Cigar news: Breaking the mold of the cigar world.
He’s managing a boutique cigar empire—from Warrenville
Thanks to cameras on a factory floor in the Dominican Republic, Glen Case is able to operate Kristoff Cigars out of a suburban office park.
But in suburban Warrenville, Glen Case has set up headquarters for Kristoff Cigars in a little second-floor corner hideaway in a Cantera office building. No one is rolling tobacco on the premises, and of course smoking is expressly forbidden. But that hasn’t stopped Case, the 54-year-old owner and president, from building Kristoff into one of the fastest-growing brands in an industry notable for intense competition and mounting taxes and regulations coming from Washington.
When he got his start in 2004, Case hoped to buy a factory of his own in the Dominican Republic. Instead, he found an existing cigar production facility there, in Santiago, and ever since has had his tobacco rolled under contract. Case is the creator, however, traveling to his factory partner at least six times a year to come up with new blends while he tweaks older products. He sells two dozen labels, most of which are priced between $10 and $15 and sold in tobacco shops around the U.S. and in more than 30 countries overseas. Revenue approached $8 million in 2018, when he produced almost 2 million cigars, his best year yet. He employs three people in Warrenville and has 17 reps around the U.S.
Then there’s his marketing acumen. In his startup years, Case was on the road 220 days a year visiting with tobacco shops and their customers. He still travels 140 days a year. “Glen has worked hard to build his brand. He’s spent an exorbitant amount of time educating customers of mine and others,” says Ken Neumann, the co-owner of tobacco shops in Libertyville and Long Grove called Cigars & More who is also president of the International Cigar & Pipe Retailers Association in Washington, D.C.
The sales effort has been critical. Kristoff is still a small player in the premium U.S. cigar industry, which had a volume of 330 million cigars last year, according to Cigar Aficionado magazine. Two giants, General Cigar and Altadis USA, dominate the industry with nearly 70 percent of all sales divided between them. Some 300 other companies—Kristoff ranks just outside the top 10—divvy up what’s left.
Still, Kristoff has been gaining on its rivals. While industry sales are estimated to have risen 2 percent or less each year over the past decade, Kristoff’s volume jumped 15 percent in 2016, 9 percent the following year and 7 percent last year. “Kristoff has been around a while at this point and proven itself,” says David Savona, executive editor of Cigar Aficionado, based in New York. The company says it’s selling nearly 2 million cigars a year. “For most manufacturers 1 million a year in volume is a noteworthy goal to achieve,” Savona says.
There are fewer cigar shops around in most cities every year in the face of stricter no-smoking laws. Savona notes that cigars are banned not only in office buildings and restaurants in New York, but even outdoors in Central Park. In the face of these obstacles, the global cigar market is projected to grow at a rate of 8.1 percent between 2018 and 2022, according to Mordor Intelligence, with premium cigars experiencing the fastest growth.