Cigar News: State of the Industry – Major Manufacturers Decide to Bypass Major Trade Show

The PCA Trade Show

Hitting the news wires today, courtesy of Halfwheel.com, it is being reported that four of the top worldwide cigar manufacturers have decided to not exhibit at the 2020 Premium Cigar Association (PCA) trade show later this year. The list includes:

  • Altadis USA
  • Davidoff of Geneva USA
  • Drew Estate
  • General Cigar / STG

Last year, another large manufacturer, Villiger Cigars, pulled out the trade show.

According to a press release from Drew Estate:

Over recent years, an increasing number of retailers and manufacturers have come to recognize an unfortunate set of facts:

Our most important industry gathering – the PCA trade show – has been in decline.

Attempts to discuss ways to reverse the downward trends in relevance, attendance, membership, and category growth have been met with silence.

The cost of the event – which continues to rise – has consumed funds that could otherwise be used to defend our industry from regulatory and legislative attacks, which threaten the livelihood of each and every one of us.

This move is significant to the success of the trade show as whole, in so much as, these companies not only attended and had significant square footage at the show (big dollars) but also went above and beyond exhibiting, by dropping additional cash in sponsorship (signage, opening parties, annual meeting and breakfast, etc.)

The PCA (previously the IPCPR) trade show is the single most important way to raise funds for the Premium Cigar Association, which is a non-profit and established to be ‘the leading authority and advocate for the premium cigar and pipe retailer industry. Since 1933, the PCA has been dedicated to ensuring the current and future success of brick and mortar premium tobacconists.‘ Much of the funds raised by the organization is used to lobby political leaders on both the national and local levels to fight the ongoing legal battle against FDA regulations.

Last year, the PCA branded itself to provide a primary focus on premium cigars, they also rubbed many in the industry the wrong way, when they announced the idea of a consumer day (CigarCon) at the trade show. After much feedback, the PCA pulled back on the idea of CigarCon and announced they would form a committee to determine if, and how, such an event would be conducted. Both retailers and manufactures voiced their displeasure and it consumed the cigar media news cycle shortly after the trade show.

In a press release, from Drew Estate, the company noted:

After six months of repeated outreach to PCA, various efforts to discuss ways to enhance the structure, organization, and value of the show – for the benefit of retailers, manufacturers, distributors, and consumers – were unsuccessful.  Absent significant improvements, the trade show will continue its downwards spiral.  As “customers” of the trade show, it has become increasingly evident to each of us that we simply cannot continue to support and underwrite an event that is not satisfactorily responding to, or meeting, the needs of our industry.

Enter Tobacco Plus Expo

The aforementioned companies not only have pulled out of the PCA, but have endorsed and will be attending/exhibiting at the upcoming Tobacco Plus Expo (TPE 20) later this month, Jan 29-31, in Las Vegas. The TPE has grown its cigar footprint over the years with 2020 being possibly the largest representation of cigar manufacturers at the show to date. The TPE is a business-to-business trade show that not only includes premium cigar and pipe tobacco exhibitors but other product categories that will be of interest to retailers including alternative, general merchandise and hemp/CBD products. The TPE trade show is operated and run by Tobacco Media Group (TMG) which is owned by Kretek International and is the publisher of Tobacco Business magazine.

In a press release from TMG today, Jason Carignan, chief marketing officer of Kretek International stated:

“After more than three years of hard work our efforts to boost TPE to be the single best total tobacco and nicotine trade show is coming to fruition. We’ve spent the past few years building solid executive-level relationships with the top cigar manufacturers, and today, they all announced they are pulling out of PCA. This year’s TPE is already shaping up to be our best show ever and I expect lots of growth for our 2021 show!

Ben Stimpson, managing director of TMG, added:

“TMG has focused on bringing in the right people and building the right team over the past few years. We have been totally committed to accommodating the growing needs of our industry partners to ensure we exceed their expectations. We are even more committed to making this year’s TPE 2020 the best show ever and with a sold out show floor and record registrations going into the show this year, this is a sign of even bigger things to come.

These are exciting times for TMG as we continue to strengthen our relationships with both manufacturers and retailers throughout 2020 as we continue to serve as staunch supporters and advocates for the tobacco industry but more specifically, those manufacturers and retailers within the cigar and pipe tobacco industries.”

In Closure

In the end, companies have limited marketing budgets, and look for ways to get the best bang for their marketing dollar. I have personally spoken to various small and medium size cigar companies, that have told me the cost to attend TPE is close to 1/3 of that for the PCA Trade Show. The questions will remain:

  • Is the value received is significant between the PCA Trade Show and TPE?
  • How many retailers will be attend the TPE vs the PCA Trade show?
  • How, we as an industry, battle the legal issues that surround us?

One thing is for sure – We do need a single voice when it comes to the legal fight.

In the Drew Estate press release, they did note that each company is:

..individually committed to using resources previously devoted to the PCA show and re-purpose these funds towards achieving two important goals for our industry.  One, to enhance the best-in-class trade programs and product offerings that continue to fuel the success of our retail partners. Two, to continue being at the forefront in the fight to protect the interests of the entire premium cigar industry against the imposition of unreasonable burdens that restrict our industry’s ability to market and sell our products to adult consumers.

It seems to me, that there may be major shift as to how education and legal representation, for the premium cigar industry, is conducted in the new decade.


Update 1/10 5:32 PM

The Boutique Cigar Association has made a public statement on Facebook:

It is our belief as small boutique cigar makers that this year we are in the biggest fight of our lives against the FDA. All of the member companies that are a part of the Boutique Cigar Association have been pushing alongside Cigar Rights of America for a premium cigar exemption from the FDA. We have also noticed in the the past couple of years that the Premium Cigar Association has also taken on this fight to exempt premium cigars.

The four big companies that have the most to benefit from FDA regulations on premium cigars are the ones mentioned in this article. The PCA and the CRA have been fighting for all cigar companies (big and small) and now the truth comes out.

What is disturbing to see is that these four companies are blaming the PCA for not running a show the right way, and on lower attendance rates rather than just coming out and saying that they don’t support the anti-regulatory agenda that the PCA has taken to preserve and protect the premium cigar industry.

This power move by the big four clearly states in bold letters “WE DO NOT SUPPORT A PREMIUM CIGAR EXPEMTION”. Historically large companies have always cornered the marketplace by regulating smaller players out of an industry. This is a pivotal moment for the premium cigar industry, this is a critical year. Let’s not allow this monopoly to happen. We need to put a stop to this. Let’s preserve and protect all premium cigar makers.

We love our trade associations (PCA & CRA) and appreciate all of their efforts to continue to protect family owned businesses. We want them to know they will always have our full support one way or another.

Let’s preserve and protect the entire industry. Most importantly we ask all of you to clearly understand who is fighting to protect and preserve the industry, and who is not. It couldn’t be more clear. These big 4 companies clearly do not want to support an organization that is set out to protect and preserve all premium cigar companies.

Is this a controversial statement, absolutely. But nowhere near as controversial as the press release statements that we have all seen today from these big four companies.

Update 1/10 11:15 pm

The Premium Cigar Association has provided the following response to our e-mail:

“As you may have heard from today’s press releases, four companies announced they will not exhibit at PCA 2020. We want to assure you that the world’s biggest premium cigar and pipe show is on with over 110,000 square feet of space booked by hundreds of family-owned companies. The four companies not attending represent 12% of show space and, since the announcement, many exhibitors have reached out to PCA to secure booth space, potentially expand their footprint, or relocate to the vacated space.   

The PCA 2020 show will be full, with the family-owned manufacturers who support the brick and mortar retailers and whose products fill our humidors. It is more important than ever that family-owned businesses that built this industry come together.

This year, PCA 2020 will have some exciting new features to showcase new products and help retailers and exhibitors create and enhance relationships. We will be rolling out new information in the coming weeks and months on those developments.  The PCA trade show remains not only the most important business event in the premium cigar and pipe industry, but also our greatest asset in fighting back regulations on both state and federal levels.

Your membership and attendance at the PCA trade show directly finances the industry’s legal challenges against the FDA. To date, along with our partners at Cigar Rights of America, we have spent a combined $4.5 million just on litigation against FDA regulatory oversight, not to mention the millions we spend every year on our legislative agenda. These efforts have benefited the entire industry.   

Our biggest priority remains focused on keeping a pathway for new products to come to market. After years of fighting, we are making some incredible new head ways in achieving major regulatory relief for the industry.

For any member who would like to get more involved in the PCA and in serving on a committee, please contact PCA Executive Director, Scott Pearce.   We thank you for your continued support and look forward to seeing you in Las Vegas this July at PCA 2020.   All the best,    PCA Board of Directors”

This is developing news and we will update this article as more information is available.

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