CIGARS: J. CORTÈS
“Now we can truly call ourselves a global cigar player.”
Frederik Vandermarliere, CEO, J. Cortès
J. Cortès' travel retail sales are growing in the Americas, Asia and Europe
regulations in travel retail. A display ban is of course very bad for our sales and with
J.Cortès & Oliva cigars we produce and offer our clients legal and exclusive quality products. As long as cigars are legal the industry should try to protect the way we market our products.
Are you finding retailers are offering you flexibility with regards to POS and merchandising in-store? TG: Retailers are demanding support with promotions and in-store activities where it is legally allowed. We also work with sales ambassadors because it is a very effective way to support airport personnel and increase sales. Unfortunately, it is not possible in all regions and the cost is quite high in comparison with the reached volumes. Cigars are a niche market with a high-level consumer, but the number of cigars bought per passenger is rather low. On the other hand, the value per purchase is high.
The flavour segment continues to rise in appeal and while cigars are currently exempt from some of the strict rules applicable to EU TPD, is there a threat that these could be lifted if sales of flavoured cigars rise? TG: With the Neos Flavour
Collection we have both flavoured and non-flavoured cigarillos in our travel retail portfolio. Although there are today no signs of a flavour ban for cigarillos, we build with our Neos Flavour collection strong brand awareness and availability, which will help the brand to survive, even
SEPTEMBER 2018
without the flavours. J. Cortès is also working hard to follow cigar trends in Europe, Asia and US. There is an increasing interest from retailers and consumers for premium cigars, new world cigars and limited editions. The next generation cigars lovers
are seeking more variation and explore the cigar world by trying cigars from Cuba, Nicaragua, and Dominican Republic and are not fixed on one terroir.
It’s been two years since the Oliva acquisition. How has J. Cortès developed the brand and what has Oliva received in return? Frederik Vandermarliere, CEO, J. Cortès (FV): We are still living the dream as long-standing cigar makers. The biggest achievement is the fact that we were able to keep the group together: Nobody in Nicaragua and the US Oliva team left us. We still have full support from some members of the family and the management team is doing a fantastic job. We continue growing, but without touching the heart and soul of the company and its quality. From our side, we invested tremendously after the acquisition: A new state-of-the-art box factory, new rolling tables and chairs and better accommodation for the tobacco in fermentation to support growth. On top of that, we use our international network to let Oliva and Nub grow much faster internationally. Now, we can truly call ourselves a global cigar player.
Acquisitions of small, family- owned cigar companies has
become a common thread over recent years, with Oliva, Gryson (JTi) and Torano (Scandinavian Tobacco Group). How do you as a company balance respect for a brand’s provenance and roots (i.e through the cigar making process) with the ever- challenging requirement to satisfy bottom-line finances? FV: Firstly, the biggest difference is that we, as a family-owned business, bought a family-owned business. Of course, bottom-line finances
are important to be able to survive in the long run, but we have to admit that we can look much further in the future than the next quarter. On top of that, I have to say that the brand’s provenance and roots are the same as ours: we’ve made cigars for 90 years, machine made, but with very old recipes and respect for the product. We have two- to three-year stocks
of tobacco. No banker is happy with this, but we know we need it to make consistently great cigars. Finally, we do it with passion and pleasure. «
J. Cortès' travel retail sales are growing in the Americas, Asia and Europe.
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