Cigar News: Southern Draw Cigars Declares no Price Increase for 2020

In a press release today, Southern Draw Cigars has declared they will not have any price increases on their cigars for 2020.

Sharon Holt a.k.a. The Rose of Sharon shared the company’s thought process:

“We wish to avoid spending too much time on price increase (and justification) discussions with our staff and current valued retailer partners.  The family believes this is time that should be spent on value increasing discussions instead.  Southern Draw has been blessed by the patience and loyalty of our partners and consumers, which more than warrants this important decision.” 

The company would also like to share the reasons for this decision with the industry (consumers and retailers), and offer the following 5 points:

  1. SDC would like to hold on to our retailers and customers during this time of gloom and uncertainty in the industry by providing quality products at fair prices and an incentive for consumers not to turn to bargain or overall cheaper products. 
  2. A price increase would likely increase churn in the essential life blood of brick and mortar shops operating in states with higher than average tobaccos related taxes.
  3. SDC has been blessed with a growth rate of >100% per year over the last 6 years, a 4% – 5% price increase now won’t really matter over the next 5 – 10 years, however the churn and the loss of referrals and consumer support will adversely impact our growth rate.
  4. A price increase on current products and with existing partners will take a lot of time and energy away from family, sales representatives and brokers, if sales are soft or growth declines, the opinion will likely be that it was due to the price increase.
  5. A one-time price increase may solve immediate increased labor, legal and logistical costs but when it is done, it hasn’t fixed any real issues.  We need to support the industry more and proactively work together on long term solutions that benefit the industry. 

Southern Draw Cigars plans to introduce more expensive product offerings in 2020 and when it has been determined a price increase is necessary, the company will make every effort to telegraph it well in advance and then apply it equally to all products in an attempt to mitigate any issues.