacconist, Cincinnati, Ohio
Established 1880

"The new cigar phenomenon has made the good stores much better and it has made the bad stores much worse." -James Clark, 39, owner

Half a nation away, in the heart of downtown Cincinnati, lies another historic tobacco landmark. Straus Tobacconist has a unique and hazy history that dates back about 115 years.

According to James Clark, the present owner of Straus Tobacconist, two brothers with the surname of Straus in 1880 opened a tobacco and convenience store in Cincinnati. Nearby was another mostly wholesale cigar shop bearing the name of Straus, which was owned by Henry Straus, who was no relation to the brothers.

The history of this store and wholesale operation is not very clear because proper records have not been kept over the years. In fact, 40 years worth seems to be lost, Clark says. The records between Henry Straus' death in the '30s and the Straus merger in 1973 are missing. This was a period that saw a number of ownership changes, Clark adds.

What is clear is that the two stores merged into one in the early 1970s. A wholesale/retail conglomerate called the Straus-Keilson Company (again, no relation) bought the smoke shops and operated them under one umbrella. Then in 1983, Core-Mark Distributors from Vancouver, British Columbia, bought the wholesale division (of the Straus merger) while STK Industries bought the retail side; Clark acquired the shops in 1991, just when the fledgling cigar market was making a comeback.

"In 1991, I noticed that we were getting a lot of requests from fellas for different cigars," he says. "We finished our new wall display pretty much at the same time as the initial Cigar Aficionado hit the stands. The timing was absolutely perfect."

Now, Clark has a challenging time keeping up with the demand for premium, hand-rolled cigars. With more than 100 premium brands to choose from, Straus Tobacconist's many new and old customers purchase anything they can get their hands on.

"Because of our location in the central business district of downtown Cincinnati, we have always had a clientele that had disposable income," Clark explains. "[Now] they are buying vintage quality, and they are not starting at the bottom....A couple of years ago, if you had told me that we would be selling $8 cigars as frequently as we do, I would have probably told you that you were crazy."

Clark doesn't see the demand for cigars declining soon. "I think we really need to offer these guys a good value for their money," Clark says. "As long as they continue to feel as though they are not being taken advantage of or lied to, you have a long-term customer."

* * *

W. Curtis Draper Tobacconist, Washington, D.C.
Established 1887

"Our business is not for the tired or the retired." -William E. Martin, former owner

Washington, D.C., is well known for its political brouhahas and national treasures. A notable landmark missing from the tourist guides is W. Curtis Draper Tobacconist, a tobacco shop more than a century old, which has seen its fair share of capital intrigue.

The shop was founded in 1887, a couple of blocks away from its current site at 14th and G Streets, by W. Curtis Draper, who had worked in the tobacco business. Draper remained with the shop until 1946, when he sold the store. Draper's sons were not interested in the business, so he sold it to William E. Martin, an accountant by profession, but a man who had helped around the tobacco shop since he was a teenager.

The current co-owner, John "Duke" Cox, worked under Martin during the 1970s and '80s. When Martin passed away in 1990, he left the shop to his wife, Frances, and Cox, who are currently partners.

Cox states that, although Draper founded the business and maintained a loyal clientele, it was Martin who really broadened the business and made it more lucrative. "Mr. Draper always maintained a full-line tobacco shop," Cox says. "He had cigars as well as pipe tobacco and pipes. However, Mr. Martin really expanded the cigar business when he took over. Mr. Draper had a nice community business. Mr. Martin really blew it out with the mail order. [He] made it well known, not only nationally but internationally."

The shop is extremely prosperous, selling humidors, cutters, cases and many cigar brands. According to Cox, W. Curtis Draper was one of two establishments that helped introduce Macanudo in 1970 to cigar lovers in the States, at a time when other countries were finally beginning to fill the void left by the loss of Cuban cigars.

The store has outlasted the terms of 20 U.S. presidents, Republican and Democrat alike. And both Republicans and Democrats have been shoppers. Who else can claim customers such as Calvin Coolidge, Richard Nixon and Gerald Ford?

"We know that the current president smokes cigars, even though they keep it low-key," says Cox. "There have been cigars bought for him here, but by whom I don't know. That's what happens now. They can't move around as well as they used to."

Regardless of laws passed by federal and state politicians to curb smoking, business is booming at W. Curtis Draper. Cox believes this success is because the store has outpaced the trends, with the help of strong leaders at the helm. "We just try to stay ahead of the game, to do the right things and make the right moves," he says. "There will be changes we'll have to make as a cigar store....I am going to do whatever is necessary."

* * *

Fader's, Baltimore
Established 1891

"The customers today are exactly the same as the customers from 100 years ago." -Bill Fader, owner

At about the same time that W. Curtis Draper began his business in Washington, D.C., a man named Abraham Fader opened his tobacco shop in nearby Baltimore. It is believed that he wasn't particularly interested in tobacco products, but that he opened the shop in order to survive, according to Bill Fader, the founder's grandson and the present owner of Fader's.

Business was good. In addition to the retail store, Abraham Fader operated a cigar factory where workers made handmade cigars. But in 1904, Baltimore was consumed by a citywide fire that destroyed the downtown area, including Fader's factory and warehouse.

The city was rebuilt almost immediately, and Fader reopened his factory and store. But the factory couldn't last. "The factory continued until the onset of machine-made cigars," Bill Fader says. "Handmade cigars could not compete with machine-made cigars. Our factory operation closed down in the early '20s."

Abraham Fader's son, Ira, joined the business after he returned from service in the First World War, although he was a chemist. The name of the shop was changed from A. Fader to A. Fader & Son. Bill's mother joined the team in 1930, the year that Bill was born. This made it a true family business, but the Faders had to work long hours to ensure the store's success.

"My parents were seldom able to take a vacation together. Having grown up in the business, I was expected to work, doing menial things through my teens," Bill Fader recalls. "My mother and father decided to take their first real vacation [in 1959], and they went to Europe. They went to Lucerne, where my father died unexpectedly." Bill and his father had become partners just days before his parents left for Europe, but upon his father's death, he took over completely, according to Bill.

Bill Fader was an engineer by trade, but he soon learned to love the cigar business. Because of the long hours and hard work, the business thrived, and he opened five branch stores in the next 27 years. But unlike his parents, he and his wife often take vacations.

Fader's offers a wide selection of humidors, cutters and cigar cases and carries 122 cigar brands. Few tobacconists carry more brands than Fader's does, he says. And few tobacconists can claim H.L. Mencken, Douglas MacArthur and Oprah Winfrey as customers.

"This is a business that you learn to love because you are primarily dealing with really nice people," Fader says. "Cigar smokers and pipe smokers are really nice people. You know your customers, and they know you. It is a very personal business."

* * *

Rich's Cigar Store Inc. Portland, Oregon
Established 1894

"If you can't find it somewhere else, Rich's will have it." -Tom Moran, 44, owner

The West Coast has its share of historic smoke shops as well. In 1894, 35 years after Oregon entered the Union, two relatives, Si S. Rich and B.B. Rich, decided to become tobacco merchants. Rich's Cigar Store Inc., sold cigars, pipes, cigarettes and snuff to recent settlers in the West. And the business thrived.

B.B. Rich left shortly after the turn of the century, and Si Rich ran the store until his son Jesse entered the business in 1914, according to Tom Moran, present owner of Rich's Cigar Store Inc. The store even branched out to include six additional stores. But the Riches eventually sold these other stores, and Jesse sold the original store to Moran in 1977.

"Jesse had a minor partner who didn't want to work anymore. And when he wanted out it kind of forced Jesse to make a decision," Moran says. "They had called me to manage the store. I just happened to be here when they wanted out, and I made an offer."

Moran never set out to own a cigar store, but once he started working at Rich's he loved it. It is fast-paced and very interesting, he says. And now he smokes almost anything he can get his hands on. With 168 brands available, he has a lot to choose from.

"We stock most everything, so it is hard to pick one brand over another," Moran says. "All the cigars do well. The sales have increased 25 percent a year in the past few years. We always emphasized cigars."

Many people are buying what Rich's is selling. Some notable customers include Clint Eastwood, Walter Cronkite, Ahmad Rashad and Robert Downey Jr. But regardless of the marquee value of the client's name, all customers are accorded the same respect, according to Moran. And the customer always comes first.

"We offer great service, great selection and variety," he says. "We will change somewhat with whatever changes [occur] in the marketplace, but we will continue doing what we do."

* * *

Rubovits Cigars, Chicago
Established 1894

"I hope the store is still here in 200 years." -David Mohr, 45, owner

Chicago boasts another centenary tobacco shop. In 1894, Louie and Izzie Rubovits established Rubovits Cigar at the board of trade building in Chicago. The Rubovits family owned the store for more than three decades. But in the 1930s, the family sold the store to partner Joe Loeser. His son, Stanley, worked at the shop during the Second World War and eventually took it over in the 1950s. David Mohr, the current owner, acquired the store from the younger Loeser in 1985, at a time when the industry and the store itself were in trouble.

"When I bought it, the store was in jeopardy because he [Stanley] had put in a women's jewelry section, and that was driving cigar smokers away," Mohr says. "When I bought it, that all went, and I went strictly with tobacco only. And that has been my policy; there is nothing in here that isn't tobacco-related."

Mohr is currently enjoying the fruits of his success. His business is up 50 percent from last year alone, he says. And he can't keep the more than 70 cigar brands or cigar-related accessories on the shelves.

Mohr hopes that the current trend toward cigar smoking doesn't diminish anytime soon. But he is skeptical of the people who are currently entering the hot industry solely for a quick buck.

"When I see the new people coming into this business, I wonder what will become of it in 100 years," he says. "I see the love that I have for this business in many of the manufacturers in the Caribbean and Honduras, as well as in many legitimate tobacconists. But I also see the greed in many of the businesses that are in it for a quick million and to take advantage of a current fad."

Current trend or not, the future burns brightly for cigar stores. Given the tendency of the general public to lose interest in a trend when it goes out of fashion, the current popularity in cigars may not continue at its present rate. But there are many avid cigar smokers who love the leaf for the pleasure and relaxation it brings, not for the notoriety. And for these cigar lovers, there will be tobacco shops to serve their needs for the next 100 years.

The Century Club

Demuth's Tobacco Shop (Founded 1770)
114 East King St.
Lancaster, Pennsylvania 17602
(717) 397-6613

Demuth Foundation Museum
(717) 299-9940

Iwan Ries & Co. (Founded 1857)
19 South Wabash Ave.
Chicago, Illinois 60603
(312) 372-1306

David P. Ehrlich Co. (Founded 1868)
32 Tremont St.
Boston, Massachusetts 02108
(617) 227-1720

L.J. Peretti Company, Inc. (Founded 1870)
2 1/2 Park Square
Boston, Massachusetts 02116
(617) 482-0218

Straus Tobacconist (Founded 1880)
410-412 Walnut St.
Cincinnati, Ohio 45202
(513) 621-3388

Leavitt & Peirce (Founded 1886)
1316 Massachusetts Ave.
Cambridge, Massachusetts 02138
(617) 547-0576

W. Curtis Draper Tobacconist (Founded 1887)
640 14th St. N.W.
Washington, D.C. 20005
(202) 638-2555

Fader's (Founded 1891)
107 East Baltimore St.
Baltimore, Maryland 21202
(410) 685-5511

Rich's Cigar Store Inc. (Founded 1894)
801 SW Alder St.
Portland, Oregon 97205
(503) 228-1700

Rubovits Cigars (Founded 1894)
320 South LaSalle St.
Chicago, Illinois 60604
(312) 939-3780, (800) 782-8499

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