The Formidable Factory
When Abe Flores left the Dominican Republic in 1989, the cigar business was the last thing on his mind. After he graduated college and tried a career in the software and technology industries, the dot-com bubble burst, leaving Flores unemployed and unfocused. But his tech know-how landed him a job developing a website for a cigar retailer. Now, he's back in the Dominican Republic, and making 5 million cigars a year at a formidable factory that few outside the industry have heard of—PDR Cigars. His rise to relevance was quiet and slow, but he's managed to create a diverse and active operation that includes a line of his own brands, a slew of contract cigars and a lot of tobacco. His most recent—and perhaps most impressive—feat was landing the No. 10 spot on the Cigar Aficionado Top 25 cigars of 2014.
Senior editor Gregory Mottola sat down with Flores to talk about his transition from the world of digital technology to tobacco.
Mottola: Where were you born, Abe?
Flores: I was born in Queens, New York, in 1975 but moved to the Dominican Republic when I was three. My mother stayed in the United States to work at a textile factory and sent money back so my father could open up a bodega in Santo Domingo. I had a sister who was just born, and we lived with my grandmother for a while but she couldn't really take care of us so we moved to my grandfather's farm when I was about seven or eight years old. I started farm duties right away. You can't live on a farm and not work.
Q: What did your grandfather grow?
A: We had cattle, and a farm on a mountain in Bonao. We grew tobacco on the bottom, coffee on the top. Every morning I'd do farm work, plant seeds for beans and tobacco and coffee. I hated that. It was up in the mountains and a lot of work.
Q: How much tobacco?
A: About 10 acres, not that much, and we grew tobacco on and off, Criollo mostly. We even grew burley one year. My grandfather actually had a contract to provide La Aurora with cigarette tobacco. He got the land from [former Dominican dictator Rafael Leónidas] Trujillo. No matter what, he was always growing.
Q: When did you smoke your first cigar?
A: I smoked some rolled up andullo when I was eight years old. It made me throw up. [Andullo is a Dominican tobacco commonly used in pipes that is created by compressing cured leaves into hard, dense logs.] My grandfather would have me chew on raw tobacco. He'd say chew it. Smoke this. Taste this. This was the tobacco we grew.
Q: Did you think cigars or tobacco was a business you wanted to get into?
A: No way. I wanted to get the hell out of farming altogether. My grandfather grew tobacco but my dad was not a tobacco man. He was a military man. He was a commander for Trujillo before he started his grocery business. I worked on a farm, but my father didn't. When I was 13 or 14 years old my grandfather said he was going to make a man out of me.
Q: How did he do that?
A: By making me kill a cow. I had killed a chicken once, but that wasn't enough. I remember, my grandfather brings me to one of the cows. The cattle were locked into position for slaughter. It was like 7 o'clock in the morning and I was with my cousin and my uncle. My grandfather holds a machete up in the air—he always carried a machete—and brings it down on the cow's neck. Whack! It cuts halfway through the neck, into the spinal cord and the cow dies almost instantly. Then he hands me the machete and says ‘you try.'
Q: Did you do it?
A: I took the machete and tried to cut through but I couldn't cut deep enough. The cow started screaming and mooing and bucking. Blood gets all over me. So I tried to chop it again, but the cow wasn't holding still and the poor cow is still screaming and now blood is spraying on me and I start crying. "Kill the cow! Kill the cow!" my grandfather yells. I kept trying, but I couldn't do it right. Finally, my grandfather took the machete out of my hands and finished the cow off. I didn't want to work on a farm anymore.
Q: How did you leave the Dominican?
A: My father's grocery business closed, so we moved to Salem, Massachusetts, in 1989. My mother joined us from New York. That's when I picked up the cello. At the time the bass was too big but the violin was too small. So I started playing the upright bass in high school. I wanted to go to Tufts but I couldn't get the scholarship. I tried Boston College for part of the semester but didn't like it. I ended up at Merrimac College in Andover and graduated in 1999 with a degree in marketing.
Q: Did you go straight into the cigar business?
A: No. I graduated during the dot-com boom and worked as tech support for a company in Beverly, Massachusetts, for a year and a half. It was a French company, and they even sent me to France where I was in charge of getting distributors to sell the software.
Q: How did you become interested in cigars?
A: My cousin worked at an Italian restaurant in New York City. He'd go to the Dominican Republic and bring back cigars to sell them in the restaurant. Small local Dominican brands like Canal, Cibao by Jochy Blanco, Tamboril. Fake Cubans. Sometimes even real Cubans. I was surprised how well he was doing selling them as a side business. I became interested.
Q: What did you do?
A: I started getting cigars through my cousin and selling them to my coworkers. I even sold cigars to my boss. I didn't make a huge amount of money but it was enough supplemental income for me to buy an electric bass. I usually spent the money on musical instruments. But then the dot-com bubble burst, so I moved to New York and got a job at a Guitar Center store for awhile and then got a job in Westport, Connecticut, with a company that provided analytics and ad serving technologies. They got bought out and moved to California. I was unemployed again and didn't know what to do.
Q: Did you consider going back to the Dominican Republic?
A: Yes. In 2002 I asked about working at the La Aurora factory, but they were only hiring at the entry level and it didn't pay enough. I looked on Monster.com and saw an ad for an online cigar company. They wanted a web developer who spoke Spanish but who could also launch an entire site and who had some tobacco experience. The ad didn't specify the name of the company, but it ended up being Tinder Box retail tobacconists. They hired me to build a website and I ended up moving to Pennsylvania.
Q: Did you grow their business?
A: Of course. And their online presence too. They only had an infrastructural site. I changed it to a shopping-cart format and set up all the integration between the site, the warehouse, the call center and UPS. I have to give thanks to them though. They gave me the exposure to the business, the factories in Latin America and the industry overall. I was with Tinder Box for three years.
Q: How did you get involved with Don Leoncio?
A: He was a manufacturer who I met through Tinder Box. They carried his brand. I dealt with Juan Rodriguez, who was the president and was in business with his brothers, Ysidoro and Luis. They were making cigars in the Dominican Republic and also in New Orleans on Canal Street, but the bulk of the production was in Tamboril.
Q: You became part of that business?
A: At first I was a broker. I developed a line, would do a blend for a shop or a private label. I'd design the blend, the packaging and the bands. I'd get paid for that. Eventually I left Tinder Box and was with Don Leoncio full time.
Q: What kind of tobaccos were you working with at the time?
A: At the time, Dominican tobacco—Olor, San Vicente, Criollo '98. It was whatever we could find. Some Sumatra too. No Nicaraguan.
Q: What was the first big project you did for Don Leoncio?
A: A brand called Pinar del Rio. All the tobacco was Dominican Criollo '98 and it was all from tobacco grower Leo Reyes. When I was first working with Juan, I saw that the quality of the tobacco he was working with wasn't very good. I suggested getting tobacco from Reyes seeing how we weren't getting any Nicaraguan tobacco.
Q: Why weren't you getting any tobacco from Nicaragua?
A: When I was at Tinder Box, I met people but didn't know how to import Nicaraguan tobacco into the Dominican Republic, so I suggested Leo Reyes because he grows very good tobacco. I asked Reyes where he got the seeds for all his tobacco and he answered "Pinar del Río." [Pinar del Río is the western province of Cuba known for producing fine tobaccos.] And that's what we named our brand. When I created Pinar del Rio, I was not a partner, just an employee who developed the brand for them. Juan trademarked the brand Pinar del Rio, so it belonged to him.
Q: When was Pinar del Rio released?
A: It was launched at the 2008 International Premium Cigar & Pipe Retailers Association trade show. I opened up 12 accounts. But within six months, we had 50 accounts. It was made in the Dominican Republic, shipped to New Orleans and then sent out to retail.
Q: What was your business arrangement? Did you become a partner?
A: After the brand was launched, I got a percentage of the sales. I was never a partner with Don Leoncio. The company was always under financial stress and I didn't want to ever absorb the debt. My next project was called PDR. It's a cigar brand that coexisted with Pinar del Rio.
Q: What was the difference between the brands?
A: It's a different blend and the first time I started using Nicaraguan tobacco. I designed the packaging and called it PDR 1878, which was the year that Pinar del Río was founded in Cuba.
Q: Was PDR more successful than the Pinar del Rio brand?
A: Yes, right from the get-go. We sold 100,000 PDR cigars in the first few months. With the Pinar del Rio brand, we were barely getting by, but PDR moved very fast. It was released in 2009.
Q: Why do you think it was so much more successful?
A: For starters it was a really good price point—only $4.25 to $4.95 per cigar. But it was also a better blend: Brazilian Arapiraca wrapper, Criollo '98 binder and Criollo '98 filler, both Nicaraguan and Dominican. PDR 1878 was a real turning point. We exploded to 20 pairs of rollers and in the first year, we produced a little over a million cigars.
Q: Was there anything in the portfolio that even came close, volume wise?
A: No. Not at all. And money started coming in. That was something that the company wasn't used to. And nobody knew how to manage money properly or manage a successful company, so, of course, we started having problems.
Q: What kind of problems?
A: People started stealing.
Q: Stealing money?
A: No. Not money, but cigars and tobacco. There wasn't any consistent supervision at the factory in Tamboril, so employees would steal cigars and tobacco and sell them on the side. We were selling a lot of cigars—a lot for us, anyway—but so much was going out the back door. Sales were high, but we weren't making any money.
Q: So what did you do to change the situation?
A: Jochy Blanco approached me and offered me a much larger building where not only operation would be cheaper, but it was a lot more secure. I convinced Juan Rodriguez to move the operation. Then, I fired half of my rollers, all my factory managers, my accountant, pretty much everyone. We made the move in 2011.
Q: So you outgrew the Don Leoncio factory just on the success of the PDR 1878 alone?
Q: You eventually became a partner. Could you explain the transition from employee to part-owner?
A: Jochy wanted the lease for the new building to be under my name. Also, even though Juan owned the Pinar del Rio trademark, I owned the PDR trademark, which was much more successful. It was when we moved into the new building that I became a partner, but not under the name Don Leoncio. Juan later suffered a brain aneurism and almost died. After he
recovered, he closed the U.S. distribution of Don Leoncio and I opened PDR Cigars U.S.A. I bought out his and Ysidoro's shares. Luis stayed to run the factory. He is still with me.
Q: So you bought out Juan and Don Leoncio ceased to exist?
A: Yes, that is correct. And Luis Rodriguez is a partner in the factory, but not a partner with the U.S. distribution.
Q: You ended up phasing out Pinar del Rio completely to PDR Cigars. Why?
A: A few reasons. One, I got a cease and desist letter from Habanos S.A. They said that the name implies that my cigars are Cuban. But there was another reason. The PDR brand name became so popular that everyone was referring to us as PDR anyway. The retailers and consumers understood PDR, so because of that, and also for the sake of brand consistency we just became PDR Cigars. It was easier to remember and less confusing, plus I owned the PDR 1878 trademark. Now, the brand is PDR, the factory is PDR and the distribution is PDR.
Q: How much bigger was the new factory when you made the move?
A: Don Leoncio was about 5,000 square feet. The new factory was 40,000 square feet.
Q: That's an enormous jump. You grew by eight times?
A: Not exactly. The facility was 40,000 square feet, but I only occupied about 10,000 at first, with the understanding that I'd eventually occupy the entire place. Now I am at 30,000 operational square feet. Today, PDR Cigars employs 60 rollers, or 30 pairs of rollers.
Q: You make contract brands for third-party companies as well. When you first moved into the new factory, what brands did you produce?
A: Gurkha Ninja and Gurkha Viper. For myself, PDR 1878, which came in four blend varieties: black, white, blue and red labels. I also made some catalog brands.
Q: What kept you in business? Your own brands or your contract brands?
A: It's 50/50. Catalogs gave me cash flow, but margins were not that good. My own brands gave me higher margins.
Q: After PDR 1878, what was your next project?
A: The PDR Small Batch Reserve. It comes in a Habano or Maduro variety, but both are blended around a Cubra wrapper, which is a Cuban-seed wrapper grown in Brazil. I can't always get the wrapper. The Maduro is just a higher priming leaf. We turn it into a maduro wrapper through the boliado process. That means that after fermentation, you take an individual wrapper, add water and roll it up into a ball right in the palm of your hands. It naturally darkens the leaf. I can only get the Cubra wrapper twice a year. The filler is a mix of half Nicaraguan half Dominican tobacco.
Q: How do you go about purchasing tobacco?
A: On the filler side, I've contracted with major growers and with tobacco brokers like Universal Leaf. I've bought directly from smaller farmers before too, but I've also gotten screwed. I remember asking one small farmer for centro leaf, cut from the middle of the plant, and I paid him more for centro, but he was giving me lower primings and trying to convince me that it was the tobacco I paid for. So I moved to Universal. They are very trustworthy and very consistent. If I want Piloto Cubano and Criollo '98, that's what I get. For Nicaraguan tobacco, I go to Plasencia. Also trustworthy.
Q: Let's talk about fermentation. Does the tobacco you buy come already fermented, or do you ferment it yourself?
A: The Dominican tobacco that I buy from Universal, I ferment myself. From Plasencia, it comes fermented. It's more expensive to buy aged or fermented tobacco. You pay a premium. Fermented filler is about three times the price.
Q: When you buy unfermented Dominican tobacco, how long do you sit on it?
A: Lower primings, about one-and-a-half years. Higher-priming tobacco, about two to three years. But I try to keep two to three year's worth of inventory for my go-to tobaccos. I use those in every blend.
Q: What types are your go-to tobaccos?
A: That's my secret. But my fermentation process is really adjusted from year to year for consistency. Some years, the tobacco comes in stronger than others. I need to even out the consistency over large inventories of tobacco from year to year.
Q: How much tobacco do you have in total, poundwise?
A: I usually have about 30 to 40 thousand pounds of tobacco. That takes up around 15,000 square feet.
Q: Including contract brands, catalog brands and your own lines, how many cigars are you producing a year?
A: Four-and-a-half to 5 million cigars a year.
Q: What percentage of your production constitutes third-party brands?
A: Again, it's 50/50. Half are my own lines, the other half are contracted.
Q: How many contract brands do you make?
A: Well, let's see. There's La Palina Black, La Palina Classic, Gurkha 125th, Kristoff
Gallerones, Kristoff Classic Reserve, a brand called Heavy Duty for Eddie Ortega, and La Capitana for Villiger. But I'm also making some cigars for Viaje now too—the TNT and C4. Plus El Primer Mundo Epiphania and La Hermandad for Sean Williams.
Q: Which catalog brands do you make?
A: Obsidian, La Moneda and Cosecha Limitada.
Q: And your own brands?
A: PDR 1878 is my core brand and it comes in four varieties. I also make a PDR Small Batch Reserve in two varieties. Then there's the A. Flores 1975 Serie Privada in Habano and Maduro versions. Also, the A. Flores 1975 Gran Reserve. I make two lines that honor the partnership between Luis and I: The Flores y Rodriguez brand and the Flores y Rodriguez Reserva Limitada. Plus, the AFR-75 Edicion Limitada.
Q: Did you ever think you'd become so large?
A: No. I didn't think I'd get this far. I thought I'd make enough to survive, get my name out there and stay in business. I figured, if I was successful, I'd be doing 1 million cigars a year, tops.
Q: You've had some of your cigars on the Cigar Aficionado Top 25 list. What was your first?
A: The Gurkha 125th and La Palina Classic. It really got my name out there and put a spotlight on my factory within the industry.
Q: When did one of your own brands make the list?
A: It was the most recent one, 2014—the A. Flores 1975 Serie Privada Capa Habano SP52. That brought me fully into the spotlight.
Q: Did it affect sales?
A: Of course. It was selling decently before, but this was my first signature cigar with my name on it. I give the cigars six to eight months rest before I box them. After it made the list, demand for it jumped overnight. It's now my best seller.
Q: Are there rare tobaccos in the blend?
A: Not really. It's a pretty standard blend. The only thing special is the seven-year-old Dominican tobacco that I procured from Jochy Blanco.
Q: How much of Jochy's tobacco do you use?
A: I use the Corojo that he grows in La Canela. It's very unique. I use his Piloto Cubano too. That's my spice, my pepper.
Q: What is the PDR house style?
A: I'd say the style is in the construction. All my cigars are rolled entubado style, and all have triple caps. Some even have four caps. We like to mount the head. These elements give our cigars a very distinct look and, I think, different from anyone in the industry.
Q: What's your relationship with Blanco like?
A: I attribute most of my success to him. He's my mentor. I was going to throw in the towel when things weren't working out, but he talked me out of it. He gave me tobacco when I didn't have the money. He let me use the factory building and gave me a huge line of credit without charging me a single percentage of interest, and he let me build the factory I wanted to build and I paid him whenever I could. Without him, I would not be here.