As CEO, What would you do with Non/Slow Selling lines?

[MrBirdman]

12 hours ago, Li Bai said:

I have a question for you @El Presidente, how representative of the typical CC smoker are we FOHers?

In other words, what was the percentage of genuine connoisseurs among CC buyers before 2022 and what is it now (give or take)?

I think we are reasonably aligned with CC smokers historically, though more enthusiastic. The “we” here is the active FOH membership - I’m sure there are a lot of silent members who just buy on 24:24. However we’re certainly not the new target audience for Habanos, since we care about the actual cigars more than the paper bands on them.

[cigaraholic]

I’d just raise the price, there’s no shortage of people that think the most expensive is the best. And there’s no shortage of people that don’t care how good the cigar is, just how good they look smoking something ultra expensive.🎃

[MrBirdman]

If the HSA luxury rebrand is going to work, they can’t start dropping prices. It’s a long-standing rule in that market that dropping prices usually hurts your brand’s standing as a luxury good. Sadly, since this isn’t what I would want, I would reduce production and redirect the resources to special editions in the marca or higher demand cigars where possible (allowing that tobacco for one cigar isn’t always fungible across all blends or other lines). Combine this with a freeze on price hikes for the poorest sellers which you will not/cannot D/C (e.g. Monte 4). The only cigars I would possibly drop prices on are the half coronas - even within HSA’s portfolio, they represent abysmal value for the smoking time/quality (which I find to be very inconsistent). 

Worth noting that, even if they did drop prices on some cigars, I still wouldn’t buy any right now following the recent prison labor revelations. Strictly speaking personally, I see no point buying a cigar I won’t be able to enjoy smoking. 

[cnov]

On 11/1/2025 at 1:09 AM, JDoughty said:

Because then you lose the perception of Cuban cigars as a high end, hard to get luxury item. It is a better fit for Cuba's circumstances and limited resources to sell a smaller amount of cigars for more money to the very wealthy and status seeking, keeping prices artificially high, than it is to ever allow any to be sold at a discount. It sucks, but the financial reality for them is that I do not think they have the resources to put out consistent mid range product to the average consumer, and they will make more money with less production if they keep prices artificially high and supply artificially low. Even if it means they have to destroy some cigars. Which is very unfortunate, but it is the economic reality for them as it stands with a damaged infrastructure and constant brain drain outside of prison labor. I suppose we can volunteer to set all those unwanted cigars on fire to help them out, but it probably won't get us anywhere. 

I disagree with this, many top flight companies have different levels of service. 

How are they going to train their new rollers without getting them experience in the first place? With any hand made product you will have different levels of skill at every turn. If for instance they are can pull off Cuban cigars being just a "high end luxury" item, how are they going to maintain that if half the cigars are plugged? Normal marcas could be better priced and be an area of the business that offers training up skills and jobs. When these rollers get good, they can then roll the truly premium. 

Surely smokers are also in decline, if you want to be selling billions of $ of cigars, you want to be pulling money from of many sectors of the market as you can, to put all the eggs in one very fancy, velvet pouched, high gloss finish box could ruin half of your core market. We could currently also be in a situation where cigars are in vogue, but that could pass as it has done in the past.

[Arabian]

Quote

the bottom end such as mini/purito/Jose Pietra etc which are also doing very nicely

I think this is because many people can't afford long filler CC. They want a cheap Cuban taste for the day. Habanos reminds me of a story. It is said that a crow tried to imitate the walk of a dove but failed, and when it tried to return to its own walk, it had forgotten how. Seems they are lost. They want to be a luxury brand, target the middle-class and have short fillers for them people with tight pockets. You can't be Audemars Piguet and Timex at the same time. The low to middle-class people should've been the backbone of their customers. Those are returning customers. 

[JDoughty]

On 11/1/2025 at 10:29 PM, Arabian said:

I think this is because many people can't afford long filler CC. They want a cheap Cuban taste for the day. Habanos reminds me of a story. It is said that a crow tried to imitate the walk of a dove but failed, and when it tried to return to its own walk, it had forgotten how. Seems they are lost. They want to be a luxury brand, target the middle-class and have short fillers for them people with tight pockets. You can't be Audemars Piguet and Timex at the same time. The low to middle-class people should've been the backbone of their customers. Those are returning customers.  

Good points. This said, time is also a factor. If I want a cigar but don't have hours to properly savor and appreciate one, a little machine made or short filler Cuban cheapie, especially with some age on it, is a very tasty short snack! IMO the fun sized and lesser viiolas/marcas like Flor de Rafael Gonzalez Panatelas Extra, shorts or puritos have a place in anyone's rotation. They really hit the spot for an enjoyable quickie you don't have to think very hard about. I could make some analogies here to enjoying other pleasurable things in life, but in the interest of keeping it PG, I'll leave it to the imagination. 😁

[ATGroom]

There are two facts in this:

1. No matter what they do, Cuba does not have the ability to fill all the demand for their cigars at every price point. The don't have the tobacco and they don't have the rollers. They are working to increase both, but it will take a decade of great harvests and much improved economic conditions in Cuba for them to get anywhere near to ~150,000,000 cigars annually which is probably where total demand is.

2. The Linea lines are some of the highest margin cigars in the Habanos portfolio.

If you have limited capacity it makes sense to fill the demand for highest margin stuff first, which is what they have done. If someone wants a box of Linea Oro they can walk into pretty much any store in the world and get one. Now they will scale back production until it about matches replacement demand for these boxes and move any extra capacity into whatever the next highest margin cigars are.

For the retailers who have the stock gathering dust on their shelves - it's not a perishable product. If they can't move them in 2025 I'm sure they'll be able to in 2035 at twice the price.