Esoterica Tobacciana - A History?
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Well JP, no one lives that long, so I assume you mean the longevity of the business and not the folks running it. My business is over 100 years old and going strong, with profit growth of at least 7% per year. Not too shabby. So yes, I think I know how to run one.
My observation from watching new people changing well established practices in small quality companies end up with less quality and occasionally no company. People who think they know more than the people who've been doing it right, usually don't. New and bigger is not always a good thing, though it temporarily feeds the ego maniacal.
And the Germain guys look pretty good for 193 years old too? That, of course, was precisely my point. Business conditions change. I like to think my business is run better than how it was run 100 years ago. I certainly know this - if you don't adapt and change and revitalize, and learn how to respond to changing market conditions, then any business will fail. Nostalgia only carries you so far.
In Canada we have our own germane (pardon the pun) example in the Hudson's Bay Company. One of the oldest corporations in the world, established by Royal charter in 1670. They ran on nostalgia for many years and came very close to the end a few years ago because they didn't adapt to change. Lucky for us, a yankee far smarter than I am purchased them for a song, turned them around, and has made a fortune in the process. Food for thought.
In Canada we have our own germane (pardon the pun) example in the Hudson's Bay Company. One of the oldest corporations in the world, established by Royal charter in 1670. They ran on nostalgia for many years and came very close to the end a few years ago because they didn't adapt to change. Lucky for us, a yankee far smarter than I am purchased them for a song, turned them around, and has made a fortune in the process. Food for thought.
EVERY business is interested in making money. That's the nature of business. Anyone who says that they're not in business to make money is just fibbing.
Well with SG, they use the same press, but did see a video that the government forced them to switch to a modern flake slicer and it really does one hell of a job cutting. Can't find the Utube addy, but it's there. Watching that machine dice up the flake and the tins hand fille, very cool.
Blends are blends, the mixtures and all that is easily replicated. Unlike cigars, tobacco is purchased from many growers, not their private plantation, and vary from year to year just like the tobacco quality itself, mostly due to weather. There's no secret beyond what and how they do it. If they had something unique it would have a patent. The boat is sailing, and really what they do does'nt matter to us, just a lost opportunity for them.
Don't smoke the stuff anyways, and just bought the Penzance to trade years from now. There are fewer pipesmokers every year and all that is happening is stocking. Pipe collecting is on the rise amd will continue not matter what happens with the tobacco trade.
It's going to hit from the bottom and the top. Right now there's not tax on raw leaf, can you imagine when they throw the 300% tax on that. Then throw an expensive sales licence for tobacco sales, plus the banning to sell to many states. The Internet tax and so many others - federal, state and even local. The small shops will be crushed.
On and On and On.
Blends are blends, the mixtures and all that is easily replicated. Unlike cigars, tobacco is purchased from many growers, not their private plantation, and vary from year to year just like the tobacco quality itself, mostly due to weather. There's no secret beyond what and how they do it. If they had something unique it would have a patent. The boat is sailing, and really what they do does'nt matter to us, just a lost opportunity for them.
Don't smoke the stuff anyways, and just bought the Penzance to trade years from now. There are fewer pipesmokers every year and all that is happening is stocking. Pipe collecting is on the rise amd will continue not matter what happens with the tobacco trade.
It's going to hit from the bottom and the top. Right now there's not tax on raw leaf, can you imagine when they throw the 300% tax on that. Then throw an expensive sales licence for tobacco sales, plus the banning to sell to many states. The Internet tax and so many others - federal, state and even local. The small shops will be crushed.
On and On and On.
I have to say, I love threads like this where we can have an adult conversation about an issue that is important to us. Even if we disagree on points (as appears to be the case here), I still love the fact that we can respect one another's strongly held views (even when they are so clearly wrong, LOL).
One thing that drives my wife nuts is that I am almost never personally invested in my opinion - I never associate criticism of my views as criticism of me, and I always assume that others operate in the same fashion. The wife and her family don't operate that way, which drives her nuts. Oh well, serves her right for marrying me.
One thing that drives my wife nuts is that I am almost never personally invested in my opinion - I never associate criticism of my views as criticism of me, and I always assume that others operate in the same fashion. The wife and her family don't operate that way, which drives her nuts. Oh well, serves her right for marrying me.
Sorry JP, should have been more specific, I wasn't talking about other companies replicating them, but the companies themselves replicating and increasing their volume, as in what and how they do it. The companies have their way of blending that makes the blend unique to them. What they are getting to make the blends is available to anyone. But what they're buying, and how their using it is the blend secret. Cigar manufacturers do have plantations devoted just to their companies and not available to others.
And they are both still around, aren't they?
A much more valid comparison would be to Morgan, in the automobile world. A small company, serving a particular audience, and being successful. Small, boutique companies can be and are successful. You don't have to be big to be successful.
http://www.youtube.com/watch?v=ekRzYGGJ8z0
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I think Jud made a good comparison there.
You can't repeat the past, but you can be inspired by it.
The biggest hit of 2012 may have been MB ODF. Can you find any on a shelf right now?
One reason ODF is so popular is because it's a great example of a classic British flake done up proper.
In an interview with Pipes&Tobaccos magazine Spring 2012 issue, Frank Blews of Mac Baren said some things which are worth quoting here in excerpt:
"Mac Baren is a great company to work with. This is a tobacco company. Tobacco people make decisions here, not some financial person who doesn't know anything except for bottom lines..."
Surely any bottomline beancountin' pencilpushers would've advised against how ODF was developed. The company insisted on doing it up proper and went to England to obtain some old steam presses just for making certain niche blends. Crazy ain't it?
" I have been involved in tobacco manufacturing around the world -- there are different processes throughout, although the tobacco itself may be the same. The English-style manufacturing process in general uses steam presses, which were predominantly used only in the United Kingdom, and many (if not most) of those old English tobacco houses are gone now."
"The project on our plate is to come out with a brand of tobacco made in the English style -- whether it be a readyrubbed or a cake -- made to the standards of the old-time English tobaccos from the 1940's and 1950's. This is a process of understanding history and manufacturing and then looking at products that were manufactured at that time and seeing what we could do to make that product properly today."
"Even if the English-style tobacco was a 1,000 percent hit, you're still talking about 2 to 3 percent of the total U.S. market. What influence would that really be except to say that we're able to produce that tobacco and distribute it worldwide."
"While most of the other tobacco companies look at the entire pipe tobacco market as an unprofitable niche that's more trouble than it's worth, Mac Baren's personnel are so dedicated to their tasks that they get excited about filling the niches in that niche market. They are, by and large, pipe tobacco geeks who eagerly seek new ways of expressing their professionalism and expertise one puff at a time."
"I'm just one little tobacco peddler in the U.S." he explains. "Only real tobacco people can see the long-term benefit of what we are asking them to do today. A new upstart business or a tobacco business that's run by finance people wouldn't do it."
:
:
https://www.youtube.com/watch?v=lFg25Oit3AI
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I think Jud made a good comparison there.
You can't repeat the past, but you can be inspired by it.
The biggest hit of 2012 may have been MB ODF. Can you find any on a shelf right now?
One reason ODF is so popular is because it's a great example of a classic British flake done up proper.
In an interview with Pipes&Tobaccos magazine Spring 2012 issue, Frank Blews of Mac Baren said some things which are worth quoting here in excerpt:
"Mac Baren is a great company to work with. This is a tobacco company. Tobacco people make decisions here, not some financial person who doesn't know anything except for bottom lines..."
Surely any bottomline beancountin' pencilpushers would've advised against how ODF was developed. The company insisted on doing it up proper and went to England to obtain some old steam presses just for making certain niche blends. Crazy ain't it?
" I have been involved in tobacco manufacturing around the world -- there are different processes throughout, although the tobacco itself may be the same. The English-style manufacturing process in general uses steam presses, which were predominantly used only in the United Kingdom, and many (if not most) of those old English tobacco houses are gone now."
"The project on our plate is to come out with a brand of tobacco made in the English style -- whether it be a readyrubbed or a cake -- made to the standards of the old-time English tobaccos from the 1940's and 1950's. This is a process of understanding history and manufacturing and then looking at products that were manufactured at that time and seeing what we could do to make that product properly today."
"Even if the English-style tobacco was a 1,000 percent hit, you're still talking about 2 to 3 percent of the total U.S. market. What influence would that really be except to say that we're able to produce that tobacco and distribute it worldwide."
"While most of the other tobacco companies look at the entire pipe tobacco market as an unprofitable niche that's more trouble than it's worth, Mac Baren's personnel are so dedicated to their tasks that they get excited about filling the niches in that niche market. They are, by and large, pipe tobacco geeks who eagerly seek new ways of expressing their professionalism and expertise one puff at a time."
"I'm just one little tobacco peddler in the U.S." he explains. "Only real tobacco people can see the long-term benefit of what we are asking them to do today. A new upstart business or a tobacco business that's run by finance people wouldn't do it."
:
:
https://www.youtube.com/watch?v=lFg25Oit3AI
I thought the Morgan comparison was good, I just assumed that the reference to Kodak and GM still being around was intended to be funny. It's always good when venerable old companies learn a lesson about what they are not doing right, but when they only do that in bankruptcy proceedings I think we can safely assume that they were doing something wrong and were, perhaps, resting on past laurels.
I seriously doubt that anyone buying Germains could ramp up production. It would require a major investment in machinery and equipment, as well as sourcing a larger supply of basic tobaccos. Which, given that these would have to be processed and aged specifically for the blends they produce, would take several years - especially when you consider that leaf tobacco is virtually unsmokeable for at least two or three years after harvesting (more likely four or five), and tobacco companies have adapted their methodologies to specific supplies and materials. As an example, Samuel Gawith boasts enough high quality Latakia to last a decade, but only at current levels of production.
By the way, most Burley and Virginia is grown in Brazil and Africa. Specifically for the cigarette industry, which determines exactly what is produced, to what quality standards, and according to which "taste" profiles.
Turkish is generic, rather than region and type specific. And most of that is destined for the cigarette industry (fields have been converted to Bright Leaf, and they now flue-cure it rather than sun dry, in addition to spraying the finished leaf with sugar for American style filter kings).
Latakia is limited to Cyprus (yeah, yeah, everyone claims they have Syrian..... that's a load of horsepuckey; Syria produces almost nothing, and Cyprus is running out of combustibles for smoke-curing, and out of water because of increased agricultural and urban demand besides).
Perique? One area, and not the most profitable crop in that area.
Quality control is always an issue. Remember Dunhills after BAT gave the blends to Murrays? Stalks, stalks, stalks, crud, and really abysmal leaf. Mostly stalks.
Yes, it CAN all be done more efficiently. Which is why Dunhill STILL hasn't recovered from what BAT did to the blends (farming it out, then off-shoring it in Denmark). And several of the Dunhill blends of yore were just not worthwhile for BAT to even try.
Balkan Sobranie is another prime example. Gallaghers diddled with the recipe so much that it became a mere generic Balkan.
By the time Greg Pease left Drucquers, many of the varietals that had been important components of the blends there were no longer available.
Given that pipe smokers are barely icing on the cake for most tobacconists, and far less than that for the entire tobacco industry, the incentive to keep steady and rely strictly on the supply lines and the markets that still exist outweighs any consideration of expanding and taking risks. If the proprietors of Germains have extra capital, they've probably invested it wisely in many other industries as well as a portfolio of bluechips. And considering the uncertainties of regulatory laws and labelling, there is little point in increasing production quite as yet. If ever.
It's quite likely that taxes and lung-cancer labels will lessen the number of smokers even further. The only expanding market is China, where pipe-smoking is seen as a luxury for the up-and-coming bourgeoisie. And even there, excepting Chinese grown flue-cured compost, all day smoking is becoming rarer. They'll probably follow the route of Hong Kong and ban smoking in all offices, parks, and shopping malls, as well as doubling the taxes to discourage any but the hard-core addicts.
If Germains produced specialty coffees, they'd be in the cat-bird seat. As a manufacturer of a mere niche of something which all governments in the first world are discouraging, they're holding their own in a dying industry.
Again, I stress that tobacconists DO NOT NEED US. Cigar sales pay the rent, we don't. And cigarettes are well over ninety percent of the total market in any case. Cigarettes are way more efficiently produced than any pipe tobacco, and far more profitable with lower investement.
By the way, I'm smoking one of my own blends right now. Everything that I like will eventually become unavailable, so it only makes sense to figure out how it was made.
In addition to stockpiling like crazy; I've got a thirty year supply which is still growing.
Mmmmm, Virginia.....
Regards,
---Atboth
By the way, most Burley and Virginia is grown in Brazil and Africa. Specifically for the cigarette industry, which determines exactly what is produced, to what quality standards, and according to which "taste" profiles.
Turkish is generic, rather than region and type specific. And most of that is destined for the cigarette industry (fields have been converted to Bright Leaf, and they now flue-cure it rather than sun dry, in addition to spraying the finished leaf with sugar for American style filter kings).
Latakia is limited to Cyprus (yeah, yeah, everyone claims they have Syrian..... that's a load of horsepuckey; Syria produces almost nothing, and Cyprus is running out of combustibles for smoke-curing, and out of water because of increased agricultural and urban demand besides).
Perique? One area, and not the most profitable crop in that area.
Quality control is always an issue. Remember Dunhills after BAT gave the blends to Murrays? Stalks, stalks, stalks, crud, and really abysmal leaf. Mostly stalks.
Yes, it CAN all be done more efficiently. Which is why Dunhill STILL hasn't recovered from what BAT did to the blends (farming it out, then off-shoring it in Denmark). And several of the Dunhill blends of yore were just not worthwhile for BAT to even try.
Balkan Sobranie is another prime example. Gallaghers diddled with the recipe so much that it became a mere generic Balkan.
By the time Greg Pease left Drucquers, many of the varietals that had been important components of the blends there were no longer available.
Given that pipe smokers are barely icing on the cake for most tobacconists, and far less than that for the entire tobacco industry, the incentive to keep steady and rely strictly on the supply lines and the markets that still exist outweighs any consideration of expanding and taking risks. If the proprietors of Germains have extra capital, they've probably invested it wisely in many other industries as well as a portfolio of bluechips. And considering the uncertainties of regulatory laws and labelling, there is little point in increasing production quite as yet. If ever.
It's quite likely that taxes and lung-cancer labels will lessen the number of smokers even further. The only expanding market is China, where pipe-smoking is seen as a luxury for the up-and-coming bourgeoisie. And even there, excepting Chinese grown flue-cured compost, all day smoking is becoming rarer. They'll probably follow the route of Hong Kong and ban smoking in all offices, parks, and shopping malls, as well as doubling the taxes to discourage any but the hard-core addicts.
If Germains produced specialty coffees, they'd be in the cat-bird seat. As a manufacturer of a mere niche of something which all governments in the first world are discouraging, they're holding their own in a dying industry.
Again, I stress that tobacconists DO NOT NEED US. Cigar sales pay the rent, we don't. And cigarettes are well over ninety percent of the total market in any case. Cigarettes are way more efficiently produced than any pipe tobacco, and far more profitable with lower investement.
By the way, I'm smoking one of my own blends right now. Everything that I like will eventually become unavailable, so it only makes sense to figure out how it was made.
In addition to stockpiling like crazy; I've got a thirty year supply which is still growing.
Mmmmm, Virginia.....
Regards,
---Atboth
I've bitched about it here and elsewhere, and since this seems pretty level headed and thoughtful, I'll bring it up again and ask for opinions, as I think it speaks to marketing and business plans.
My opinion is that Germain's reintroduction of Balkan Sobranie was a terrifically poor decision. The idea of ramping up a new (to them) blend when so many of their benchmarks lay unavailable - forget about Penzance and Stonehaven, how about the majority of the Smoker's Haven blends - was just terrible. Sure they are selling a bunch of BS that isn't really close to BS, but they always sell all the Krumble Kake, 20th Anniversary, Exotique, etc. that they can make.
So why muddy the waters with a reproduction of a blend that can never live up to the hype?
My opinion is that Germain's reintroduction of Balkan Sobranie was a terrifically poor decision. The idea of ramping up a new (to them) blend when so many of their benchmarks lay unavailable - forget about Penzance and Stonehaven, how about the majority of the Smoker's Haven blends - was just terrible. Sure they are selling a bunch of BS that isn't really close to BS, but they always sell all the Krumble Kake, 20th Anniversary, Exotique, etc. that they can make.
So why muddy the waters with a reproduction of a blend that can never live up to the hype?
Good points, atboth. And JP,I gotta agree with you. Let Sobranie go, and just get us Esoterica and Smoker's Haven blends. I was able to try some of those SH blends - I would love to see Krumble Kake or Exotique available again. I've made a note of some of the blends Germain sells under their own label to try, too.
I will stick to my statement that in 5 years Germain will have wished they increased production. They have the formulas it unwise for any business to not take advantage of market conditions. I have a hard time believing they could not be increasing production on Stonehaven and Penzance and putting less emphasis on their lesser selling brands.
When Don Carlos and Hemingway cigars became so popular, Carlos Fuente created more rolling rooms,trained more rollers, increased production and did not lose one iota of quality. It can be done. He is the smartest guy I know in the cigar industry and is always ahead of the curve.
When Don Carlos and Hemingway cigars became so popular, Carlos Fuente created more rolling rooms,trained more rollers, increased production and did not lose one iota of quality. It can be done. He is the smartest guy I know in the cigar industry and is always ahead of the curve.
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