International pricing policy by Habanos SA

[SCgarman]

19 minutes ago, MrBirdman said:

With all due respect, there is no logical inconsistency between those two positions. First, people who bought 19-21 stock based on the increase in quality did so in part because prices were expected to continue increasing faster than in the past. Even if they expected prices to stay flat, buying an inconsistent product when it is less inconsistent makes perfect sense. With prices going up, who wouldn't be happy about stocking up at lower prices when the quality was just as good?

Presumably those people stocked up at prices they felt were an acceptable value, but that is an entirely different and personal assessment. The increase in quality has been in the leaf, not so much construction. Now that you're paying twice as much for Cohiba, you're also paying twice as much for plugs and cigars that just aren't that good. So it's entirely logical for some people to conclude that, for them, the heightened quality of current production still does not outweigh the newer prices once you factor in the inconsistency premium. 

Also, most people here buy boxes without being able to fully inspect them personally ("fully inspect" meaning examining the entire box for plugs and other issues.) FOH absolutely reduces some of that uncertainty, but even Rob and crew aren't rolling every cigar between their fingers to look for high plug rates. No vendor does. And even with recent production I have still gotten the occasional box where most of the cigars are either plugged or so tight they irreparably suffer. I also have a box of Connie 1 that's essentially compost because the quality is so bad. It's a risk everyone has to take when they buy CC, and one's price-tolerance for writing off boxes is a personal calculation. 

And spending $300-400 for a box of compost when gasoline is approaching $5/gallon and food is through the roof is not a "value" by any means. HSA has adopted an FU attitude towards buyers of it's product. They have determined if they lose one customer, there will be twenty more potential customers to fill the void. This may very well work, or it may not. I'll just step back and observe. 

[Cairo]

15 hours ago, Enduin said:

Atabey, Casdagl

There is a vendor (hint: in CA) that has samplers of these on discount.   If that is not enough of a clue you can email me.

I bought a bunch of Opus Xs back in the day from a vendor who had an amazing deal on them--not my favorite smoke so I have not looked around lately.

The discounts are there--it just takes a bit of work....

[NSXCIGAR]

14 hours ago, Fugu said:

A Spaniard would never pay Hong Kong prices, period. You’d eventually destroy markets

Well, I guess we're about to find out. That's my view as well. Choosing HK as some kind of gold standard of price level is idiotic. HK and Spain (and most other countries) could not be more different in terms of market. The HK and UK markets are unique but even they are quite different. 

I agree, HSA has no control or ability to execute this plan as things are--that's why I keep pointing out that they'd have to usurp some or all of the distribution in order to facilitate this plan, and even if they did they'd be selling at near cost or at a loss on HK boxes to control prices there. 

As it is now the distributors fully own the boxes they buy and they retailers own the boxes they buy from the distributors. They can do what they wish with them. Age them, wholesale them--whatever. That's what would have to change if HSA wants to start controlling prices in individual countries. So we have highly unlikely that they will undermine the distributors and highly unlikely that they can even achieve the kind of price control they suggest they want. So doubly unlikely this bizarre and preposterous scheme is even tried. 

To me this seems like it really only affects Cohiba, Trini, Monte 1935 and RyJ LdO. The rest of the price increases are pretty much standard annual price increase plus current annual inflation, so about 10-15%. As long as supply is as low as it is now they can sustain that except for the RyJ LdO which hasn't even been around long enough for anyone to try. If they double the price on those good luck. Monte 1935 at least has been around for awhile but I wouldn't call it a huge success. $40 for a Dumas? Going to be a tough sell.  

[El Presidente]

43 minutes ago, NSXCIGAR said:

Well, I guess we're about to find out. That's my view as well. Choosing HK as some kind of gold standard of price level is idiotic. HK and Spain (and most other countries) could not be more different in terms of market. The HK and UK markets are unique but even they are quite different. 

I agree, HSA has no control or ability to execute this plan as things are--that's why I keep pointing out that they'd have to usurp some or all of the distribution in order to facilitate this plan, and even if they did they'd be selling at near cost or at a loss on HK boxes to control prices there. 

As it is now the distributors fully own the boxes they buy and they retailers own the boxes they buy from the distributors. They can do what they wish with them. Age them, wholesale them--whatever. That's what would have to change if HSA wants to start controlling prices in individual countries. So we have highly unlikely that they will undermine the distributors and highly unlikely that they can even achieve the kind of price control they suggest they want. So doubly unlikely this bizarre and preposterous scheme is even tried. 

To me this seems like it really only affects Cohiba, Trini, Monte 1935 and RyJ LdO. The rest of the price increases are pretty much standard annual price increase plus current annual inflation, so about 10-15%. As long as supply is as low as it is now they can sustain that except for the RyJ LdO which hasn't even been around long enough for anyone to try. If they double the price on those good luck. Monte 1935 at least has been around for awhile but I wouldn't call it a huge success. $40 for a Dumas? Going to be a tough sell.  

Lot's of good points but a few things to clarify. 

HSA owns 50% of many distributors (including many of the largest). 

What God giveth, god can taketh away.  Distributors not towing the line may find their tap turned off and given to another who is more co-operative. 

[NSXCIGAR]

1 hour ago, El Presidente said:

Lot's of good points but a few things to clarify. 

HSA owns 50% of many distributors (including many of the largest). 

What God giveth, god can taketh away.  Distributors not towing the line may find their tap turned off and given to another who is more co-operative. 

Yes, but the distributors own the other 50%. It's safe to say if a distributor balks it's for a reason. Good luck with HSA finding a more "cooperative" one. 

And as I said even if they can do what's needed in distribution they'd be selling at a huge discount or loss in HK/UK/CAN etc. to keep prices in those markets from rising. Good luck with them trying to keep CoRo at $1,400 in every country. I'll believe it when I see it.

[El Presidente]

3 minutes ago, NSXCIGAR said:

 Good luck with them trying to keep CoRo at $1,400 in every country. I'll believe it when I see it.

So will I.  

Keep in mind they no longer want you nor I smoking CORO. Only the Uber rich/glamorous. 

They want the world to stop, stare and bask in the glow of the demigod  seen smoking a Cohiba of any sort. 

 

[Fuzz]

12 minutes ago, El Presidente said:

So will I.  

Keep in mind they no longer want you nor I smoking CORO. Only the Uber rich/glamorous. 

They want the world to stop, stare and bask in the glow of the demigod  seen smoking a Cohiba of any sort. 

 

Time for me to bring out the glowing robes and portable smoke machine.

 

[BTWheezy]

11 minutes ago, El Presidente said:

So will I.  

Keep in mind they no longer want you nor I smoking CORO. Only the Uber rich/glamorous. 

They want the world to stop, stare and bask in the glow of the demigod  seen smoking a Cohiba of any sort. 

 

So @El Presidente - if this is the case, maybe crank up the Nudies business a notch or two, and start your own brand for the uber rich/glamorous demigods…how does “Kenhiba” sound?

[MossybackR]

2 hours ago, NSXCIGAR said:

To me this seems like it really only affects Cohiba, Trini, Monte 1935 and RyJ LdO. The rest of the price increases are pretty much standard annual price increase plus current annual inflation, so about 10-15%.

That’s my understanding, too — based primarily on the German price list. Does anyone else have substantial information?

[El Presidente]

7 minutes ago, BTWheezy said:

So @El Presidente - if this is the case, maybe crank up the Nudies business a notch or two, and start your own brand for the uber rich/glamorous demigods…how does “Kenhiba” sound?

 

The project needs a long lunch to kick around the concept!!!

Form the hip     CZARIBA

......that will have their legal team spitting coffee 😅

[NSXCIGAR]

22 minutes ago, El Presidente said:

So will I.  

Keep in mind they no longer want you nor I smoking CORO. Only the Uber rich/glamorous. 

They want the world to stop, stare and bask in the glow of the demigod  seen smoking a Cohiba of any sort. 

 

I have no doubt they want CoRo to be $1,400 and Esplendidos to be $2,400 but if the supply was what it was up to 2020 it's not possible. That's aside from the economically impossible feat of keeping CoRo at $1,400 in every country. 

HSA can double price but they'd better cut production in half, and that formula typically results in lower profits. Rarely is raising price and limiting supply more profitable. Every business wants to sell more units at lower prices over time as you can scale to achieve more profits despite lower prices. 

Nothing more to do here but wait and see if they even attempt this scheme and if so how long it lasts. Obviously we are seeing Cohiba prices up by about 50% at this point however we know there is very little being made. We'll see how this plays out over the coming months. 

[Fuzz]

15 minutes ago, El Presidente said:

 

The project needs a long lunch to kick around the concept!!!

Form the hip     CZARIBA

......that will have their legal team spitting coffee 😅

For those ultra rich athletes and rap stars, Trinidude.

[NSXCIGAR]

17 minutes ago, El Presidente said:

Form the hip     CZARIBA

I'm thinking CoRoba.

[Nocoins]

41 minutes ago, NSXCIGAR said:

I'm thinking CoRoba.

FOHiba is ready made. Works on a lot of levels. 

[Fugu]

13 hours ago, BTWheezy said:

…how does “Kenhiba” sound?

new posh line of men’s undies? 

[...]

On 5/27/2022 at 12:35 AM, El Presidente said:

HK - UK - Middle East  in terms of end price (retail) are roughly equivalent.  Combined, they would represent somewhere between 30-35%  of global market.  They won't be feeling any more pain than they are feeling now and sales are either steady (HK/UK) or booming (ME). 

Real concern (in terms of premium brand mark ups)  is for the major markets (etal Spain) where prices will treble.  Let's face it, HSA will find a market for Cohiba elsewhere if needed. 

NC's have never had a better opportunity to get a foothold in these markets. Not 10%  but 50% +.  Problem is that right now they do not have the spare stock to supply as the US market continues to boom. 

 

 

 

Just bought a few singles in Leipzig (Germany), they had a few boxes of cheaper Cubans and a mountain of NCs in the humidor…

[Ford2112]

2 hours ago, Fugu said:

new posh line of men’s undies? 

Kendies

[NapaNolan]

On 5/29/2022 at 9:42 AM, Cairo said:

There is a vendor (hint: in CA) that has samplers of these on discount.   If that is not enough of a clue you can email me.

I bought a bunch of Opus Xs back in the day from a vendor who had an amazing deal on them--not my favorite smoke so I have not looked around lately.

The discounts are there--it just takes a bit of work....

I went to their storefront last month and heard the clerks educating some customers on the value of the plume on their cigars. No joke.

[NSXCIGAR]

7 hours ago, NapaNolan said:

I went to their storefront last month and heard the clerks educating some customers on the value of the plume on their cigars. No joke.

In all fairness the only source that identifies plume as mold is FoH. For decades even the most knowledgeable experts have had the wrong idea. I doubt the cigar world will recognize it any time soon. In fact I've been pushed back on several times when I've tried to educate people. They think I'm a noob that just doesn't know what plume is so I just let it go. 

[Enduin]

The plume thing is so entrenched that I also think it's here to stay... With that said, knowing how much beneficial mold contributes to flavors and overall quality of products like cheese and cured meats, I can easily believe that cigars with extra growth of the white powdery mold previously known as plume could taste better.

I actually would not be surprised if part of what gives CCs their unique flavors were unique strains of beneficial mold found only in the Cuban curing/aging rooms, kind of like Trappist beers.

[...]

21 hours ago, Jeanff said:

Just bought a few singles in Leipzig (Germany), they had a few boxes of cheaper Cubans and a mountain of NCs in the humidor…

Bought a box of Demi-Tasse at Luxembourg LCDH earlier today, they are out of everything except some cheap & cheerful cigars… sad to see

[El Presidente]

4 hours ago, Jeanff said:

Bought a box of Demi-Tasse at Luxembourg LCDH earlier today, they are out of everything except some cheap & cheerful cigars… sad to see

I have no idea what is going on in some locales. 

Stock is very tight but retailers should be doing a little bit better than that. A LCDH to boot?  

 

[MrBirdman]

12 hours ago, NSXCIGAR said:

In all fairness the only source that identifies plume as mold is FoH. For decades even the most knowledgeable experts have had the wrong idea. I doubt the cigar world will recognize it any time soon. In fact I've been pushed back on several times when I've tried to educate people. They think I'm a noob that just doesn't know what plume is so I just let it go. 

Like many myths it’s grip remains strong generation after generation. Plume on aged cigars seems more plausible for American NC consumers because they’re virtually never sold fresh with mold. I’m a little less sure how CC smokers rationalize it when it’s not uncommon to find it on fresh cigars. 

Without naming names, I swear I once saw a video with a British cigar merchant (not Fox) say (I’m paraphrasing) “that white material is plume, it’s a sign the cigars have been well aged. It isn’t mold, but don’t let any get on the foot of your cigar.”

It is at least a harmless myth, so long as no one is growing mold on cigars to sell them at a premium. I feel as though I might regret putting that idea out there…🤔 

12 minutes ago, El Presidente said:

I have no idea what is going on in some locales. 

Stock is very tight but retailers should be doing a little bit better than that. A LCDH to boot? 

Rumor mill says that last month’s shipment to Munich’s LCDH from their distributor contained a few boxes of Mille Fleur and that’s it. 

Grain of salt recommended of course, but it wouldn’t surprise me if indeed true. 

[El Presidente]

13 minutes ago, MrBirdman said:

I feel as though I might regret putting that idea out there…🤔 

Czar Velvet range 

.....carefully crafted by hand but finished by the most exacting fungi, the Czar Velvet collection promises to titillate the most demanding palate. 

[El Presidente]

6 minutes ago, MrBirdman said:

Rumor mill says that last month’s shipment to Munich’s LCDH from their distributor contained a few boxes of Mille Fleur and that’s it. 

Grain of salt recommended of course, but it wouldn’t surprise me if indeed true. 

Sounds like a pricing repositioning move.

All new pricing globally should be in effect as of today (1st). It will be interesting to see if those shelves are a little fuller this morning.

We will go a few more days.