Along with keeping an eye on the Food and Drug Administration’s (FDA) decision regarding the flavored cigar ban, retailers are also finding new ways to keep up with consumers’ demands and the different cigar trends they’re seeing.
Last year, the FDA announced the proposed rule to ban all flavors in cigars. As of now, the FDA still plans to finalize these rules by the end of this year.
“On Oct. 13, the FDA sent its final rule on the proposed ban on characterizing flavors in cigars to the Office of Management and Budget (OMB) for review. While OMB is supposed to complete its review in 90 days, it will not adhere to this timetable. The Cigar Association of America will meet with OMB to make the industry’s case,” said David Ozgo, president of the Cigar Association of America. “To promulgate a final rule, the FDA is required to show that the proposed ban directly addresses a specific problem.”
Ozgo also mentioned that even after OMB approves a final rule, there will be a period of time before it is implemented. That implementation could be delayed if there should be a legal challenge.
However, as retailers wait for that rule, they must continue to watch cigar trends and improve cigar sales in their stores.
Cigar Sales in C-stores
For the 52 weeks ending Oct. 8, cigar dollar sales slightly dipped by 0.1%, while unit sales dropped 3.1%, according to Circana, a Chicago-based market research firm.
Smoker Friendly, which operates 290 stores in 13 states, is one c-store chain that has seen a dip in cigar sales.
“For 2023, our overall company domestic cigar sales have been flat,” said Jeremy Weiner, category director of cigars and premium products for Smoker Friendly. “However, in a few of our markets, our sales are slightly down.”
“Through July 2023, large cigar imports were down 12.6% in volume, while premium cigar imports were down just 3.4%,” added Ozgo.
Cigar Trends
Natural-leaf cigars continue to be a trend for retailers to watch.
“Customers tend to be purchasing more of the natural-leaf offerings,” said Weiner. “Homogenized tobacco-leaf wrappers and filtered cigars have been losing sales the last couple of years.”
Nonetheless, some old trends and consumer demands continue to be a hot commodity in stores and with manufacturers.
“Major domestic cigar manufacturers still seem to be focusing on limited-time flavor offerings, and very few new items or brands were introduced in 2023,” said Weiner. “Many manufacturers have also added more non-flavor options to their portfolio, which I believe is to make sure they have items available if a flavor ban happens.”
Smoker Friendly stores offer a large variety of cigars for consumers to choose from, which allows the retail chain to keep up with the new trends and prepare for a possible flavor ban.
“Our stores offer anywhere from a four-foot to eight-foot section of domestic cigars,” said Weiner. “Our Smoker Friendly stores’ average domestic cigar set has about 180 SKUs of cigarillos, large cigars and filtered cigars.”
As 2023 comes to an end and 2024 begins, retailers will continue to organize their cigar section or backbar the way they see fit to improve cigar sales, keep up with trends and adhere to any cigar regulations that may come.
“In our stores, we are looking at SKU rationalization and discontinuing items that don’t have the sales value to warrant being on the cigar set,” said Weiner. “We continue to work with the manufacturers to offer monthly promotions and special deals to loyal customers.”