A Crafted Business Plan: RoMa Craft Tobac

    RoMa Craft Tobac co-founder Skip Martin takes on the boutique moniker as he shows how any business, regardless of its size, can climb to the top of its industry.

    Skip Martin, Mike Rosales | RoMa Craft Tobac

    RoMa Craft Tobac may be small, but don’t call it boutique. To the company’s co-founder, Skip Martin, the term “boutique” refers to a product made for, and sold by, a specific retailer—and that’s not what Martin and those at his company are setting out to do. Instead, they refer to themselves as a “craft” producer that maintains its scale at a level where every aspect of production, distribution and engagement with its customers can be direct and dictated by the quality of the product or engagement—not by the demands that drive larger companies.

    “We built ourselves to be a small producer with a focus on the sourcing of high-quality raw materials, hands-on production and direct relationships with our consumers,” Martin explains. “More importantly, the term [“craft”] describes the culture we curate within our organization that emphasizes and enables all of these things … and that is what sets us apart.”

    Baka | RoMa Craft Tobac

    The cigar industry is full of companies like RoMa Craft Tobac that may be small but are making tobacco products meant for a variety of retail outlets ranging from the mass-market to the premium tobacconists. Martin doesn’t buy into the boutique mentality because he believes it’s limiting and doesn’t completely define his brand’s values and mission—and neither should you.

    Adjusting Course
    Martin and RoMa Craft Tobac’s other founder, Mike Rosales, had one goal when the pair started to make cigars: They wanted to make cigars that they would want to smoke themselves. Martin became a cigar smoker during the Cigar Boom of the 1990s. In 2006, Martin’s first foray into the tobacco industry on a professional level came when he served as a consultant for a friend who was starting a tobacco store in Galveston, Texas. Three days into the consulting gig, Martin realized the right move was to actually buy his friend out and build the business himself. Martin’s experience as a consumer gave him high expectations for what a retailer should be and do. Martin had learned from other retailers he had met over the years that it wasn’t enough to have business acumen or a passion for cigars. The most successful retailers had to have both. They also needed to have a desire to build a culture for their customers that would encourage growth and development. As a consumer traveling to different retailers, Martin developed his own knowledge and passion for cigars in the premium cigar subculture that existed within retail stores.

    In 2008, Hurricane Ike left Galveston—and Martin’s store—in ruins. As he picked up the pieces, Martin decided to create a private-label cigar that he could sell through mail order to his customers. A few trips to Nicaragua made him realize that in order to create a good cigar, he’d need a lot more resources and effort than he originally had planned for. Martin teamed up with Michael Rosales of Costa Rican Imports to bring his private-label cigar to life, not realizing he had just stumbled upon his next career path in tobacco as a brand owner. When the blends Martin and Rosales worked on in Costa Rica didn’t work out, they shifted production to Esteli, Nicaragua, and began working with Esteban Disla on what would later become CroMagnon.

    “Michael Rosales and I built RoMa Craft Tobac. Esteban Disla and I built Nica Sueno. Both were built to be great from the beginning, and to last,” says Martin. “We started with a very ambitious, strategic plan that established the foundational elements. We built on those. Here we are in 2019, an eight-year overnight success that literally took decades of experience to realize.”

    Martin and Rosales were inspired by a cigar sold in Martin’s store that they tried to recreate. When that proprietary blend was acquired by another company, they remained diligent in their quest to create a good blend. The early success of that blend, which came to be known as CroMagnon, led to the founding of RoMa Craft Tobac and even its own cigar factory.

    Whiskey Rebellion | RoMa Craft Tobac

    Reaching Quality Through Consistency
    The company’s focus has been on quality and consistency in its cigars rather than profit. According to Martin, neither quality nor consistency can be achieved without other important elements of business being properly executed. Leaders are responsible for shaping a company’s culture and its values, while managers must make sure they are hiring and developing the company’s employees. Operations should focus on supply-chain management and lean processes while the company’s sales department is responsible for choosing the right partners to work with so that quality of the company’s products is properly maintained all the way to the end consumer.

    “Quality requires attention and patience. Patience costs you time. Time costs you money. In the end, my primary role in my business is to build and maintain a culture where taking shortcuts is unacceptable, and constantly moving toward an unobtainable standard of perfection is the focus,” Martin explains. “For a number of growing companies, it’s primarily viewed as a financial concern. Quality frequently becomes a trade-off in the pursuit to grow market share, control costs or increase profits. We focus on being extremely efficient. Our efficiency allows us to pursue and maintain both quality and profitability.”

    Martin says that making a consistently great cigar is less about magic tobacco and secret processes and more about consistently making the hard decisions and financial investments required to always use high-quality tobacco and maintain quality in the processes required to produce cigars in the right way. If the right decisions and investments are made, a company should expect success, which cannot be achieved but rather maintained, according to Martin.

    Wanderlust | RoMa Craft TobacA Winning Strategy
    Since its launch eight years ago, RoMa Craft Tobac’s marketing plan has been centered on offering a differentiated tobacco product at a fair price and the dynamic that exists within the smoking community that enjoys its cigars. Where other companies have lofty goals and profit targets that drive their marketing initiatives, RoMa Craft Tobac has taken a simpler approach and instead has worked toward meeting the demand for its products generated by word-of-mouth. The company scaled as demand grew, taking an organic approach to growth that has kept it operating within its means and helped it to remain a relevant player in the overall competitive cigar market. Martin attributes much of the company’s success in business to the team he and Rosales have assembled over the years.

    “We are a fairly young company, but to the extent that we are where we are after almost nine years is a testament to the team we have built,” says Martin. “We have almost 70 employees at the factory in Esteli and four employees in Austin, [Texas]. In our entire history, there are less than 10 people that have worked with us that no longer do. That is an amazing number. It has become almost cliché, but our people are our strength. At every level, we have built a team of people with a sense of ownership in our mission. We take care of them. They take care of us. We all take care of our customers. It doesn’t hurt that we make some of the best cigars being sold in the world today.”

    Part of RoMa Craft Tobac’s success can also be attributed to its retail partners. The company currently has between 250 to 300 retailers it partners with, and it has relied on its consumers to select the retail outlets where its products are carried. The company’s focus has always been on making good cigars that are sold at a fair price. RoMa Craft Tobac started by selling to the retailers that it noticed consumers were talking about the most, then it began selling to the retailers that supported its consumer following.

    “We have high standards for ourselves and for those that represent us, and we actively maintain those standards by adding or eliminating retailers when it’s the right thing to do,” says Martin.

    When it comes to products, keep it simple, Martin suggests. He knows that for many in the tobacco industry, innovation often refers to new products, but due to the regulations imposed by the FDA, that has nearly come to an end. RoMa Craft Tobac released its first cigar lines—CroMagnon and Aquitaine—in 2011. Intemperance BA XXI and EC XVIII followed in 2012. Craft came in 2013. Neanderthal came in 2014. Wunder|Lust and Intemperance WR 1794 came in 2016. Every product the company has introduced is still produced and available today. While the industry may not see much innovation in terms of new products, Martin believes innovation is still achievable in other processes of the business, including curing and fermentation processes and technological advances that have changed how and where products can be sold and marketed to consumers.

    This story first appeared in the July/August 2019 issue of Tobacco Business magazine. Members of the tobacco industry are eligible for a complimentary subscription to our magazine. Click here for details.

    – Story by Antoine Reid, senior editor and digital content director for Tobacco Business Magazine. You can follow him on Instagram @editor.reid.