Questions for CP users

[billbaker3]

Wi-Fi :thumbs:
Big TV :thumbs:
Dual lounges if room provides :thumbs:
Poker Table (or at least a table suitable for cards, not everyone plays poker) :thumbs:

I would discourage drinking myself. I don't know if there are any legalities involved, but it seems like if someone is drinking at your place and something were to happen to them either there or on their way home there is some potential for trouble.The only thing I would add is to keep at least a small selection of pipes and tobacco. It seems to be a growing interest in many parts of the country.

Yes that is one of the things we have been thinking about.

There are a lot of good ideas in this whole thread. This is why I threw it to you guys. Once we get a business going, before we get the building, then we can talk to some of the Reps and see what a normal first time order is. I dont want to run out right off the bat, but I dont want to buy a ton either. I would rather have a little more though.

Thanks for all the ideas. Keep em coming.

 

[StinkiMonki]

Alcohol really helps the margin here in CA.

For example, if a cigar wholesale's price is $5, keystone pricing would put it at $10 retail. Now add the 45.13% CA tobacco tax in the amount of $2.25 and I have to sell the stick at $12.25 just to make $5 on the sale. That's only a 40% margin. If I sell $1000 worth of cigars, $600 goes into COGS and taxes. Yuk.

Alcohol has a tremendous markup. If I make $1000 in the bar, less then $200 goes into COGS.

Just a thought.

 

[Fia]

The Lounge would be for anyone to use as long as you purchased the cigars from us.

I rarely purchase cigars from a shop to smoke that same day, due to the storage conditions I find at most B&Ms. If I purchased $40.00 worth of sticks, but I wanted to smoke a Diplo #2 that I brought for the occasion, would your policy prevent it?

It would have to be flexable. I think in that circumstance then it wouldnt matter, you cant be a hawk about it.

Not take your post off topic, but just to give a suggestion on the smoking/buying thing.

Maybe something like....If you buy something here, you can smoke something here (regardless if it in fact a cigar you bought there). If you don't buy something here, you can smoke something here for the cutting fee....whatever it is.

Agree. Depends on your style. Maybe you dont even have to make it an "official" policy. Most guys appreciate a place to smoke these days and understand you need to make a living. If a guy seems to be taking advantage of that, just a kind word to him off to the side might do the trick. In the end, I guess it depends on your style. I wouldnt mind a 5.00 fee. In fact, it would encourage me to buy a cigar from your humidor that I havent tried yet.

I think TVs would be the most important extra but like mentioned earlier it would be nice to have a quieter place in the shop if people dont want to watch TV.

Good Luck!!! :thumbs:

 

[Fia]

Alcohol really helps the margin here in CA.

For example, if a cigar wholesale's price is $5, keystone pricing would put it at $10 retail. Now add the 45.13% CA tobacco tax in the amount of $2.25 and I have to sell the stick at $12.25 just to make $5 on the sale. That's only a 40% margin. If I sell $1000 worth of cigars, $600 goes into COGS and taxes. Yuk.

Alcohol has a tremendous markup. If I make $1000 in the bar, less then $200 goes into COGS.

Just a thought.

Thats a good point. You will have to consider your profit margin. If you have high taxes like the example above, even the most well intentioned buyer isnt going to buy as much. In stead of selling a handful of cigars at a time, you might end up selling one or two. Unfortunately, most cigars have high price elasticity. An alternative source of income might be very useful. Of course, you will sell accessories but those are mostly one time purchases for the average customer. You will make your money on the repeat business. Thats one good thing about cigars. As long as your pricing is reasonable and the customer service/environment is good, you will get lots of repeat business. Im not sure what the mark up is but an alternative would be an espresso/latte bar. We had a place that you could walk into buy a cigar and a espresso, have a smoke and watch the game. Great place. It is no longer in business but not for lack of customers. I think there were some internal problems between the owners.

 

[billbaker3]

Alcohol really helps the margin here in CA.

For example, if a cigar wholesale's price is $5, keystone pricing would put it at $10 retail. Now add the 45.13% CA tobacco tax in the amount of $2.25 and I have to sell the stick at $12.25 just to make $5 on the sale. That's only a 40% margin. If I sell $1000 worth of cigars, $600 goes into COGS and taxes. Yuk.

Alcohol has a tremendous markup. If I make $1000 in the bar, less then $200 goes into COGS.

Just a thought.

Thats a good point. You will have to consider your profit margin. If you have high taxes like the example above, even the most well intentioned buyer isnt going to buy as much. In stead of selling a handful of cigars at a time, you might end up selling one or two. Unfortunately, most cigars have high price elasticity. An alternative source of income might be very useful. Of course, you will sell accessories but those are mostly one time purchases for the average customer. You will make your money on the repeat business. Thats one good thing about cigars. As long as your pricing is reasonable and the customer service/environment is good, you will get lots of repeat business. Im not sure what the mark up is but an alternative would be an espresso/latte bar. We had a place that you could walk into buy a cigar and a espresso, have a smoke and watch the game. Great place. It is no longer in business but not for lack of customers. I think there were some internal problems between the owners.

Right now we are banking on the Lounge, since no one around has one. Obviously we still have a lot to discuss. There is a place that is about 10 - 15 miles from here that has a nice LITTLE lounge and they do awsome. Its a nice place with a good selection and is not expensive. That is the place we are kind of modeling after. Ours will be a little bigger and we want to get like poker nights and such going in there. There is a lot that we can do. Should be fun, yet scary.

 

[TMarquis]

This is the best lounge around the Seattle area, imo - http://smokeyjoessportsbar.com/index.html

One cool thing they do is, on four seperate tables they have four seperate setups with 17" computer monitor's sitting on top of XBOX360's. Just ask the waitress for the wireless controllers, and you can play Madden '08 with some friends while enjoying your smokes, food and atmosphere, while not bothering everybody else with your game. They don't charge for the use of the XBOX's, just something else to keep you in there smoking/eating/drinking.


Something else you may want to put a lot of thought into, is the air ventilation. Smokey Joe's has an extremely nice setup, that clears the room of smoke very gently. You have to pay attention to notice that your smoke is slowly pulled into the raftors, even when you blow towards the floor. I appreciate this, as even though I'm smoking along with everyone, if I walk into a lounge that is filled with other peoples smoke, both stale and not, I'll instantly exit and won't be returning. I smoke a specific cigar to taste THAT cigar, not sombody elses smoke, along with my eyes burning and coughing.

 

[Fia]

This is the best lounge around the Seattle area, imo - http://smokeyjoessportsbar.com/index.html

One cool thing they do is, on four seperate tables they have four seperate setups with 17" computer monitor's sitting on top of XBOX360's. Just ask the waitress for the wireless controllers, and you can play Madden '08 with some friends while enjoying your smokes, food and atmosphere, while not bothering everybody else with your game. They don't charge for the use of the XBOX's, just something else to keep you in there smoking/eating/drinking.


Something else you may want to put a lot of thought into, is the air ventilation. Smokey Joe's has an extremely nice setup, that clears the room of smoke very gently. You have to pay attention to notice that your smoke is slowly pulled into the raftors, even when you blow towards the floor. I appreciate this, as even though I'm smoking along with everyone, if I walk into a lounge that is filled with other peoples smoke, both stale and not, I'll instantly exit and won't be returning. I smoke a specific cigar to taste THAT cigar, not sombody elses smoke, along with my eyes burning and coughing.

Very good point. A good ventilation system is a big plus. I would even say more so than a TV if the shop is small and will cloud up easily if 5 or 6 people start smoking.

 

[billbaker3]

This is the best lounge around the Seattle area, imo - http://smokeyjoessportsbar.com/index.html

One cool thing they do is, on four seperate tables they have four seperate setups with 17" computer monitor's sitting on top of XBOX360's. Just ask the waitress for the wireless controllers, and you can play Madden '08 with some friends while enjoying your smokes, food and atmosphere, while not bothering everybody else with your game. They don't charge for the use of the XBOX's, just something else to keep you in there smoking/eating/drinking.


Something else you may want to put a lot of thought into, is the air ventilation. Smokey Joe's has an extremely nice setup, that clears the room of smoke very gently. You have to pay attention to notice that your smoke is slowly pulled into the raftors, even when you blow towards the floor. I appreciate this, as even though I'm smoking along with everyone, if I walk into a lounge that is filled with other peoples smoke, both stale and not, I'll instantly exit and won't be returning. I smoke a specific cigar to taste THAT cigar, not sombody elses smoke, along with my eyes burning and coughing.

Very good point. I good ventilation system is a big plus. I would even say more so than a TV if the shop is small and will cloud up easily if 5 or 6 people start smoking.

I work for a HVAC distributer. This is not a problem.

 

[StinkiMonki]

Unless you are a stand alone building, make sure you don't create negative pressure in your smoking area. Neighbors won't like you at all.

 

[stlboarder]

I was pondering this the other day... do you have to get a permit to allow people to smoke in the building. With all the laws today I wouldn't doubt it.

 

[Fia]

I work for a HVAC distributer. This is not a problem.

Score!!! :thumbs: :thumbs: :thumbs:

 

[simmsboard]

One of the few things I don’t like about my favorite local B&M is the fact that they do not have lockers of rent that are in the Humidor. I have decent set ups at home, but I would be more willing to rent a locker from a store if I did not have to worry about keeping conditions good. I don’t rent now because I don’t see any real benefit to stashing any good smokes at the store if I have to work at keeping them at a good smoke-able level.

 

[StinkiMonki]

I was pondering this the other day... do you have to get a permit to allow people to smoke in the building. With all the laws today I wouldn't doubt it.

Here in CA it's the Labor Code which makes it nearly impossible to smoke inside any commercial establishment. However, burried in that code are a few exceptions. One is a retail tobacco shop, another is a private lounge. In CA you can also get a license to serve alcohol in a private lounge. The only down side is the requirement of members. With members comes a membership fee. While the membership fee is a 100% margin type of sale, I think I'd have more people in the back lounge drinking and smoking if there were no charge. However, if the lounge was open to the public I'd be considered a bar and no longer allowed to smoke. One big giant governmental circle jerk.

Open a pet store instead. LOL

 

[TMarquis]

I was pondering this the other day... do you have to get a permit to allow people to smoke in the building. With all the laws today I wouldn't doubt it.

Here in CA it's the Labor Code which makes it nearly impossible to smoke inside any commercial establishment. However, burried in that code are a few exceptions. One is a retail tobacco shop, another is a private lounge. In CA you can also get a license to serve alcohol in a private lounge. The only down side is the requirement of members. With members comes a membership fee. While the membership fee is a 100% margin type of sale, I think I'd have more people in the back lounge drinking and smoking if there were no charge. However, if the lounge was open to the public I'd be considered a bar and no longer allowed to smoke. One big giant governmental circle jerk.

Open a pet store instead. LOL

You can offer a free membership with a purchase, or have the membership fee be $5 or so, something extremely nominal, but is still considered a members only lounge.

 

[The Master]

Since no one has mentioned this, I thought I would. You will need to have one years worth of cash to cover all of your expenses, i.e rent, payroll, utilities, interest on your bank loan. 90 percent of new businesses fail because they are under capitalized. If you cannot come up with a years worth of cash, I would not even think about starting up.

I started a business back in 1990, and was lucky in that we began to show a profit after the first 6 months. That business is still going 18 years later.

 

[gmiranda33]

Don't let the cigar reps bully you into buying unnecessary inventory. In most cases count on order 2 boxes of the item, 1 for show on shelf and 1 to go. Also study the shops in area as to what brands they carry, they might not carry some because they cant get them and others because unfortunately they don't sell.

You also might want to let some store owners in the area that you are considering this move, its better to have them on your side than starting a war against you. Just my $.02.

 

[mealstrom]

Good luck man!

At our shop we have free WiFi, satellite, free coffee (we sell coffee, so the free stuff is to let people try it), and a lot of nice lounging areas. We used to sell sodas, but after a while we just started letting regulars pick them up for free.

I'd make sure that no matter what you do you at the very least have free WiFi and satellite. We get a TON of people who come in just for those, and end up staying longer because of it.

I'd also recommend that you allow people to bring in their own cigars. I've been to shops where they don't allow that, and I never go back. If I go into a shop many times I want to bring a certain cigar or two I'm in the mood for. If I do I always make a point to buy something just to support them. We pretty much run off the philosophy of if people enjoy coming in and relaxing, then they'll come back. The owner is even cool enough that when a regular wants a cigar and runs out of cash, she gives it to them and has them come back later to pay. We've never had a single time someone hasn't come back and paid for their cigar.

We get a LOT of people tell us that our shop feels like their living room, but they can smoke inside. :laugh: We even leave the WiFi on when we're not here so people can use it on the front porch. We have barbecues and dinners all the time where anyone interested in eating just brings their own little contribution.

So far we've been open more than a year and it gets better and better each month.

 

[mealstrom]

Can't smoke there unless you buy it there? I understand it, but why not charge a cutting fee for those that want to go there just to smoke. If they want to smoke their own, charge'em $5 to do so. It'll bring in customers if they need a place to smoke....and guess what, if you go there chances are you're going to end up buying something.

See this is what made me and my buddies choose not to come back into a shop we visited in WI. We walked in wanting to herf, and all of us brought some really nice cigars to share. The lady came around and told us that if we wanted to bring in our own cigars we had to pay a fee. She used the excuse that it was like a corking fee at a restaurant. We immediately got up and left, and found another place that didn't care. We all smoked up the cigars we'd brought for each other, and none of us walked out without having purchased at least $200 apiece. (I spent almost $350! )

The way we see it at our shop is that it isn't hurting business for guys to bring their own cigars in. It isn't costing us any extra money for them to bring their own. But it DOES cost us money when we drive someone away because we seem like we're just out for their money. Would the $5 cutting fee be worth driving someone away when they will most likely at some point spend MUCH more than that on cigars? I find those businesses to be cigar Businesses, not Tobacconists. If I want to deal with a business I'll shop online. If I want to relax and smoke some nice cigars I'll visit a tobacconist.

Another way we make good money is in pipes and pipe tobacco, plus we do a LOT of cigar art. Cigar box clocks, cigar band art, etc. People buy that stuff up like crazy.

 

[billbaker3]

Can't smoke there unless you buy it there? I understand it, but why not charge a cutting fee for those that want to go there just to smoke. If they want to smoke their own, charge'em $5 to do so. It'll bring in customers if they need a place to smoke....and guess what, if you go there chances are you're going to end up buying something.

See this is what made me and my buddies choose not to come back into a shop we visited in WI. We walked in wanting to herf, and all of us brought some really nice cigars to share. The lady came around and told us that if we wanted to bring in our own cigars we had to pay a fee. She used the excuse that it was like a corking fee at a restaurant. We immediately got up and left, and found another place that didn't care. We all smoked up the cigars we'd brought for each other, and none of us walked out without having purchased at least $200 apiece. (I spent almost $350! )

The way we see it at our shop is that it isn't hurting business for guys to bring their own cigars in. It isn't costing us any extra money for them to bring their own. But it DOES cost us money when we drive someone away because we seem like we're just out for their money. Would the $5 cutting fee be worth driving someone away when they will most likely at some point spend MUCH more than that on cigars? I find those businesses to be cigar Businesses, not Tobacconists. If I want to deal with a business I'll shop online. If I want to relax and smoke some nice cigars I'll visit a tobacconist.

Another way we make good money is in pipes and pipe tobacco, plus we do a LOT of cigar art. Cigar box clocks, cigar band art, etc. People buy that stuff up like crazy.

I never thought of cigar art. It is kind of intresting. And we will have pipes and pipe tobacco.