July 10, 2026 • 21 mins
Most cigar brands don’t fail because the idea was bad. They fail because the fundamentals collapse under real pressure: inconsistent tobacco, unreliable supply, pricing that feels like a cash grab, or a brand that looks great once but can’t deliver the same premium cigar experience again. We get honest about what separates long-running cigar brands from short-lived launches, and why “execution” is the word that keeps coming up.
We walk through the Perdomo approach to cigar manufacturing and brand building, starting with vertical integration and why controlling the process from seed to box protects quality. We talk tobacco aging and deep inventory, the difference between core cigar lines and limited edition cigars, and why we refuse to chase trends that don’t serve the smoker. Along the way, we share how consistency turns into trust, and how trust turns into loyalty that lasts for decades.
Then we get practical about what happens at retail: why in stock position matters, how packaging design works as a silent salesman, why clean merchandising and organized displays improve ease of shopping, and how a fair cigar pricing strategy supports retailers and consumers without turning the product into a commodity. If you care about premium cigars, the cigar industry, or building brands the right way, this is a straight shot of principles you can measure.
Subscribe for more cigar education, share this with a friend who loves cigars, and leave a review with your take: what makes you stick with a cigar brand for the long haul?
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Episode Transcript
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SPEAKER_00 (00:00):
Welcome to the world of Perdomo Cigars.
We deliver the most authenticin-depth cigar education to you,
the cigar enthusiast.
Recorded at the Perdomo Studioin Miami, Florida, brought to
you by third and fourthgeneration Master Cigar Makers.
This is the Perdomo Podcast.
(00:22):
Your hosts, Nick and NicholasPerdomo.
Dad, welcome to the show.
SPEAKER_02 (00:28):
Glad to be back.
And I'm loving it.
I am too, Dad.
We got a lot more to go.
We got a lot more to go to go.
So today's a very it's anothercontroversial subject, but it's
something I'm excited to talkabout.
And it's about the cigarbusiness.
And specifically why brands failand why brands succeed.
(00:49):
And so every year there's alwaysnew cigar brands coming out.
And unfortunately, most brandsdon't make it.
You know, it's one of thosethings where a brand can't make
it just out of luck or hype.
And it's all about really justthe execution.
And today we're going to talkabout what makes cigar brands
successful.
And Dad, for us specificallyhere at Perdomo, I think it
(01:10):
starts number one, step numberone is manufacturing.
And you had a dream over 30years ago about being vertically
integrated.
And you've done that plus more.
And if you can, can you give ouraudience just a little bit
behind about a little bit aboutthis?
SPEAKER_01 (01:26):
Well, the first thing is I wanted to be in
control of my own destiny.
That was the first thing.
So I've made every cigar I'veever produced.
Our company has, whether weworked out of a garage or our
cigar factories in Miami andTampa or in Nicaragua, which
we've done in the last almost 30years now.
There's an old Italian sayingthat says, I don't want to buy
(01:49):
the clam.
You buy the clam and you end upgetting the can.
Right.
I'll explain to that in asecond.
And I think I'm proud of whatwe've done being vertically
integrated, where we doeverything from seed to box.
So when I started, even out ofmy garage, I was the boutique of
boutique cigar makers.
But I made every cigar today,and I'm not saying this by
(02:09):
everybody, but not to becontroversial either.
But a lot of these boutiquebrands are people that come to
Nicaragua, the DominicanRepublic and Honduras.
I see it every day when I'm downin a factory and they're
knocking on your door, asking,do you have anything you want to
get rid of, or so on?
And what these guys do is theyput bands on, slap them on, come
up with some limited editions,so many boxes, depending how
(02:31):
many cigars they can purchase,and come out with these cigars
at$20.
And I find that to be verydisingenuous, not only to the
retailer, but also to theconsumer, especially.
And I have a big problem withthat.
And I'm going to tell you whatmy problem is.
My problem is if you're aboutique maker, a small maker, a
large maker, the word makermeans something.
It means you made it, right?
So I'm proud to say that notonly we're completely vertically
(02:54):
integrated with great quality,but we've actually made every
cigar we ever made since thestart of your mother and I when
we worked out of our garage.
SPEAKER_02 (03:01):
Yeah.
And, you know, I think becauseof that, and becoming a
vertically integrated companyand putting the sacrifice and
really just the a lot of moneyto be vertically integrated
between the farms, thefactories, and so forth, we've
created consistency.
And that's what we're known fortoday.
And that's a blessing.
And that's due to you making usa vertically integrated company.
(03:23):
And consistency from brand tobrand, you know, it it gives us
the ability to change when weneed to make changes and pivot.
You know, we're not dependent onoutside suppliers.
I mean, you had your days whenyou first started, you were
living bail to bail.
Thank God we don't need to livelike that anymore.
And and you have to buy tobaccoand, you know, or contract, and
(03:44):
people contract factories tomake brands for them.
That's something, and they'realways looking to trace the
chase the trends, but that'ssomething that it's the hardest
way to be consistent.
And I'm just so grateful that wedon't have to worry about that.
SPEAKER_01 (03:56):
It's a great point.
And you know, I brought upearlier you buy the clam to get
the can.
What I meant by saying that isin the old days, and this is
what really turned me off, Iwould buy tobacco and it'd be
overhumidified, it'd be molded,it wasn't cured correctly, it
wasn't fermented properly, itwasn't aged properly.
And I had to control my owndestiny.
I that was the most importantthing because I said if I depend
(04:18):
on some of these guys, I'm gonnago out of business.
Sure.
And everybody wants a qualityproduct, and I did, most
especially.
And what happened was in thelatter part of the 90s, I
decided to grow tobacco.
It was the greatest decision Iever made.
But it took a while.
It took me three years to beable to build stocks.
And really, I only had greatwell-aged tobacco starting in
(04:41):
2000, not including the stocksof tobacco I bought.
But the tobacco I tried toproduce was better and better
and better.
And we did that.
And today, 26 years later, wehave a tremendous amount of
stocks of tobacco, well-agedtobacco with numerous years, and
that's been a blessing for us.
SPEAKER_02 (04:56):
Yeah, Dad.
And and that's consistency iseverything.
I agree.
You know, consistency, and Ithink our customers, the number
one expectation for cigarsmokers, they want to smoke the
same exact cigar of the lastcigar that they smoked, right?
And I think they want to havethe sit from the same flavor
profiles, construction, theywant that cigar each and every
(05:18):
time.
SPEAKER_01 (05:18):
I agree.
You know, consistently,consistency does one thing, it
builds trust, and people trustus, whether it be our retailers
or our consumers around theworld, and that's extremely
important to me.
And trust is what builds abrand.
We're not a commodity, we're abrand.
We're a family-run company thatbuilds a brand for generations
(05:39):
to come.
And these brands that we havehave been around for decades for
a reason because of itsconsistency, and that's why a
lot of people think we're one ofthe best in the industry today,
and I'm very proud of that.
SPEAKER_02 (05:51):
Yeah, I'm proud of it too, Dad.
And I think between theconsistency, the trust, I mean,
we've earned that, you know, andthat starts and that goes all
the way back to your decision ofI want to be a vertically
integrated company.
And today's cigar market is verydifferent, it's very difficult.
And you gave some some stuffprior to the point.
(06:11):
You made some points of the ofprior to the points that I'm
about to make right now.
But it seems like the cigarindustry today is divided
between core brands and limitededition brands.
And after 22 years, we are goingto be coming out with our second
limited edition brand, which isgoing to be Perdomo Legacy
Father and Son.
But really, it falls under theumbrella of Perdomo Legacy.
(06:34):
So even after the allotment thatwe release of Prodomo Legacy
Father and Son, and when it runsout, for example, for this
year's launch, it will be backand we'll continuously have it
every year.
But you still have PerdomoLegacy to smoke.
So that's that's part of ourstrategy with it.
We're giving you, you know,giving 10, 15-year-age tobaccos
and father and son, we're givingcigars that are really just the
(06:56):
tobaccos we've never usedbefore.
So it's something reallyspecial, limited.
It's truly is limited.
So, but if you could talk to ouraudience a little bit about why
we focus on core brands.
SPEAKER_01 (07:08):
Well, I'm very proud of our core brands.
If you take brands like Perdomo10th Anniversary, Perdomo
Habano, Perdomo Lotte 23,Perdomo Fresco, these brands
have one thing in common.
Their core brands have been outfor over two decades.
And if you take Perdomo 20thanniversary, it's one of our
youngest brands, and it's beenout for 16 years and it's still
(07:30):
selling incredibly.
We strategize a lot, we work alot with the tobaccos because
(07:51):
we're vertically integrated, butit does take us two to three
years to come out with a brand.
And I'm proud of that.
And when a smoker enjoys aproduct, they always want to buy
it.
And if you brought up a greatpoint, it's all about
consistency, and we're not in abusiness for one-hit wonders.
I've never been wanting to dothat.
And a lot of times we've retiredbrands because of table time,
(08:12):
not because the brands didn'tsell well, because people love
our consistency, and you broughtup another great point.
It's trust.
And we're here to build brandsthat last for decades, and we've
been doing it, and I have aresponsibility as your father,
too.
I have a responsibility to teachyou the correct things in life
and also in the cigar industry,but it's also about delivering
(08:36):
consistency for generations tocome for you to build things for
generations to come.
To me, that's paramount.
SPEAKER_02 (08:42):
Yeah, 100%, Dad.
And you know, it's theconsistent model that we've
created has built that loyalty.
It's built trust from theretailers to our consumers.
And I know that our retailerscan confidently place orders in
for Perdomo Cigars, knowing thatwe're going to deliver, and
consumers can find our productsanytime.
And you build a model that hascreated loyalty, and for this
(09:04):
we're grateful, but we'regrateful for the trust that our
consumers have given us and ourretail partners.
100%.
And yeah, it's I agree with you.
And I'm sorry, not to cut youoff, but you know, another big
thing that we're well knownwe're well known for is our
in-stock position.
And on the distribution side ofPerdomo Cigars, you always
(09:25):
taught me that in stockpositions everything.
If you don't have a brand orbrands in stock, you can't sell
cigars.
And so if you could, if you cangive our audience your opinion
and really the mindset behind ofalways of you always having the
mentality of always having ourbrands in stock.
SPEAKER_01 (09:44):
Strong inventories, of course, are paramount, but
strong inventories are equallyimportant, not only for the
manufacturer, but also for theretailer.
A lot of times, if you go into aretail store and they're out of
stock of our product, it'sbecause they didn't order or
they've been waiting to order.
And you have to have stronginventories.
David Garoflo brought up a greatpoint in a previous episode that
(10:06):
we had talking about howimportant it was to be an
in-stock position.
And part of his success was hewas always in in-stock position,
and we're the same way, andwe're afforded that luxury
because we have a tremendousinventory of well-aged tobaccos,
and we can be able to shipconsistently to the product, to
our retailers.
Reliable delivery and supportingour retailers is what I deeply
(10:29):
care about.
And at the end, the win goes tothe manufacturer, which would be
us, to the retailer, and mostnotably to the consumer.
And that's what we strive for.
SPEAKER_02 (10:39):
Yeah.
And our accountants don't likeit, but they don't get it.
And you know, it's it'severything.
In stock position is everything.
And I hate that when we're outof a skew for a couple of days,
but we're always there todeliver.
And so that's something thatyou've created in terms of
mentality and culture within thecompany.
Everything's about in-stockposition, Dan.
SPEAKER_01 (10:57):
Hey, Nicholas, we ship 99.48% complete.
We do.
I think we're the best in theindustry.
I'm very proud of that.
And I've never made a dollar ona back order, nor has a
retailer, but I'll tell youwhat, it's tested the patience
of many consumers because I talkto them all the time when I
travel around the country.
And one thing they don't like isgoing into a store and not being
(11:18):
able to buy the cigar they want,and we work really hard to
combat that.
100%, Dad.
SPEAKER_02 (11:22):
100%.
And you know, going into it now,talking about products, but
specifically, I want to talkabout packaging.
We are known for our beautifulpackaging, and we've spent a
tremendous amount of money forour packaging.
We use the best printers and wedo everything from the foils to
the golds, everything that wedo, the colors.
And we do it, it's for greatreason.
(11:43):
And why is packaging soimportant to you?
SPEAKER_01 (11:47):
Well, to me, packaging is not only a silent
salesman, it's the look and thefinal, the final dress of the
product per se.
I've always thought that ourcigars were much better in our
packaging.
And I wanted to level that up,and we worked really hard
together.
I think Arthur Kemper did aphenomenal job getting our
packaging right.
And we didn't we didn't chargepeople a penny extra for that,
(12:09):
by the way.
No.
But I think our packaging is thebest in the industry.
I think a visually appealingbrand is going to bring brand
clarity.
I think people know when they gointo the Prodomo section, they
can see it vividly.
That's extremely important tome.
And we most importantly, I wantto make it easy for the retailer
and the consumer to be able todistinguish our brands from
(12:31):
others.
And also the ease of shopping.
I want our consumers to be ableto buy our products at a quick
clip because they don't havetime to be looking around trying
to find things.
And I think our packaging is sodistinguished that it really
stands out and it makes it easyfor the retailer and the
consumer, especially topurchase.
SPEAKER_02 (12:52):
Well, I'm proud of the way we package our cigars,
Dad, because I think we payhonor to our family, your dad,
your great, your grandfather,and the ones before us.
You know, we're multiple we'remultiple generations in this
business.
And unfortunately, I don't likea lot of the packaging today.
And we're a premium cigar, andit's all about paying tradition,
paying honor to the ones beforeyou, the tradition, and I think
(13:16):
the elegance.
And I think elegance issomething that we hold strong
and we keep in within ourindustry today.
So I'm proud of your vision andI'm proud that we continue to
pay tribute to the ones who camebefore us and honor them in the
tradition of premium cigarmaking.
SPEAKER_01 (13:30):
Well, I got to give you kudos.
Look at Perdomo Legacy, Fatherand Son, where you pick those
colors, that green, which is itjumps off.
I mean, it's just beautiful, andwe're getting a lot of people
asking for it.
You saw what happened in NewOrleans at our trade show.
People absolutely loved it.
It's been incredible.
So I think we have a culturewhere not only do we develop the
(13:53):
greatest cigars in the world, inour opinions, and many opinions
around the world, but we alsowant to produce the greatest
packaging.
SPEAKER_02 (13:59):
When we stay on brand and we stay on Perdomo and
we stay on the culture, we keepourselves in the culture, we
keep ourselves in the family.
So whenever we do something new,it's always on brand.
And that's something that I'mproud of because a lot of people
try to find that trend.
And that's where you go wrong.
And so we we are the trend, andI'm proud of that, Dad.
And one of the other things,too, going from packaging, and
(14:21):
is we're known for the bestpricing.
And that's incredible.
I mean, you know, you look atthe packaging, the amount of
money we we invest, beingvertically integrated is
definitely not cheap, but wecontrol our own destiny.
And so I'm proud of that becausewe've created this trust and
this loyalty.
But we're known for our sharppricing structure, and our
pricing really is second tonone.
And really, what has always beenyour philosophy on price points?
SPEAKER_01 (14:44):
Well, the first thing where prices sell every
day.
Yep.
My father always said that hogsget slaughtered, and people will
find out sooner or later, andthey'll get tired of it.
And the second thing he alwayssaid is, I'll guarantee you one
thing, small margins guaranteeyou stay in business.
And I always took my father'sword, and he was usually always
right.
One of the things we've done iswe've been able to control our
(15:07):
cost in Nicaragua by beingvertically integrated and being
able to pass that savings on tothe consumer, yet give them an
incredible product that'sconsistent.
And that trust factor came in,like you said earlier.
We're not depending ondiscounting because we're not a
commodity brand.
We're a family brand that sellsevery single day with the utmost
of quality.
(15:27):
And considering our retailersand our consumers, which is
extremely important, and ourretailers' confidence in us and
our consumers' confidence in us,they trust us.
And at the end, everybody wins,whether it be the retailer and
especially the consumer, andeven us as the manufacturer.
And I'm extremely content withthat.
SPEAKER_02 (15:46):
Yeah, dad, 100%, and you know, consistency going from
packaging to price point, allthese things.
We took a we went outside theindustry back in probably about
2014, going on 12 years.
We went outside the industry andwe decided we wanted to emulate
the greatest company in theworld, Coca-Cola.
And we wanted to follow theirmarketing strategy and just in
(16:08):
terms of how they place theirproducts.
And one of the big emphasis forus is merchandising.
We're known for our beautiful,you know, prodomo walls.
And you know, I think one of thethings, and and there's always
more for us to grab, right?
And there's more that we aregoing to continue to grab in
retail stores.
And it's a big emphasis.
It's been a big emphasis for us.
But if you can, talk about theimportance of this the displays
(16:32):
that we have in retail storesacross the world.
SPEAKER_01 (16:35):
Well, what we want to do is we want to we think it
helps the retailer move theproduct more quickly.
We also believe it helps theconsumer with the ease of
shopping to be able to find ourproducts at a much quicker clip
because of the beautiful colorsand that Perdomo Mystique and
finesse that our packaging has.
I think it's extremely importantthat in majority of the
(16:56):
retailers, the best retailersaround the world, that we have
eye-level placement that'sextremely important for our
consumers and for us.
And clean clean displays, in mypersonal opinion, help consumers
buy with ease.
And that's where I bring backthe ease of shopping.
And I'm proud that every Perdomawall is always clean.
(17:16):
And I'm proud of our not onlyour sales team around the
country who really looks atevery single detail, whether a
shelf talkers folded, but allthe beautiful planograms our
guys do in Miami to assist oursales team and to assist our our
retailers.
And at the end, you know whowins?
The consumer.
And that's who we're fightingfor every day.
SPEAKER_02 (17:34):
100% that but you talk about ease and really the
ease of you know, even retailerswhen we talk to them, they feel
an ease.
They tell me, man, you know,ever since I merchandised and
ever since I placed your productthis way, even control my
inventory, just being able torefill boxes, because I know
where everything's at,everything's perfectly aligned,
(17:54):
perfectly set, and I'm able toI'm able to fill up my backstock
easier.
I'm able to show and and sell myyou know my customers because I
know where everything's at andeverything's so organized.
So ease is really a big word.
And you know, vertically, andyou know, everything's about
been about vertical.
And you know, dad, beingvertically integrated is
(18:16):
everything.
It is a sacrifice, yousacrificed, and I can tell you
personally from a personal levelas a kid, there were a lot of
days you were gone because youwere beating the shoe leather in
the road, trying to sell ourcigars in order to become
vertical.
And you spent weeks on end withmy grandfather in Nicaragua
building facilities, purchasingfarms and things like that.
(18:37):
So it wasn't just, hey, I took aloan and I I bought I bought
some farms, no way.
And you you really there was somuch that went into it.
And you know, it buildsvertically integrate being
vertically integrated iseverything.
You know, it builds loyalty, itbuilds trust, and that's where
we have that's due to us beingconsistent, but we focus on the
core brands, proper selling, thebest price points, packaging,
(19:00):
merchandising.
And this is our pronomalformula, and that's really and
it's something we're reallyproud of.
SPEAKER_01 (19:06):
Yeah, it's a tremendous amount of work.
Someone had brought a lettersaying that they had seen
someone saying that new brandsshould be given the best
placement, and brands like oursand a couple other famous big
brands should be on the floorbecause our brands sell.
And I had to laugh at theignorant comment because when I
started selling cigars, I wish Iwas on the floor.
(19:28):
Back in those days in the early90s, when you had all these
massive companies controllingall the the humidors,
deservingly so, because theyworked hard at it, and I had to
respect that work and I had toearn it.
Okay, that's that's a big point,earning it.
I was lucky if I was on thefloor.
I was usually put in thebackstock or behind the humidor
(19:49):
till there was a placement whereI could get a box of my cigars.
If I could get a box of mycigars on the floor, I was
really happy.
You get what you deserve withthe amount of work, and I want
to thank every one of you outthere, the consumers and the
retailers who've supported us,but you guys all know the amount
of work our family did fordecades to build our brands.
It was done through quality, itwas done through trust, but it
(20:10):
was done through a lot of hardwork.
SPEAKER_02 (20:12):
You mean you weren't given it?
SPEAKER_01 (20:13):
No, I wasn't given it.
It was a lot of hard work, and Inever said you should give me
the best shelf space, and allthese brands that did a great
job at their time should be puton the floor.
No, it to me it's insulting.
You get what you deserve, and itgoes through a lot of hard work.
And for us, you know, I look atit as it's all about the
fundamentals at Perdoma Cigars,about doing the things right,
(20:37):
producing consistent, greatcigars each and every time with
incredible packaging, and reallythinking about the consumer and
the retailers' need.
And it's how we build brandsthat have lasted for decades,
and my hope, and with the helpof God for generations to come.
Yeah, don't worry, Dad.
SPEAKER_02 (20:55):
We'll take care of it.
I trust you wholeheartedly.
I appreciate it, Dad.
Well, Dad, this was a greatshow.
I'd like to thank our audience.
I really appreciate the support.
We have a lot more to go, andthis was a great conversation.
Dad, thanks again.
Thank you guys, and thank youguys very much.
If you enjoyed this, please likeand subscribe and hit the
notification button on ourPerdomo YouTube page.
(21:17):
Also follow us at Perdomo Cigarson Instagram and Facebook.
We will see you very soon.
Thank you so much.
Thank you guys.
We'll see you soon.
Welcome to the world of Perdomo Cigars.
We deliver the most authenticin-depth cigar education to you,
the cigar enthusiast.
Recorded at the Perdomo Studioin Miami, Florida, brought to
you by third and fourthgeneration Master Cigar Makers.
This is the Perdomo Podcast.
(00:22):
Your hosts, Nick and NicholasPerdomo.
Dad, welcome to the show.
SPEAKER_02 (00:28):
Glad to be back.
And I'm loving it.
I am too, Dad.
We got a lot more to go.
We got a lot more to go to go.
So today's a very it's anothercontroversial subject, but it's
something I'm excited to talkabout.
And it's about the cigarbusiness.
And specifically why brands failand why brands succeed.
(00:49):
And so every year there's alwaysnew cigar brands coming out.
And unfortunately, most brandsdon't make it.
You know, it's one of thosethings where a brand can't make
it just out of luck or hype.
And it's all about really justthe execution.
And today we're going to talkabout what makes cigar brands
successful.
And Dad, for us specificallyhere at Perdomo, I think it
(01:10):
starts number one, step numberone is manufacturing.
And you had a dream over 30years ago about being vertically
integrated.
And you've done that plus more.
And if you can, can you give ouraudience just a little bit
behind about a little bit aboutthis?
SPEAKER_01 (01:26):
Well, the first thing is I wanted to be in
control of my own destiny.
That was the first thing.
So I've made every cigar I'veever produced.
Our company has, whether weworked out of a garage or our
cigar factories in Miami andTampa or in Nicaragua, which
we've done in the last almost 30years now.
There's an old Italian sayingthat says, I don't want to buy
(01:49):
the clam.
You buy the clam and you end upgetting the can.
Right.
I'll explain to that in asecond.
And I think I'm proud of whatwe've done being vertically
integrated, where we doeverything from seed to box.
So when I started, even out ofmy garage, I was the boutique of
boutique cigar makers.
But I made every cigar today,and I'm not saying this by
(02:09):
everybody, but not to becontroversial either.
But a lot of these boutiquebrands are people that come to
Nicaragua, the DominicanRepublic and Honduras.
I see it every day when I'm downin a factory and they're
knocking on your door, asking,do you have anything you want to
get rid of, or so on?
And what these guys do is theyput bands on, slap them on, come
up with some limited editions,so many boxes, depending how
(02:31):
many cigars they can purchase,and come out with these cigars
at$20.
And I find that to be verydisingenuous, not only to the
retailer, but also to theconsumer, especially.
And I have a big problem withthat.
And I'm going to tell you whatmy problem is.
My problem is if you're aboutique maker, a small maker, a
large maker, the word makermeans something.
It means you made it, right?
So I'm proud to say that notonly we're completely vertically
(02:54):
integrated with great quality,but we've actually made every
cigar we ever made since thestart of your mother and I when
we worked out of our garage.
SPEAKER_02 (03:01):
Yeah.
And, you know, I think becauseof that, and becoming a
vertically integrated companyand putting the sacrifice and
really just the a lot of moneyto be vertically integrated
between the farms, thefactories, and so forth, we've
created consistency.
And that's what we're known fortoday.
And that's a blessing.
And that's due to you making usa vertically integrated company.
(03:23):
And consistency from brand tobrand, you know, it it gives us
the ability to change when weneed to make changes and pivot.
You know, we're not dependent onoutside suppliers.
I mean, you had your days whenyou first started, you were
living bail to bail.
Thank God we don't need to livelike that anymore.
And and you have to buy tobaccoand, you know, or contract, and
(03:44):
people contract factories tomake brands for them.
That's something, and they'realways looking to trace the
chase the trends, but that'ssomething that it's the hardest
way to be consistent.
And I'm just so grateful that wedon't have to worry about that.
SPEAKER_01 (03:56):
It's a great point.
And you know, I brought upearlier you buy the clam to get
the can.
What I meant by saying that isin the old days, and this is
what really turned me off, Iwould buy tobacco and it'd be
overhumidified, it'd be molded,it wasn't cured correctly, it
wasn't fermented properly, itwasn't aged properly.
And I had to control my owndestiny.
I that was the most importantthing because I said if I depend
(04:18):
on some of these guys, I'm gonnago out of business.
Sure.
And everybody wants a qualityproduct, and I did, most
especially.
And what happened was in thelatter part of the 90s, I
decided to grow tobacco.
It was the greatest decision Iever made.
But it took a while.
It took me three years to beable to build stocks.
And really, I only had greatwell-aged tobacco starting in
(04:41):
2000, not including the stocksof tobacco I bought.
But the tobacco I tried toproduce was better and better
and better.
And we did that.
And today, 26 years later, wehave a tremendous amount of
stocks of tobacco, well-agedtobacco with numerous years, and
that's been a blessing for us.
SPEAKER_02 (04:56):
Yeah, Dad.
And and that's consistency iseverything.
I agree.
You know, consistency, and Ithink our customers, the number
one expectation for cigarsmokers, they want to smoke the
same exact cigar of the lastcigar that they smoked, right?
And I think they want to havethe sit from the same flavor
profiles, construction, theywant that cigar each and every
(05:18):
time.
SPEAKER_01 (05:18):
I agree.
You know, consistently,consistency does one thing, it
builds trust, and people trustus, whether it be our retailers
or our consumers around theworld, and that's extremely
important to me.
And trust is what builds abrand.
We're not a commodity, we're abrand.
We're a family-run company thatbuilds a brand for generations
(05:39):
to come.
And these brands that we havehave been around for decades for
a reason because of itsconsistency, and that's why a
lot of people think we're one ofthe best in the industry today,
and I'm very proud of that.
SPEAKER_02 (05:51):
Yeah, I'm proud of it too, Dad.
And I think between theconsistency, the trust, I mean,
we've earned that, you know, andthat starts and that goes all
the way back to your decision ofI want to be a vertically
integrated company.
And today's cigar market is verydifferent, it's very difficult.
And you gave some some stuffprior to the point.
(06:11):
You made some points of the ofprior to the points that I'm
about to make right now.
But it seems like the cigarindustry today is divided
between core brands and limitededition brands.
And after 22 years, we are goingto be coming out with our second
limited edition brand, which isgoing to be Perdomo Legacy
Father and Son.
But really, it falls under theumbrella of Perdomo Legacy.
(06:34):
So even after the allotment thatwe release of Prodomo Legacy
Father and Son, and when it runsout, for example, for this
year's launch, it will be backand we'll continuously have it
every year.
But you still have PerdomoLegacy to smoke.
So that's that's part of ourstrategy with it.
We're giving you, you know,giving 10, 15-year-age tobaccos
and father and son, we're givingcigars that are really just the
(06:56):
tobaccos we've never usedbefore.
So it's something reallyspecial, limited.
It's truly is limited.
So, but if you could talk to ouraudience a little bit about why
we focus on core brands.
SPEAKER_01 (07:08):
Well, I'm very proud of our core brands.
If you take brands like Perdomo10th Anniversary, Perdomo
Habano, Perdomo Lotte 23,Perdomo Fresco, these brands
have one thing in common.
Their core brands have been outfor over two decades.
And if you take Perdomo 20thanniversary, it's one of our
youngest brands, and it's beenout for 16 years and it's still
(07:30):
selling incredibly.
We strategize a lot, we work alot with the tobaccos because
(07:51):
we're vertically integrated, butit does take us two to three
years to come out with a brand.
And I'm proud of that.
And when a smoker enjoys aproduct, they always want to buy
it.
And if you brought up a greatpoint, it's all about
consistency, and we're not in abusiness for one-hit wonders.
I've never been wanting to dothat.
And a lot of times we've retiredbrands because of table time,
(08:12):
not because the brands didn'tsell well, because people love
our consistency, and you broughtup another great point.
It's trust.
And we're here to build brandsthat last for decades, and we've
been doing it, and I have aresponsibility as your father,
too.
I have a responsibility to teachyou the correct things in life
and also in the cigar industry,but it's also about delivering
(08:36):
consistency for generations tocome for you to build things for
generations to come.
To me, that's paramount.
SPEAKER_02 (08:42):
Yeah, 100%, Dad.
And you know, it's theconsistent model that we've
created has built that loyalty.
It's built trust from theretailers to our consumers.
And I know that our retailerscan confidently place orders in
for Perdomo Cigars, knowing thatwe're going to deliver, and
consumers can find our productsanytime.
And you build a model that hascreated loyalty, and for this
(09:04):
we're grateful, but we'regrateful for the trust that our
consumers have given us and ourretail partners.
100%.
And yeah, it's I agree with you.
And I'm sorry, not to cut youoff, but you know, another big
thing that we're well knownwe're well known for is our
in-stock position.
And on the distribution side ofPerdomo Cigars, you always
(09:25):
taught me that in stockpositions everything.
If you don't have a brand orbrands in stock, you can't sell
cigars.
And so if you could, if you cangive our audience your opinion
and really the mindset behind ofalways of you always having the
mentality of always having ourbrands in stock.
SPEAKER_01 (09:44):
Strong inventories, of course, are paramount, but
strong inventories are equallyimportant, not only for the
manufacturer, but also for theretailer.
A lot of times, if you go into aretail store and they're out of
stock of our product, it'sbecause they didn't order or
they've been waiting to order.
And you have to have stronginventories.
David Garoflo brought up a greatpoint in a previous episode that
(10:06):
we had talking about howimportant it was to be an
in-stock position.
And part of his success was hewas always in in-stock position,
and we're the same way, andwe're afforded that luxury
because we have a tremendousinventory of well-aged tobaccos,
and we can be able to shipconsistently to the product, to
our retailers.
Reliable delivery and supportingour retailers is what I deeply
(10:29):
care about.
And at the end, the win goes tothe manufacturer, which would be
us, to the retailer, and mostnotably to the consumer.
And that's what we strive for.
SPEAKER_02 (10:39):
Yeah.
And our accountants don't likeit, but they don't get it.
And you know, it's it'severything.
In stock position is everything.
And I hate that when we're outof a skew for a couple of days,
but we're always there todeliver.
And so that's something thatyou've created in terms of
mentality and culture within thecompany.
Everything's about in-stockposition, Dan.
SPEAKER_01 (10:57):
Hey, Nicholas, we ship 99.48% complete.
We do.
I think we're the best in theindustry.
I'm very proud of that.
And I've never made a dollar ona back order, nor has a
retailer, but I'll tell youwhat, it's tested the patience
of many consumers because I talkto them all the time when I
travel around the country.
And one thing they don't like isgoing into a store and not being
(11:18):
able to buy the cigar they want,and we work really hard to
combat that.
100%, Dad.
SPEAKER_02 (11:22):
100%.
And you know, going into it now,talking about products, but
specifically, I want to talkabout packaging.
We are known for our beautifulpackaging, and we've spent a
tremendous amount of money forour packaging.
We use the best printers and wedo everything from the foils to
the golds, everything that wedo, the colors.
And we do it, it's for greatreason.
(11:43):
And why is packaging soimportant to you?
SPEAKER_01 (11:47):
Well, to me, packaging is not only a silent
salesman, it's the look and thefinal, the final dress of the
product per se.
I've always thought that ourcigars were much better in our
packaging.
And I wanted to level that up,and we worked really hard
together.
I think Arthur Kemper did aphenomenal job getting our
packaging right.
And we didn't we didn't chargepeople a penny extra for that,
(12:09):
by the way.
No.
But I think our packaging is thebest in the industry.
I think a visually appealingbrand is going to bring brand
clarity.
I think people know when they gointo the Prodomo section, they
can see it vividly.
That's extremely important tome.
And we most importantly, I wantto make it easy for the retailer
and the consumer to be able todistinguish our brands from
(12:31):
others.
And also the ease of shopping.
I want our consumers to be ableto buy our products at a quick
clip because they don't havetime to be looking around trying
to find things.
And I think our packaging is sodistinguished that it really
stands out and it makes it easyfor the retailer and the
consumer, especially topurchase.
SPEAKER_02 (12:52):
Well, I'm proud of the way we package our cigars,
Dad, because I think we payhonor to our family, your dad,
your great, your grandfather,and the ones before us.
You know, we're multiple we'remultiple generations in this
business.
And unfortunately, I don't likea lot of the packaging today.
And we're a premium cigar, andit's all about paying tradition,
paying honor to the ones beforeyou, the tradition, and I think
(13:16):
the elegance.
And I think elegance issomething that we hold strong
and we keep in within ourindustry today.
So I'm proud of your vision andI'm proud that we continue to
pay tribute to the ones who camebefore us and honor them in the
tradition of premium cigarmaking.
SPEAKER_01 (13:30):
Well, I got to give you kudos.
Look at Perdomo Legacy, Fatherand Son, where you pick those
colors, that green, which is itjumps off.
I mean, it's just beautiful, andwe're getting a lot of people
asking for it.
You saw what happened in NewOrleans at our trade show.
People absolutely loved it.
It's been incredible.
So I think we have a culturewhere not only do we develop the
(13:53):
greatest cigars in the world, inour opinions, and many opinions
around the world, but we alsowant to produce the greatest
packaging.
SPEAKER_02 (13:59):
When we stay on brand and we stay on Perdomo and
we stay on the culture, we keepourselves in the culture, we
keep ourselves in the family.
So whenever we do something new,it's always on brand.
And that's something that I'mproud of because a lot of people
try to find that trend.
And that's where you go wrong.
And so we we are the trend, andI'm proud of that, Dad.
And one of the other things,too, going from packaging, and
(14:21):
is we're known for the bestpricing.
And that's incredible.
I mean, you know, you look atthe packaging, the amount of
money we we invest, beingvertically integrated is
definitely not cheap, but wecontrol our own destiny.
And so I'm proud of that becausewe've created this trust and
this loyalty.
But we're known for our sharppricing structure, and our
pricing really is second tonone.
And really, what has always beenyour philosophy on price points?
SPEAKER_01 (14:44):
Well, the first thing where prices sell every
day.
Yep.
My father always said that hogsget slaughtered, and people will
find out sooner or later, andthey'll get tired of it.
And the second thing he alwayssaid is, I'll guarantee you one
thing, small margins guaranteeyou stay in business.
And I always took my father'sword, and he was usually always
right.
One of the things we've done iswe've been able to control our
(15:07):
cost in Nicaragua by beingvertically integrated and being
able to pass that savings on tothe consumer, yet give them an
incredible product that'sconsistent.
And that trust factor came in,like you said earlier.
We're not depending ondiscounting because we're not a
commodity brand.
We're a family brand that sellsevery single day with the utmost
of quality.
(15:27):
And considering our retailersand our consumers, which is
extremely important, and ourretailers' confidence in us and
our consumers' confidence in us,they trust us.
And at the end, everybody wins,whether it be the retailer and
especially the consumer, andeven us as the manufacturer.
And I'm extremely content withthat.
SPEAKER_02 (15:46):
Yeah, dad, 100%, and you know, consistency going from
packaging to price point, allthese things.
We took a we went outside theindustry back in probably about
2014, going on 12 years.
We went outside the industry andwe decided we wanted to emulate
the greatest company in theworld, Coca-Cola.
And we wanted to follow theirmarketing strategy and just in
(16:08):
terms of how they place theirproducts.
And one of the big emphasis forus is merchandising.
We're known for our beautiful,you know, prodomo walls.
And you know, I think one of thethings, and and there's always
more for us to grab, right?
And there's more that we aregoing to continue to grab in
retail stores.
And it's a big emphasis.
It's been a big emphasis for us.
But if you can, talk about theimportance of this the displays
(16:32):
that we have in retail storesacross the world.
SPEAKER_01 (16:35):
Well, what we want to do is we want to we think it
helps the retailer move theproduct more quickly.
We also believe it helps theconsumer with the ease of
shopping to be able to find ourproducts at a much quicker clip
because of the beautiful colorsand that Perdomo Mystique and
finesse that our packaging has.
I think it's extremely importantthat in majority of the
(16:56):
retailers, the best retailersaround the world, that we have
eye-level placement that'sextremely important for our
consumers and for us.
And clean clean displays, in mypersonal opinion, help consumers
buy with ease.
And that's where I bring backthe ease of shopping.
And I'm proud that every Perdomawall is always clean.
(17:16):
And I'm proud of our not onlyour sales team around the
country who really looks atevery single detail, whether a
shelf talkers folded, but allthe beautiful planograms our
guys do in Miami to assist oursales team and to assist our our
retailers.
And at the end, you know whowins?
The consumer.
And that's who we're fightingfor every day.
SPEAKER_02 (17:34):
100% that but you talk about ease and really the
ease of you know, even retailerswhen we talk to them, they feel
an ease.
They tell me, man, you know,ever since I merchandised and
ever since I placed your productthis way, even control my
inventory, just being able torefill boxes, because I know
where everything's at,everything's perfectly aligned,
(17:54):
perfectly set, and I'm able toI'm able to fill up my backstock
easier.
I'm able to show and and sell myyou know my customers because I
know where everything's at andeverything's so organized.
So ease is really a big word.
And you know, vertically, andyou know, everything's about
been about vertical.
And you know, dad, beingvertically integrated is
(18:16):
everything.
It is a sacrifice, yousacrificed, and I can tell you
personally from a personal levelas a kid, there were a lot of
days you were gone because youwere beating the shoe leather in
the road, trying to sell ourcigars in order to become
vertical.
And you spent weeks on end withmy grandfather in Nicaragua
building facilities, purchasingfarms and things like that.
(18:37):
So it wasn't just, hey, I took aloan and I I bought I bought
some farms, no way.
And you you really there was somuch that went into it.
And you know, it buildsvertically integrate being
vertically integrated iseverything.
You know, it builds loyalty, itbuilds trust, and that's where
we have that's due to us beingconsistent, but we focus on the
core brands, proper selling, thebest price points, packaging,
(19:00):
merchandising.
And this is our pronomalformula, and that's really and
it's something we're reallyproud of.
SPEAKER_01 (19:06):
Yeah, it's a tremendous amount of work.
Someone had brought a lettersaying that they had seen
someone saying that new brandsshould be given the best
placement, and brands like oursand a couple other famous big
brands should be on the floorbecause our brands sell.
And I had to laugh at theignorant comment because when I
started selling cigars, I wish Iwas on the floor.
(19:28):
Back in those days in the early90s, when you had all these
massive companies controllingall the the humidors,
deservingly so, because theyworked hard at it, and I had to
respect that work and I had toearn it.
Okay, that's that's a big point,earning it.
I was lucky if I was on thefloor.
I was usually put in thebackstock or behind the humidor
(19:49):
till there was a placement whereI could get a box of my cigars.
If I could get a box of mycigars on the floor, I was
really happy.
You get what you deserve withthe amount of work, and I want
to thank every one of you outthere, the consumers and the
retailers who've supported us,but you guys all know the amount
of work our family did fordecades to build our brands.
It was done through quality, itwas done through trust, but it
(20:10):
was done through a lot of hardwork.
SPEAKER_02 (20:12):
You mean you weren't given it?
SPEAKER_01 (20:13):
No, I wasn't given it.
It was a lot of hard work, and Inever said you should give me
the best shelf space, and allthese brands that did a great
job at their time should be puton the floor.
No, it to me it's insulting.
You get what you deserve, and itgoes through a lot of hard work.
And for us, you know, I look atit as it's all about the
fundamentals at Perdoma Cigars,about doing the things right,
(20:37):
producing consistent, greatcigars each and every time with
incredible packaging, and reallythinking about the consumer and
the retailers' need.
And it's how we build brandsthat have lasted for decades,
and my hope, and with the helpof God for generations to come.
Yeah, don't worry, Dad.
SPEAKER_02 (20:55):
We'll take care of it.
I trust you wholeheartedly.
I appreciate it, Dad.
Well, Dad, this was a greatshow.
I'd like to thank our audience.
I really appreciate the support.
We have a lot more to go, andthis was a great conversation.
Dad, thanks again.
Thank you guys, and thank youguys very much.
If you enjoyed this, please likeand subscribe and hit the
notification button on ourPerdomo YouTube page.
(21:17):
Also follow us at Perdomo Cigarson Instagram and Facebook.
We will see you very soon.
Thank you so much.
Thank you guys.
We'll see you soon.
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