34
TOBACCO OUTLET BUSINESS
SEPTEMBER/OCTOBER 2012
not enough. We sell several millions of
dollars of cigars a year⎯in fact, we’re
the biggest seller of Davidoff cigars in
the country right now⎯so I have more
than enough in my bar/alcohol sales
allowance. I can sell $5,000 in alcohol a
night, no problem.”
Lustig boosted his cigar sales
significantly by selling directly to
casinos in New Jersey, Delaware and
West Virginia. They buy from him
because he offers them a good deal.
“
I’m more interested in getting my
gross sales up than I am in making huge
profit margins on cigars,” he states. “I
make my huge margins on alcohol I sell
for $6 that costs me 95 cents.”
By day, the vast space of Tinder Box
Waldorf is mostly empty, sprinkled here
andtherewithsomeprofessionalswhouse
the free Wi-Fi to conduct some business.
By night, it transforms into a cigar and
sports enthusiast playground, sometimes
hosting top-caliber musicians and jazz
events (paid for by Tinder Box Waldorf)
where cigar industry manufacturers such
as Rocky Patel and Nick Perdomo have
reportedly even joined in and played the
drums. “It’s so fun in here, sometimes the
hardest thing is getting the sponsoring
manufacturers to go out and sell cigars,”
says Lustig.
Tobacco outlets reading about Tinder
BoxWaldorf may be surprised to learn it
does not have a very upscale clientele.
“
We’re in a Washington, D.C. suburb
location that is not affluent—it’s more
like a blue collar area and we offer a
place of refuge,” Lustig explains. “It’s
a place where our customers can hang
out and smoke a cigar, relax and watch
a game. But it’s also a place where
dozens of people each month find jobs
from other customers who are in here.”
A Manufacturer Branches
Out to More Serious Cigar
Retailer
Many in the industry know D&R
Tobacco, historically for its RYO
tobacco, and, more recently, for its
brands of pipe tobacco. The company
is also a big distributor in tubes and
smoking accessories. But now it is
branching out even further in the
cigar world. It recently announced it
will be the exclusive U.S. importer of
Tabacalera cigars out of the Philippines
and as such, it will be re-energizing its
brick and mortar store in Smithfield,
North Carolina, Trisha’s Café, and re-
launching it as the first Tabacalera
Lounge, according to President Mark
Ryan.
“
With everything going on in the
industry, you can’t have all your
eggs in one basket anymore. I’m
continually looking for new ways to
diversify my portfolio,” Ryan tells
TOB
. “
If you don’t do something
new you’re going to die on the vine;
everything’s getting cut back.”
And so now Ryan is giving premium
cigar retailing “a shot.” At the IPCPR
show in August, he “bought like crazy,”
purchasing about $40,000 worth of
cigars to stock his newly built humidor,
in addition to the Tabacalera cigars he
will feature. “I can take advantage of my
influence of being a distributor as well
as a customer,” he says. He plans to
open the first Tabacalera lounge this fall
with some fun and fanfare.
One of the opening events Trisha’s
Lounge will sponsor will be with JACS,
a local area cigar club. Ryan describes
it as a “fun event with skeet shooting.”
Beyond that, Ryan will continue to
look for new cigar-related items to both
distributeandsellinhisstore.Herecently
became the exclusive U.S. distributor
for Hydrostone, a humidifying device
shaped like a tobacco leaf that holds 2.5
grams of water, made by a company
out of Belgium.
“
Iamconcernedaboutthecontraction
in this industry, affecting both my
retail business and my manufacturing/
distributing business,” admits Ryan. “In
both avenues, I’m trying to broaden my
portfolio, so that as things potentially
get picked off down the road, I can
survive and not have to lay off any
employees. I’m always looking for new
options for my customers.”
Adjusting and Changing
With the Times
Twenty-seven years ago, David
Garofalo, owner/founder of Two Guys
Smoke Shop (with his now-deceased
brother), started a good retail business
inMassachusetts. By 1996, he had three
stores successfully operating when a
bomb hit.
“
They threatened to raise the state
tax on cigars by 15 percent and I started
a one-man battle,” Garofalo recalls to
TOB
. “
I went to the local newspaper
and threatened to close up my shops
and move out of state if it went through.
“
With
everything
going on in the
industry, you
can’t have all
your eggs
in one basket
anymore.
I’m continually
looking for
new ways to
diversify my
portfolio.”
