Went to my local shop today...

[Franksmith]

Having owned a Bicycle store for many years....

I can tell you plain and simply... he is just trying to get by. If you get to know him I guarantee that he is NOT RICH or even wealthy and even worse just as normal as the rest of us. He has to pay for rent, insurance, Liability insurance, electricity, office supplies including the Humidifier stuff, Workman's compensation, advertising, phone, property taxes on store display equipment, self employment taxes that are a real pain, Payroll taxes, employee benefits, etc etc.

If you had even an inkling of how much all of this cost... especially the rent if it is just a decent local... it would shock you.

Local retailers WILL NEVER be able to compete with internet sellers. A lot of internet sellers are right out of there homes or a very inexpensive local. When you are paying anywhere from $500 to $5000 less for rent you can really lower some prices. I have no agenda for this reply other than to help you know that most small businesses fail and if somehow it does make it? I can guarantee that he worked his tail off and will continue to to keep it paying off (most likely WELL UNDER a 6 figure income)

Just guessing but....

Owning a small business is usually murder and he is the one that has put up all of his earnings, savings or borrowings and is taking all the risk and if it fails he loses it all. His shoes may not be very comfortable and you probably would not want to be walking in them.


Hope this helps

[Thurm15]

Well nobody in Ny State can compete with Jr's Prices I know that. Maybe I was alittle bit rash and I am pretty New to this whole thing, but I am a customer that got ripped off by him period. The guy sold me a box of AF brevas last year for $40 more than a store that he's competing with that's 10 miles from his. I just didn't know any better at the time and he knew it. He may be paying a different price Wholesale than his competitors but come on 40 Dollars?. Also, hes not in a location where he needs to jack up prices to pay the rent. A guy I work with works part-time at a local shop (pipesandcigars.com). He told me he's the Highest priced in the area by far.Obviously I don't need to do business with him but he does need my business and he's not gonna get me as a regular Customer with those Prices. Nothin wrong with letting him know that. I did buy a couple of sticks from him that day and we did have a friendly conversation.

[Franksmith]

If his prices are out of line with other local retailers then he is killing himself. His prices could vary on many factors...

Mainly his sales volume is the big factor.... if he is a fairly new business, say 2 years or younger, than he has not worked up buying (or selling depending on your angle) volume to get the prices the more established shops are getting. He could also be buying from a smaller distributor with higher prices because of his low volume.

Another is that some property leases include a cut of the gross profit to the landlord and retailers have to make up for it.

This is not to defend him at all because if his prices were too high I would go elsewhere too and I do most of my buying online for that reason. But then again my local cigar shop is first rate with a huge selection that is very carefully stored, they always have a pot of (good) coffee available to the customers and an awesome smoking room with comfortable chairs and some great ringside BS of the day floating around from the local gang

I still buy some occasional sticks from him... always if I am going to smoke it there but the prices are out of this world compared to online sales and I know why from my retail experience. For a rule of thumb... most brick and mortar retailers (like yours) absolutely hate the online retailers because they are shutting down a LOT of small independent retailers like himself... it is brutal out there and it is just getting worse with time. We can expect to see a lot of local guys like this go away... Like me, I closed my bike shop that had been operating for over fifty years.... times have changed and I am totally OK with it because I was sick to death of retail anyway... I didn't owe anyone a penny and I just closed it down, sold the property and went into sales and am making more $$ than I ever have for a couple of years now....

Times change but remember that the online guys are the mortal enemy of the local guys... even the ones that are surviving.

Hope I didn't ramble on too much

[MocoBird]

Originally Posted by Franksmith

self employment taxes that are a real pain,

(*#(@#&#&@!!!!!

Sorry!!!........just did my taxes yesterday

[Thurm15]

Thanks for all of the Responses. I still have alot to learn about this Hobby and how it all works. The way I'm seeing it now is that The Internet is like the Walmart of the Cigar Retail World. The Local Shops are the Mom and Pop stores just Trying to get by. Some do better than others and You can't replace the advice and comraderie you get from a Local Tobbacconist. However, I'm not paying $8 for a Stick that goes for $5 on the other side of town just for Sympathies sake. I gotta eat too.

[punch]

Here is my take on the issue, for what it is worth.

First, you did the right thing by talking to this guy. I have a similar situation in my town. One "cigar club" has prices so far out of line that it borders on comical. But they are in a more "upscale" section of town, and they are not at all embarrassed to say that they cater to a crowd that has more money than brains. They can sell an AF Flor Fina for $11.00 a stick because some dummy will pay that. The other reatailers are also high, but not that bad.

What I have done with a couple of them is come right out and be honest with them. I have told them "Look, I can get these a lot cheeper on line, but I would really like to support my local dealer. I know your overhead is higher and I am not asking you to take a loss, but what can you do for me?" A couple have given me rather good discounts. I make sure that I buy from them regularly, even though I do get most of my cigars on-line (something soon to change since my wife has seen a couple of CC bills).

As to the guy in Yuppyville with the way out of line prices? F*%$K him! I really don't like the crowd there that much anyway. Yes, he is a lot closer to me. But the other guys have made an effort to deal with me, so I believe that I owe them the effort of driving a bit more out of my way to deal with them.

[kansashat]

I would cringe at the idea of opening a "cigar" shop in just about any location but a tourist trap area where I could get "inflated" prices for my goods.

I've been in sales for years & regularly shake my head at the naivete of some of the "budding" business owners (hopefully I am not one of those ).

A good example would be the local school teacher that goes on vacation, sees a nice little coffee & pastry shop & thinks to herself, "Wouldn't it be nice if we had one of these in our little farm community of 9,000?"
She returns home, leases a store front on Main St; drops $30-40k on fixtures & fix up; opens for business & expects the community to flock to her door. Two-three months later she's closed.

I ask myself why didn't this person just spend a few intimate moments with a calculator? How many cups of coffee & danish do I have to sell to pay the overhead & make a decent profit? Hmmmm.

[Max_It]

[QUOTE=kansashat]I would cringe at the idea of opening a "cigar" shop in just about any location but a tourist trap area where I could get "inflated" prices for my goods.

I pretty much agree with that statement, but what about a cigar store that offers more than the usual?

Last year I went to Orlando and visited the Corona Cigar store. The location was sigificant, it was in Orlando, but it was not in the heart of any attraction (to me, it was the attraction!). It was the biggest cigar store I've ever seen. In addition to claiming over 1 million cigars were in stock (which was probably true), part of the store consisted of a really cool bar. I can't recall whether they also sold food. I did enjoy a couple of drinks while sampling a cigar or two. The guy tending the bar was more than happy to answer my questions about some the cigars that I was unfamiliar with. Pricing was all over the board, but mostly on the higher side. Some cigars were twice internet pricing. But even the higher prices were tolerable, considering the incredible awesomeness of the store. Being able to smoke a cigar in such a nice environment is worth something. The "in-house" Corona brands were very reasonably priced. This company ALSO sells on the internet, although I don't know much about whether or not they are competitive online. When I got back home, I kept thinking about how cool it would be to operate a similar store, just on a smaller scale. You know, a nice cigar bar, a few over head televisions for sports and a walk-in humidor at the end of the bar. Then reality sets in and I started thinking overhead costs could make profitability pretty difficult to obtain. I still think it would be really cool if Corona Cigar turned into a franchise and similar, but smaller scale, stores could open in locations through out the country. Corona's business model is so different than most mom and pap cigar stores. Combining a unique cigar/sports bar would attract a lot of people who aren't cigar nuts. Who knows for sure, maybe it could work in a Chicago suburb. I just need to work out a deal with Corona Cigar Co. and find some wealthy investors!!

[Franksmith]

Originally Posted by kansashat

I ask myself why didn't this person just spend a few intimate moments with a calculator? How many cups of coffee & danish do I have to sell to pay the overhead & make a decent profit? Hmmmm.

It really is crazy! There so many people EXACTLY as you say.... "oh, that looks like a fun way to make a living" but they DON'T DO THE MATH!!!

I have help quite a few people open businesses and talked a few out of it too and the best way to do it is with the calculator.

[magno]

Hey, Frank. What kind of stuff do you sell and do you do mailorder? PM me if you like. the only hobby I have that costs more than cigars is cycling.

--Magno

Originally Posted by Franksmith

Having owned a Bicycle store for many years....

I can tell you plain and simply... he is just trying to get by. If you get to know him I guarantee that he is NOT RICH or even wealthy and even worse just as normal as the rest of us. He has to pay for rent, insurance, Liability insurance, electricity, office supplies including the Humidifier stuff, Workman's compensation, advertising, phone, property taxes on store display equipment, self employment taxes that are a real pain, Payroll taxes, employee benefits, etc etc.

If you had even an inkling of how much all of this cost... especially the rent if it is just a decent local... it would shock you.

Local retailers WILL NEVER be able to compete with internet sellers. A lot of internet sellers are right out of there homes or a very inexpensive local. When you are paying anywhere from $500 to $5000 less for rent you can really lower some prices. I have no agenda for this reply other than to help you know that most small businesses fail and if somehow it does make it? I can guarantee that he worked his tail off and will continue to to keep it paying off (most likely WELL UNDER a 6 figure income)

Just guessing but....

Owning a small business is usually murder and he is the one that has put up all of his earnings, savings or borrowings and is taking all the risk and if it fails he loses it all. His shoes may not be very comfortable and you probably would not want to be walking in them.


Hope this helps

[magno]

On the face of things, I too could probably get my cigars cheaper online. (though I already get a pretty good discount from my regular shop) but then, I don't think JRs or Famous Smoke would give me cubans for my wedding anniversary, or Padron Anniversarios or Opus Xs just cuz they think I'm a nice guy and appreciate my business.

[Thurm15]

[QUOTE=Max_It]

Originally Posted by kansashat

I would cringe at the idea of opening a "cigar" shop in just about any location but a tourist trap area where I could get "inflated" prices for my goods.

I pretty much agree with that statement, but what about a cigar store that offers more than the usual?

Last year I went to Orlando and visited the Corona Cigar store. The location was sigificant, it was in Orlando, but it was not in the heart of any attraction (to me, it was the attraction!). It was the biggest cigar store I've ever seen. In addition to claiming over 1 million cigars were in stock (which was probably true), part of the store consisted of a really cool bar. I can't recall whether they also sold food. I did enjoy a couple of drinks while sampling a cigar or two. The guy tending the bar was more than happy to answer my questions about some the cigars that I was unfamiliar with. Pricing was all over the board, but mostly on the higher side. Some cigars were twice internet pricing. But even the higher prices were tolerable, considering the incredible awesomeness of the store. Being able to smoke a cigar in such a nice environment is worth something. The "in-house" Corona brands were very reasonably priced. This company ALSO sells on the internet, although I don't know much about whether or not they are competitive online. When I got back home, I kept thinking about how cool it would be to operate a similar store, just on a smaller scale. You know, a nice cigar bar, a few over head televisions for sports and a walk-in humidor at the end of the bar. Then reality sets in and I started thinking overhead costs could make profitability pretty difficult to obtain. I still think it would be really cool if Corona Cigar turned into a franchise and similar, but smaller scale, stores could open in locations through out the country. Corona's business model is so different than most mom and pap cigar stores. Combining a unique cigar/sports bar would attract a lot of people who aren't cigar nuts. Who knows for sure, maybe it could work in a Chicago suburb. I just need to work out a deal with Corona Cigar Co. and find some wealthy investors!!

I was just there last Feb. while on Vacation with my wife (see my Photo Gallery). The place was awsome. Nice bar, Friendly staff. Great Inventory too. I would say there prices were a little higher than I thought they would be but, I guess you have to expect that in a Tourist Spot. My wife and I had a good experience there and I did'nt mind spending a little extra on a few sticks.

[Thurm15]

Originally Posted by magno

On the face of things, I too could probably get my cigars cheaper online. (though I already get a pretty good discount from my regular shop) but then, I don't think JRs or Famous Smoke would give me cubans for my wedding anniversary, or Padron Anniversarios or Opus Xs just cuz they think I'm a nice guy and appreciate my business.

I don't get it. I never said that Local Cigar shops in General were ripoffs because of there high prices compared to Prices online. That would be like comparing Apples to Oranges. I've been talking about 1 Local Shop in General that Charges 30-50% more than all of the Shops in my area. I don't live in a tourist Trap and if he can't compete with the other stores prices then he maybe he don't belong in business and will probably get pushed out eventually anyways. Maybe his store is a front for a bookie business or something I don't know.

[punch]

It may be time for a reality check. We are talking about business, not welfare. Quite frankly, I don't care if someone makes a living at a business or not, it is simply not my problem. If they don't make it, they need to find a job doing something else. It is a question of value of the product for which you are going to spend part of YOUR living to purchase. The problem is that there are some misconceptions about value. Let us first address the internet houses:

A big pro is price. The price (note that I did not say value) of cigars over the net is nearly always lower than locally. If this is all that is important to the purchaser, than this is the way to go. Some big cons, however, are the fact that you often cannot purchase singles or small quantities for much less than locally (if at all). You have to wait for your purchase, sometimes quite a while. You are also buying sight unseen, with the associated risks. About all an internet site has going for it is price, and maybe selection.

Now, what the local guy has to understand is that he is not just selling cigars. He can't compete, period. If he is going to stay in business, he is selling VALUE. This has to be taken into account when a person decides to shell out his own money. Being able to go to a knowledgeable person, try out a product before you commit to quantity, be able to return a defective product for instant replacement; all of these have worth and contribute to the value of the product. But this value is has to be there. If a B&M wants to charge high prices and provide no extras, he is not going to make it. Using a fall back of "I've got to make a living" does not cut it with me. I need to make a living, too. I have to perform in order to do that. I can command what I get from my employer because I provide him enought VALUE to make what he pays me worth while. If a B&M wants my business, they have to do the same, or they're fired.

Once this is understood by BOTH sides, a reasonable arrangement can often be made. Communication is an important part of this process. I believe that it is more unfair to visit a business, have an unsatifactory experience, and say nothing. This gives the owner of the business no opportunity to make things right. Often the unsatisfactory experience is the result of a simple misunderstanding. When it is not, and the owner chooses to ignore you, then it is NOT unfair to cease doing business with that place, and to inform others of your experience in an honest and fair way.

[Funnymantrip]

This weekend I went to go visit my family for my dad's birthday. Right up the road from them is a nice smoke shop. On Saturday, after I went and looked at the new Star Wars toys that came out (yes, I am 2 headed to the shop with my wife and mother in tow. My mother fell in love with it. They gave her wine, she was able to try out some flavored cigars which she was curious about. She walked around and looked at Everything they had.

It was a nice trip for me as I got to try some stuff that my shop usually does not have. La Flor Dominicana Chisel. That was a really good cigar. I liked the shape and overall thought it was great. I have a few more that I will leave sitting in the box. Also picked up a Series X, an Upmann Maduro, ERDM robusto larga (my shop does not carry).

It was very nice to get to go somewhere new and browse their wares, still better than looking at a picture online..