Gray Market


edameff

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Hello,

I have been buying Habanos for about a year off of various websites (prior to finding this forum), and I am a little confused. I know that only certian distributors are legit from Habanos SA, yet anyone can claim to be an authorized retailer. Who can actually buy from these authorized distributors? I have several boxes that have double seals, one over the other, I have been told this is nothing to worry about but I wonder if these were "rejected" by certain retailers and then resold. On Rob's EXCELLENT video explaining the PSP program he rejected a box as garbage and stated he would return it. What happens to this box, does the distributor simply sell this to some other dealer? Does any specific distributor have "first pick" like Spain etc.

I know these are many questions but I am very eager to learn and this is the place to do that!

Thanks

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Others here will be able to answer you questions more authoritatively than I.....

With regard to gray market or parallel importers, generally speaking it's a distributor or retailer acquiring cigars from outside their assigned

regional network. As long as everyone knows everyone else in the supply chain, it can be safe - buyer beware.

It can also manifest itself as drop shipping. You purchase your cigars from a dealer in country x, but the cigars are actually shipped from a

warehouse in country z. Both are legit dealers and you save a few drachmas, but more than likely, a box is grabbed from inventory, packaged,

and shipped - without the benefit of the original dealer having any control over quality.

P.S. one of my favorite Buffett songs is Altered Boy.....

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My Favorite is False Echos, with Havana Daydreamin' next, both are my top stogie songs. Nothing on earth like listening to this, lighting up a Cohiba Reserva, and watching the sunset over the Caribbean ocean while eating a fresh lobster you just caught...Just kill me now, I don't need anything else!!!

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Others here will be able to answer you questions more authoritatively than I.....

With regard to gray market or parallel importers, generally speaking it's a distributor or retailer acquiring cigars from outside their assigned

regional network. As long as everyone knows everyone else in the supply chain, it can be safe - buyer beware.

It can also manifest itself as drop shipping. You purchase your cigars from a dealer in country x, but the cigars are actually shipped from a

warehouse in country z. Both are legit dealers and you save a few drachmas, but more than likely, a box is grabbed from inventory, packaged,

and shipped - without the benefit of the original dealer having any control over quality.

P.S. one of my favorite Buffett songs is Altered Boy.....

Colt

Does this explain why a retailer will remove the serial number from the new warranty seal?

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Others have pretty much answered your question, Gray Market or Parallel Vendors are those that purchase some or all of their inventory outside the Authorized area for which they are geographically located. Say a vendor located in England and buys product from a Distributor located in Mexico. In this example, the Gray Market vendor may obtain better prices and terms than buying from his authorized distributor. A Gray market is also suspect to buying from other distributors which may find that some Fake Cuban cigars get into their inventory. While I have done business with a very select few Gray Market vendors, it is because they earned my trust. The issue is that you can never be 110% sure that what you bought is Authentic Habanos. Cigar Czar is a Authorized supplier of Habanos s.a. because he sources all of his inventory from Pacific Cigar Company, whom is the Authorized Habanos Distributor for Australia. A vendor that is honest will answer any and all questions about where the providence of the cigars come from. A vendor that will not share where their inventory comes from is probably a Gray Market vendor. Being able to trace the channels of distribution all the way back to Cuba is important to many people because they then know that what they spend their money on is in fact the real deal.

Double seals, interesting question. If the second seal has a XX or a XY of the beginning numbers of the seal, it means that the box has been opened and checked by someone from Habanos. This is a box of Reviso. The box like this has been re-inspected for quality. Over the past year Habanos has also started using a New, you may want to do a search here because FOH was the First to Break the news to the Cigar World. I encourage the use of the Search function, it will a surprise about all the information we have on the forum.

http://www.friendsofhabanos.com/forum/inde...l=Warranty+Seal

There is no difference between Habanos that are shipped to the Authorized Distributors. Pacific Cigar Company receives the same quality cigars as Hunters & Frankau.

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I was pleasantly surprised the other day when I received a package from one of my gray market vendors with the bar code and serial number still attached to the new seal! Not only that, but the serial number checks out perfectly on the Habanos.com website with the exact brand, vitola, and packaging information.

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Ive never purchased gray market, but I hear that just because the origin of the cigars is questionable, doesnt mean they are fake. However, the box that you are getting is likely to have not been inspected for actual quality.

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Hi

Interesting thread. I purchase from both gray and white (?) market vendors, mostly with satisfactory results. A question that seems important is the influence of rejecting the below par boxes by the vendor, which Czar is known for doing. What is the impact on stock's cost for the retailer, as it seems logical that more selective retailers bear a higher cost than ones beeing less picky about the quality of their goods. And I've seen some very poor quality boxes coming from vendors who do inspect their goods, so I suspect some of those are less selective than Czar, but surely they would be more selective with what they receive if they thought they could afford it ... Next question is what happens to those rejected boxes ? Rob talks about them going to the restaurant/hotel market, but this market can't be too big, especially with all the anti smoking laws. Are they massively resold to the discounters/gray market dealers, which would sound logical - yet in practice their regular stock often -definetely not always- looks decent and is mostly made of unopened boxes -i.e. uninspected boxes that have apparently been rejected by no one yet.Do you know what percentage of received stock is rejected by Czar, or retailers in general ?

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That would be a question that could best be answered by the Prez on his return from the "Promised Land," at least for Cuban cigar smokers...

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Hi

Interesting thread. I purchase from both gray and white (?) market vendors, mostly with satisfactory results. A question that seems important is the influence of rejecting the below par boxes by the vendor, which Czar is known for doing. What is the impact on stock's cost for the retailer, as it seems logical that more selective retailers bear a higher cost than ones beeing less picky about the quality of their goods. And I've seen some very poor quality boxes coming from vendors who do inspect their goods, so I suspect some of those are less selective than Czar, but surely they would be more selective with what they receive if they thought they could afford it ... Next question is what happens to those rejected boxes ? Rob talks about them going to the restaurant/hotel market, but this market can't be too big, especially with all the anti smoking laws. Are they massively resold to the discounters/gray market dealers, which would sound logical - yet in practice their regular stock often -definetely not always- looks decent and is mostly made of unopened boxes -i.e. uninspected boxes that have apparently been rejected by no one yet.Do you know what percentage of received stock is rejected by Czar, or retailers in general ?

My uneducated opinion is that the number of boxes rejected by vendors that have issues other than mold, maybe beetles or something very dramatic would be a relatively small percentage. I just don't believe most vendors send back otherwise perfectly good boxes in any significant quantity just because of other issues. And if these issues were severe, who could they resell them to?

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  • 3 weeks later...

This is a very interesting an informative thread. I've purchased CCs through a couple different gray market shops on the internet... and have been lucky enough to get stuff. However, every time I've done it I've been pretty worried.

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Hi

Interesting thread. I purchase from both gray and white (?) market vendors, mostly with satisfactory results. A question that seems important is the influence of rejecting the below par boxes by the vendor, which Czar is known for doing. What is the impact on stock's cost for the retailer, as it seems logical that more selective retailers bear a higher cost than ones beeing less picky about the quality of their goods. And I've seen some very poor quality boxes coming from vendors who do inspect their goods, so I suspect some of those are less selective than Czar, but surely they would be more selective with what they receive if they thought they could afford it ... Next question is what happens to those rejected boxes ? Rob talks about them going to the restaurant/hotel market, but this market can't be too big, especially with all the anti smoking laws. Are they massively resold to the discounters/gray market dealers, which would sound logical - yet in practice their regular stock often -definetely not always- looks decent and is mostly made of unopened boxes -i.e. uninspected boxes that have apparently been rejected by no one yet.Do you know what percentage of received stock is rejected by Czar, or retailers in general ?

We try to move below standard stocks through the wholesale chain. It is not too difficult with those cigars that move readily (Monte 2/D4/Cohiba Robusto etc. Those that are what we would consider specialty stock (Winstons/Esplendidos etc) we simply return for a credit.

We have a good relationship with our distributor. If we paralleled we would not be able to do so.

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