Cigar importer and producers help Dutch tobacconists. The largest independent importer of premium handmade cigars, Longfiller Company, is helping Dutch tobacconists through the covid-19 crisis. And they are doing that with the help of five brands. Something that we support, earlier we already plead to help the independent, family-owned tobacconists and brands.
Longfiller Company is owned by Sasja van Horssen, who is also known for the world’s first all Nicaraguan cigar shop Cigaragua and his upcoming Fuente exclusive store in Amsterdam. But his bread and butter is the import and distribution of premium longfillers from Nicaragua, Honduras, and the Dominican Republic. Van Horssen shared a poster on Facebook with the text “Brothers of the Leaf vs Corona, supporting our retailers”. The poster (pictured below) also showed Nestor Plasencia, Rocky Patel, Juan Martinez (Joya de Nicaragua), Fred Vandermarliere (J. Cortes/Oliva), and Tom Mulder (La Sagrada Familia). After seeing the poster, Aitor Zapata from Condega Cigars reached out to Van Horssen. Condega will be part of the initiative too. Just like PDR Cigars, Abe Flores joined as well.
The poster asked for more detailed information, so Ministry of Cigars reached out to Van Horssen. In a phone interview, Van Horssen explained more. “It is important to know some basic information on how the system works in The Netherlands. We work with fixed prices. I, as the distributor, set the price based upon my purchase price, plus taxes and margins. Tobacconists can only sell the cigars at a fixed price. Retailers are prohibited from competing on price with this system” Van Horssen started.
He continues “and to get the cigars to the consumer, you need 3 parties. The manufacturer, the distributor, and the retailer. And the retailer is financially the weakest link in this chain. Where the manufacturer sells 10 million cigars yearly, the distributor might sell a million. And the retailer sells 10.000 cigars. So it’s clear that we need to support our retailers to keep the chain intact. To do so, I reached out to five of the brands I represent in The Netherlands with a plan. A plan to share the wealth, and offer retailers some extra margin during these hard times”.
Extra margins and terms of payment
The Longfiller Company already extended the terms of payment with two months for the tobacconists in The Netherlands. And offered special deals with extra margins. But that wasn’t enough according to Van Horssen. So he came up with the plan and approached his suppliers. “Cigar manufacturers and distributors have more meat on the bones than retailers. So it is ethical to bare a bigger part of the load of the corona crisis than our resellers” Van Horssen said.
“I approached five of my partners with a ‘take it or leave it’ offer. I would place a big order, but in exchange for that order, I want an x percentage of discount. For this order, I will lower my distributor margin. Those discounts will result in a much lower buying price for the retailer. With the fixed price system, that leads to a much bigger margin for the tobacconist. An extra margin of approximately 35%. I will open the books for the orders, so the manufacturers are certain that the retailers are the only ones profiting from this initiative”. Van Horssen also said that he is planning to do this for three months minimum, but will prolong the support if the situation demands it.
All the boxes that are included in this initiative will be labeled with an extra sticker. That sticker makes it clear to retailers and consumers which brands stuck out their necks to help the tobacconists through these crazy times.
“Longfiller Company is representing more brands than these five. But I contacted Rocky Patel, Joya de Nicaragua, Plasencia Cigars, J. Cortes/Oliva, and La Sagrada Familia first. Condega cigars reached out to me. After the initial Facebook post, Abe Flores also contacted me to be a part of this. I will reach out to the other partners as well. But I didn’t want to wait with this relief fund until I reached out to all my suppliers. I wanted to start as soon as possible, so retailers can get some room to breathe.” Van Horssen continued. “In times like these, we need to stick together. When I see that La Flor Dominicana fires half of their sales representatives, I am appalled. That’s not how you treat people. We need to take care of each other in tough times.”
Van Horssen said he hopes to add more brands to the Brothers of the Leaf vs Corona initiative next week. He’s also pushing the idea to distributors in other countries, hoping that more initiatives arise to support tobacconists all over the world. “There are importers/distributors everywhere that talk the talk, but don’t walk the walk. We see that in The Netherlands, and we see that in other countries. Now is the time when retailers see who has their best interest at heart. Are the brands that invite you to parties during good times, but leave you to hang to dry in the bad times your friend? Or is it the distributor that doesn’t host parties, but helps you through the rough times?” Van Horssen asked. He also explained that it’s a ‘take it or leave it’ offer is for his partners. The offer he’s asking for this initiative is non-negotiable.
Responses from participating brands
Ministry of Cigars reached out to the brands involved in the initiative. Tom Mulder from La Sagrada Familia responded immediately. “I believe in sharing with the people close to you, in good times and in bad times. Now that we see that retailers are hit disproportionally, it is common sense that we should reach out and help. So when Sasja approached me with this idea I didn’t even have to think about it. La Sagrada Familia is in. It is in everybody’s best interest that our retailers pull through these uncertain times.
Fred Vandermarliere from J. Cortes/Oliva said “When Sasja approached us, we didn’t hesitate a single moment. It is fantastic to see how inventive Sasja is. He showed that with Pronica, and now with this initiative. You can just wait until this blows over, but no, he gets up and sends out a positive signal. We support that. In these bizarre times, where a lot of shops have to close, we want to show more than ever that we are here for our tobacconists. Whether we will do this in other countries will be evaluated case by case. Every country has its own response to the situation. In some countries, tobacconists are declared essential businesses and remain open. But as a family, we are close to our retailers, in good days and in bad days. Just like at home.”
Rodrigo Medina, Plasencia’s Regional Director EMEA replied “Plasencia Cigars has the strongest commitment to our retailers all over the world. The hard job we do at the fields and manufacturing means nothing without them. That is why we need to stand side by side today more than ever. Despite this uncertain times, our message to them is that we will get through if we stick together.”