A few years of rest can add to a cigar’s retail value. But does hoarding boutique brands invite new risks?
By William C. Nelson
It’s no secret that a highly specialized vintage-cigar industry is thriving in New York, London, Geneva — anywhere one finds lots of people with money who like nice things. For the cost-unconscious, pre-embargo Habanas can be obtained for prices reaching into the many thousands of dollars per box. That a single cigar might fetch $200 is not considered outlandish.
But then, what actually constitutes an aged, or “vintage,” cigar? At what moment can a box of premium smokes claim to be better than what they were when young? At what point does a cigar (or, for that matter, a person) become “aged”?
These terms are inexact in popular usage. It bears observing that the sorcery of box age works its magic on non-Cubans, too—and in fact, the age does not have to be extreme for a box to command a higher price than suggested retail. Even cigars with only five or six years of age can fetch a price that might well make the wait worthwhile, assuming the seller has storage capacity to allow a cache to repose. Many consumers claim they discern nuances of flavor in a 5-year-old cigar that factory-fresh specimens lack, and many are willing to pay for it.
Undoubtedly, at minimum, ammonia breaks down and starches convert to tastier sugars in a year-by-year transfigurement inside the cells of any well-stored tobacco. A cigar is, as the expression goes, a “living thing”—a small, rolled bundle of biomass that has to be safeguarded in a habitable environment like any other living thing, if Father Time is to do his proper magic. A cigar must be cared for if it is to go on living and improving until the moment flame comes to give its kiss.
Clearly, aging is a service that cigar professionals are better positioned to provide than most individual customers, who usually possess no more than a desktop humidor or two. Even then, not all consumers are fastidious in keeping a stash well cared for. The desired effects of aging can be wrought only if the product is assuredly protected in climate-controlled storage for an uninterrupted span of years. (By the way, many cigar professionals consider 64 percent humidity ideal for long-term aging—not 70 percent.) Making provision for such an exacting climate can be difficult, expensive and inconvenient in, say, a residential setting.
What this means is that the change that box age can bring, even if it only amounts to a softer, rounder tone in flavor profile, is a curiosity and a marketable quality in its own right. The guarded aging of cigars infuses a precious added value, one that makes the joy of a well-aged smoke a luxury never to be taken for granted—an extravagance whose provider deserves to be paid a premium for the trouble it took to deliver it.
We realize that not every brick-and-mortar cigar shop is prepared to store vast piles of inventory for years (or decades), even if the promise of a premium price beckons. But most neighborhood cigar stores with even just a bit of extra space to devote to aging can do something for their more discriminating customers. The need for the service of aging and the value of that service take on completely novel and complicated dimensions as new Food and Drug Administration (FDA) regulatory predations threaten some beloved brands with extinction.
Luis Rodriguez, co-owner of Mickey Blake’s, a large and luxuriously equipped cigar and lounge business in Southington and Milford, Connecticut, believes B&M operators and their customers should absolutely be preparing for the worst as the new rules get hammered out, and that includes beefing up held inventory of potentially endangered brands. He says, “In the past five years the market has really swung to what’s new. We have so many boutique and ultra-boutique cigars now, but some new brands could be going away” if threatened regulations pan out unfavorably. Rodriguez says he remains optimistic but that still a “general consensus is that we might have 18 to 36 months before products start disappearing from shelves.” This means that now is the time for the whole cigar community to start thinking about strategies these new rules might dictate to sellers, and to consumers.
It needs to be said: Dangers lurk here for tobacconists tempted to stockpile favorite new brands for later sale. According to some cigar industry people now engaged in talks with regulators and politicians, it is possible that the new rules will go beyond prohibiting the manufacture of unapproved post-2007 labels. They might also at some point prohibit the retail sale of such items. If it turns out that way, then any shop still in possession of unapproved tobacco products could, on the drop-dead date, find itself in possession of so much contraband and be forced to withdraw those products from retail shelves. Your vast store of 2009 Special Editions could turn to dust, as surely as Cinderella’s golden carriage changed to a pumpkin at midnight. It seems unbelievable that such a vile thing would be allowed to happen. But the possibility is on the table, and it bears watching.
Until we know for sure what contours these new regulations will finally take—and as we go to print, that target is still moving—we can still recommend a cautious approach to ensuring that customers maximize future access to recent product introductions they have come to love. Consumers could open their wallets and accumulate the products themselves. They could store boxes in climate-controlled lockers rented from their neighborhood retail outlets and cigar lounges, or they could stash their smokes in facilities they have installed in the home or office. Smokers on the strictest of budgets can even resort to an Igloo cooler or three. The point is that, whoever your customers are and however deep their resources, they need to know that future access to their favorite smokes might come down to whether they provide for themselves while they can. Brian Telford of Telford’s Pipe & Cigar in the San Francisco suburb of Mill Valley, California, says he has 176 lockers in his store.
“Available space fluctuates,” he says, “but there is always some space available.” Open space might become more of a premium once it dawns on customers that a number of their favorite brands are at risk, and especially if it develops that retailers will not be able to sell those brands once the new legal disposition takes hold. Locker space will, in that case, soon be more valuable than ever. It bears mentioning that humidor makers should stand prepared for a rush of orders, too, perhaps especially on home walk-in units, if a heavy bureaucratic hammer appears sure to come down. Larry Haggerty, the owner of BestHumidors.com, has been furnishing consumers and merchants with controlled cigar storage space for 25 years—everything from tabletop units to lockers to turnkey walk-in facilities. Haggerty knows there could be a run of new business should the FDA decide to make life difficult for sellers. He says, “Yeah, we’re ready, and we do humidors right. Stock your space and set the controls. They’ll keep your environment within 2 percent of whatever reading you set.” That’s some priceless peace of mind if you’re sitting on 80 boxes of fine, velvety sticks that can never be bought again.
What ultimately determines value for any amount of aging is market demand. In that vein, the market seems to be telling us that opportunities have recently multiplied for the brick-and-mortar operator willing to provide customers with the service of aging. More and more sellers are doing it, and it’s a wonderful thing. But we’re all going to have to pay attention to upcoming regulatory changes, and plan for them intelligently, if we are to safeguard our bottom lines and maximize everyone’s chance to enjoy the allure of a tastefully aged boutique cigar.