Almost 7 years ago, Davidoff of Geneva partnered with the owners of Corona Cigar Co. to open the only licensed Davidoff location outside of Las Vegas. The “Davidoff of Geneva—Since 1911” Flagship store in Tampa was branded like other Davidoff properties while being owned/operated by Corona’s Jeff and Tanya Borysiewicz. Anyone who walks into that shop today, and every day moving forward, will now be walking into a Corona cigar shop – according to a piece published by Tobacco Business, Davidoff and the Borysiewicz’s have officially ended their sometimes tense partnership.
While it will still be a Davidoff Appointed Merchant, this is a big and sudden change. For those new to cigars or those who focus on boutique brands and don’t smoke a lot of Davidoff, the significance of this news could easily fly under the radar. However, if you step back far enough and take a look at all the recent developments, there is an obvious shifting of the tectonic plates beneath the cigar industry.
Davidoff just recently announced that revenue was up 8% and that they’d rolled 31 millions cigars last year – so it would appear that at least that segment of the larger Oettinger Davidoff AG is not struggling. In the face of that growth, one would imagine a flagship store in the middle of one of the largest cigar cities in the world would be an ideal placement. Since little detail has been provided beyond generic joint statements, one wonders which of the two parties sought to end the partnership.
Corona is actually opening yet another location soon, this one a flagship in Sarasota – so was the Davidoff branding no longer benefitting the Corona owners as much as it once was? Will Davidoff open their own location in Tampa, one that they own outright? It could also end up being that it was completely mutual and just the end of a good run, but the timing of the announcement is certainly intriguing.
Look at it from this perspective. Scandinavian Tobacco Group spent $20,000,000 upgrading its warehouse operations and is actively partnering with more and more boutique legends like Illusione’s Dion Giolito and Room101’s Matt Booth – acquiring the latter’s entire cigar brand and retaining Booth as Creative Director. Arturo Fuente is breaking ground on a new factory in Nicaragua. These are, collectively, a huge deal. These large companies pay top dollar to know for certain how much every moment of effort is worth. There are profit and loss statements. There are projections. There are boards that vote. All of those people are rushing to get more cigars produced as fast as they can.
If anyone thinks this third cigar wave has already reached the high-water mark, then it would appear that nobody has told these companies who are spending tens of millions of dollars to get more product into the marketplace.
What’s your take? What do you want the future of the industry to look like? We’d love to talk with you about it in the comments below!