And then it ends.
A week ago we published our 137th and final booth post from the 2018 IPCPR Convention & Trade Show. Today’s post is our annual recap of the show, which serves as the final post we will publish directly on the 2018 IPCPR Convention & Trade Show.
Three years ago I ended the trade show with a post indicating that we were going to fix how we covered the show. The feedback to the post was not stellar including some—err Brooks—arguing that the post never needed to be made publicly. I felt the opposite, namely that we needed to a. acknowledge that we could do better, b. then do better. I think we’ve done better in both 2016 and 2017, but this year was different and I hope you as a reader noticed that.
We still have some things to fix—we missed one booth that we shouldn’t have—sorry to Oscar Valladares, I’m not entirely sure what happened—but the coverage was as complete as it ever been. The trade show is always an interesting time for me personally. I am exhausted before it starts, excited to see the industry, but also very busy and only getting busier as the clock ticks by. That being said, there is nothing that shows quite like the show that shows why halfwheel is different than every other publication writing about cigars. The number of booths we cover, the manners (plural) that we cover them in and the speed at which we give you that content is something that I am very proud of.
Our team—Brian, Brooks, Heather, Kim, Patrick and myself—worked to bring you the best coverage of the IPCPR Convention & Trade Show possible. I hope you enjoyed it and don’t worry, we have already started for 2019.
As is tradition for this post, here are 10 thoughts that I have about the 2018 IPCPR Convention & Trade Show.
1.THE GREAT FIRE THAT WASN’T
While the fire—or more so the activation of the fire suppressant system thanks to an errant spark—early Sunday morning led to a change in our plans, I’m not sure it affected the outcome of what we did. Sure, there were some booths that probably would have been covered on Sunday that got pushed until Tuesday. It also changed our dinner reservations and a few other things, the content that went to the site is probably close to what it would have been regardless, and by the time you are reading this conclusion post, the differences that the fire could have caused are quite minor.
And I think that’s how it went for most companies. Yes, the fire changed how Sunday went. Yes, it provided some disruptions. Yes, it was annoying to be up and ready to go only to be delayed for a few hours. And yes, for the booths close by and even some far away, it was certainly not fun.
But no, I don’t believe any company’s overall IPCPR Convention & Trade Show was affected substantially by the fire. Plus a lot of people got to watch the World Cup final.
2. WHEN DOES THE IPCPR STOP MANUFACTURERS FROM ATTENDING WITHOUT A BOOTH?
I saw a handful of manufacturers—Cabal, Casa Cuevas, Flor y Nata, Maya Selva, Ohana—walking around the IPCPR Convention & Trade Show floor without booths. I’m not sure if all of them were taking orders, but some of them were and that seems like an impending problem.
Without the prospect of opening new accounts—something that is certainly reduced each year a particular company is both established and at the trade show—I’m not sure how you incentivize smaller companies to spend the substantial costs for even a small 10 x 10 booth if you can alternatively get a badge, meet with your sales brokers—most of whom are there for other companies—and host meetings in other people’s booths or the food courts.
There’s not a great solution here and policing it would be nearly impossible, but I do think the IPCPR needs to attempt to address the issue as it seems likely to only get more and more out of hand.
3. LINE EXTENSIONS GALORE
More so than any other year, it seems like companies were introducing line extensions, oftentimes in the form of a single new limited edition size. Yes, General Cigar Co., Drew Estate, Micallef, Royal Agio and a few others certainly added a plethora of new SKUs in the form of full-fledged, multi-vitola regular production lines, but they were the exception to the rule this year.
I think this is a natural progression to something I’ve written about before: there are way too many different types of cigars on the market.
Special shout out to Felix Assouline who released more SKUs than anyone else, perhaps we will make a trophy for that.
4. SCOTT PEARCE’S DEBUT
This was the first show for Scott Pearce, the new executive director of the International Premium Cigar & Pipe Retailers Association. Given he didn’t start until May 7, Pearce admitted he didn’t have much to do with this trade show. However, he acknowledged that he was already making notes on things that need to be looked at for the future.
Pearce was hired for a number of reasons, chief amongst them to help improve the IPCPR as an organization and its relationship with its members. One of those areas that was certainly a deficiency was the presence of IPCPR leadership visiting exhibitors. From my limited sampling, I can say that I saw Scott Pearce visiting booths a lot more than either of his two most recent predecessors.
In addition, he and the rest of the IPCPR stuff deserve a lot of credit for the relatively limited impact the aforementioned fire had on the trade show.
Overall, I think the new IPCPR leader gets good marks for his first trade show.
5. THE DWINDLING TOPIC OF FDA
Once again, I don’t recall having that many conversations about the U.S. Food & Drug Administration’s (FDA) regulation of premium cigars. This, despite the fact that the cigar industry was rather close to having to put warning labels on boxes beginning Aug. 10, despite the fact that many companies had been redesigning boxes to better display warning labels and despite the fact that the most recent relief is likely temporary.
While it is likely that it will be at least another year for the court system to take its next big step in regards to the regulations, there is something looming in the immediate future: the bill.
The joint lawsuit filed by the Cigar Association of America (CRA), Cigar Rights of America (CRA) and the International Premium Cigar & Pipe Retailers’ Association (IPCPR) is not cheap. It has already costs of millions of dollars and it will cost millions more to go through the appeals process.
Paying for that lawsuit is convoluted and disputed, but the legal bill is quite clear and large.
I think it’s very likely that the discussion of the actual legal proceedings will take a backseat to the industry’s internal discussion of how to pay for the legal process, which is already somewhat disputed and probably getting more complicated.
6. NEW PRODUCTS ARE COMING TO SHELVES A LOT QUICKER
There was a time when certain companies—Arturo Fuente and Drew Estate come to mind as the two most prominent examples—would attend the trade show with new product, but no confident estimate of when the product would ship. Drew Estate admittedly fixed that problem a few years ago and began shipping products nearly immediately after the show, but it seemed like more products than normal were shipping in either July or August.
My guess is there are probably two explanations for this shift:
A. There’s less new product — Very few companies had more than a dozen new SKUs. Most companies stuck with a single new line, if that, and a few limited editions or line extensions. As such, there is a lot less to manage and a lot less to go wrong in terms of displayed packaging, etc.
B. FDA’s Original Warning Label Date — I have to imagine that the original Aug. 10, 2018 warning label date, which has since been placed on indefinite hold, meant that a lot of retailers wanted to ship products in July before the date went into effect. There are also some more complex strategies where some companies overloaded their warehouses prior to Aug. 10 due to a provision that would have allowed them to sell those items without warning labels even after Aug. 10. Of course, that’s not particularly relevant now, but I imagine it played a role in why we are seeing earlier shipping times.
7. YOU WILL SEE SOME WARNING LABELS
Despite the delay for the Aug. 10 warning label implementation, the big warning labels aren’t going completely away. I don’t recall seeing any of them on display—and our pictures would suggest the same—but that doesn’t mean they are not going to stores. Two large companies—Drew Estate and General Cigar Co.—are likely to continue shipping new product with warning labels despite the fact that the requirements for warning labels have been delayed.
The reason behind this is that the larger companies had both produced product with the warning labels in anticipating of the Aug. 10 date. That product, which was already made, would then have to be repackaged without the warning labels, which would in turn cause a delay.
General Cigar Co. says that it will eventually shift back to the smaller FTC-required warning labels, but that it has to cycle through existing product with the larger warning labels in the mean time. Drew Estate has not returned a request for clarification about whether it will move back to the smaller warning labels.
Of note, both of these companies are part of the FTC consent decree that requires certain companies to have warning labels. Most cigar boxes will continue to have no outside warning labels.
8. A LOT MORE CELEBRITIES
There always seems to be a few celebrities at the IPCPR Convention & Trade Show, but this year was different. While Rocky Patel’s collaboration with sports stars has brought a few notable celebrities, this year saw some people, notably Rick Ross, at the trade show without any business reason. In addition to Ross, baseball legend Pete Rose, basketball hall of famer Karl Malone and football star Ed Reed were in attendance. In addition, Arturo Sandoval and his trumpet were present in the Arturo Fuente booth, a relatively common occurrence.
9. THE SCHEDULE VS. THE VENUE
The IPCPR, the organization, needs to get feedback from both the exhibitors and attendees about preferences for schedules and a lot more things. While everyone seems excited to return to the Venetian/Palazzo/Sands Expo Center next year, no one seems excited about next year’s schedule, which moves the trade show to just before the 4th of July holiday, one of the busier times for most cigar retailers.
Unfortunately, as if that wasn’t enough, it didn’t seem like this year’s schedule—starting on a weekend—did much to boost attendance and Day 3 had a noticeable drop off in attendance. I think it’s safe to say that most people—including the IPCPR themselves—would prefer the show be later in the summer, though my guess is if the trade show wants to be at the Sands, it’s going to get undesirable dates.
Something should be done to try to figure out what the days of the week should be as the Saturday start doesn’t seem to be the answer. There should also be some survey to figure out people’s preference on whether it’s more important to have the show at a better venue, but worse time or to have a worse venue, but better timing.
Like with many IPCPR-related complains, better communication could solve this or at least give the IPCPR the ability to say, “we asked you and 60 percent of you said they wanted it this way.”
10. PRICE INCREASES ARE HERE TO STAY
More so than any other year, cigar companies were honest about how their respective shows were going. I suppose people finally realized that it’s hard to say that you are having your best show ever when there are four sales rep sitting around talking amongst themselves. Regardless, there’s zero indication that there are more shops—at the show or otherwise—or even a greater number of consumers buying cigars. As such, the price of cigars will continue to go up.
Two years ago I argued that the cigar industry was on a collision course with some market correction. That really hasn’t happened yet, though we saw more signs of it this year than ever before, notably, a lot more manufacturers not attending the show.
Regardless, I feel pretty confident in saying that regardless of how much it costs to make a cigar, companies will continue to raise prices as a way to offset slumping volume, added regulatory costs and potentially even increased manufacturing costs.
We covered 137 companies this year, one more than last year, links to the booths are below:
- 7-20-4 Cigars
- A.J. Fernández
- AGANORSA Leaf
- Altadis U.S.A.
- Alec Bradley
- American Caribbean Cigars S.A.
- APS Distributors
- Arango Cigar Co.
- Arturo Fuente
- Battleground Cigars
- Berger & Argenti
- Bespoke Cigars
- Blue Mountain Cigars
- Boutique Blends
- Brizard & Co.
- Casa Turrent
- Chinnock Cellars
- Cigar In The Bottle
- Cigar Oasis
- CLE Cigar Co.
- Cornelius & Anthony
- Crowned Heads
- Daniel Marshall
- Dapper Cigar Co.
- Dav Cigars
- Davidoff of Geneva USA
- De Los Reyes
- Debonaire House
- Dominican Big Leaguer Cigars
- Dominion Cigar Inc.
- Drew Estate
- Dunbarton Tobacco & Trust
- E.P. Carrillo
- EH Cigars
- Elie Bleu
- Espinosa Premium Cigars
- Esteban Carreras
- Falto Cigars
- FDG Cigars
- Felix Assouline
- Foundation Cigar Co.
- FQ Cigars
- Garo Cigars
- General Cigar Co.
- Global Premium Cigars
- Gran Habano
- Hiram & Solomon
- Island Lifestyle Importers
- J.C. Newman
- Jas Sum Kral
- Jeremy Jack Cigars
- Joya de Nicaragua
- JRE Tobacco Co.
- La Aurora
- La Barba
- La Flor Dominicana
- La Galera
- La Palina
- La Sirena
- La Sonrisa
- La Tradición Cubana
- Leaf by Oscar
- Lotus Group/Integral Logistics
- Miami Cigar & Co.
- MLB Cigar Ventures
- Mombacho Cigars S.A.
- My Father Cigars, Inc.
- Nat Sherman
- Nomad Cigar Co.
- PDR Cigars
- Phillips & King
- Pier 28
- Plasencia 1865
- Porsche Design
- Potter Cigars
- Quality Importers
- Rabbit Air
- Rocky Patel Premium Cigars, Inc.
- RoMa Craft Tobac
- Royal Agio Cigars
- Sans Pareil / La Instroctura
- Selected Tobacco S.A.
- Serino Cigar Co.
- Sinistro Cigars
- Southern Draw
- Tabacalera El Artista
- The Traveler
- Topper Cigar Co.
- Total Flame
- Vector KGM
- Villiger Cigars North America
- Vintage Rock-A-Feller Cigar Group
- Visol Products
- Warfighter Tobacco Co.
- Whiff Industries
- White Hat Distribution
And for those wondering about the name of this post. Brooks, this is Future.