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Question on SCHIP

uptown_isy said:
There are some companies out there who are raising their prices anyway. Great idea...price increase amongst the tax increase. Others are increasing the tax only. And there are a few who are eating up the tax and not increasing their prices at all. If we are charged an extra $0.40 per cigar, then we will increase our price by $0.40.
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gmiranda33 said:
You are correct. The tax is $.40+ per cigar, roughly $.41 rounded up. As a retailer I am only increasing the retail prices by just that, which is what the manufacters are going to increase their prices by.
IMO some sneaky retailers will increase it to the $.80 per stick to make a profit.
Its ultimately up to you the consumer to decide whom you purchase from.
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Footbag said:
Pete Johnson said he will be absorbing the .40 increase, and his lines will not have a price increase. I don't mind the B&M's raising their prices in step with the manufacturers, but hopefully the B&M's will not use the tax to increase their margins. At least we know the good ones won't.
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smokintexas said:
I think it would be beneficial to compile a list of the manufacturers that are eating the $0.40. That way when someone goes into a B&M that charges 2-3x MSRP for a cigar and blames it on SCHIP you can just say "the manufacturer didn't charge you for the tax increase so where is this extra money going?"
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I really feel like my local B&M is taking advantage of the situation. I sit smoking a TAT in his lounge and his is changing the price right know even on the cigars that are on the shelf. As well as all the new stock.

I am all for making a dollar. But with times like these hell I really can not see paying an extra 40 cents per cigar because my local man feels I am not smart enough to understand the tax laws.

To all the RETAILERS who responded to this topic, BIG THANKS.

And keep looking out for the BROTHERHOOD.
 
let me attempt to shed some light on this from a retailers point of view. i was totally against "keystoning" the 41 cent tax. i was just going to pass it on to the consumer. however, its not as black and white as you guys are making it out to be.

looking at an invoice of cigars, the SCHIP will not show up as a line item. most manufacturers will "build" in into the actual cigars...and thats where it gets tricky. as stated before in this thread, some companies are charging the full 41 cents, some are eating a % of it and some are eating all of it. (btw, pete is not one of the latter, i spoke to him yesterday & he told me he would try to eat as much as posible, but couldnt do it all). so how are we as retailers to know how the company charged us for the SCHIP? we wont...because they are not supposed to line item that tax. so all we can do is put in our usual profit and roll with it. if it was up to me, id increase each cigar by 41 cents, but dealing with 40 different companies, each hiding their SCHIP tax and rasing their prices regularly, its logistically impossible to keep track of what that magic number is.
 
marcsheldon said:
let me attempt to shed some light on this from a retailers point of view. i was totally against "keystoning" the 41 cent tax. i was just going to pass it on to the consumer. however, its not as black and white as you guys are making it out to be.

looking at an invoice of cigars, the SCHIP will not show up as a line item. most manufacturers will "build" in into the actual cigars...and thats where it gets tricky. as stated before in this thread, some companies are charging the full 41 cents, some are eating a % of it and some are eating all of it. (btw, pete is not one of the latter, i spoke to him yesterday & he told me he would try to eat as much as posible, but couldnt do it all). so how are we as retailers to know how the company charged us for the SCHIP? we wont...because they are not supposed to line item that tax. so all we can do is put in our usual profit and roll with it. if it was up to me, id increase each cigar by 41 cents, but dealing with 40 different companies, each hiding their SCHIP tax and rasing their prices regularly, its logistically impossible to keep track of what that magic number is.
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but can i ask how a profit is look at; what i mean is this: if i charge 10% over cost on my cigars then my prices should always raise uniformly with what ever the manufacturers do. So if they raised their prices to include the tax my price wouldn't raise much because im still making the same profit if i use a 10% markup. Now i assume no vendor does a straight mark up against all cigars. Just wondering shouldn't we as the consumer see a pattern so that we don't go and distrust our vendor and think he is trying to rip us off.

edit:sp
 
Bxcigrfan said:
marcsheldon said:
let me attempt to shed some light on this from a retailers point of view. i was totally against "keystoning" the 41 cent tax. i was just going to pass it on to the consumer. however, its not as black and white as you guys are making it out to be.

looking at an invoice of cigars, the SCHIP will not show up as a line item. most manufacturers will "build" in into the actual cigars...and thats where it gets tricky. as stated before in this thread, some companies are charging the full 41 cents, some are eating a % of it and some are eating all of it. (btw, pete is not one of the latter, i spoke to him yesterday & he told me he would try to eat as much as posible, but couldnt do it all). so how are we as retailers to know how the company charged us for the SCHIP? we wont...because they are not supposed to line item that tax. so all we can do is put in our usual profit and roll with it. if it was up to me, id increase each cigar by 41 cents, but dealing with 40 different companies, each hiding their SCHIP tax and rasing their prices regularly, its logistically impossible to keep track of what that magic number is.
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but can i ask how a profit is look at; what i mean is this: if i charge 10% over cost on my cigars then my prices should always raise uniformly with what ever the manufacturers do. So if they raised their prices to include the tax my price wouldn't raise much because im still making the same profit if i use a 10% markup. Now i assume no vendor does a straight mark up against all cigars. Just wondering shouldn't we as the consumer see a pattern so that we don't go and distrust our vendor and think he is trying to rip us off.

edit:sp
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thats exactly right. so if you mark up the cigar 10%, then you are profiteering off the SCHIP, wheather you mean to or not. im going to get an invoice that says this box of cigars cost me $100.00. i will put my standard margin on it and put it on the shelf. unelss i spend countless hours calling each cigar company to try and figure out how they SCHIP'd me, which i may or may not get a atraight answer anyway, i wont know. and neither will the consumer. so if the price goes up 5%, i look like a good guy, if the price goes up 10%, i look like a gouger.

a good example...i had a rep tel me the other day that his company was going to eat the SCHIP, but probably raise their price of the actual cigars in the spring. now, you and i see right through that, but ill end up looking like a bad guy because it looks like im profiteering off the new tax.
 
marcsheldon said:
let me attempt to shed some light on this from a retailers point of view. i was totally against "keystoning" the 41 cent tax. i was just going to pass it on to the consumer. however, its not as black and white as you guys are making it out to be.

looking at an invoice of cigars, the SCHIP will not show up as a line item. most manufacturers will "build" in into the actual cigars...and thats where it gets tricky. as stated before in this thread, some companies are charging the full 41 cents, some are eating a % of it and some are eating all of it. (btw, pete is not one of the latter, i spoke to him yesterday & he told me he would try to eat as much as posible, but couldnt do it all). so how are we as retailers to know how the company charged us for the SCHIP? we wont...because they are not supposed to line item that tax. so all we can do is put in our usual profit and roll with it. if it was up to me, id increase each cigar by 41 cents, but dealing with 40 different companies, each hiding their SCHIP tax and rasing their prices regularly, its logistically impossible to keep track of what that magic number is.
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Could you explain this Marc? Per whos instructions?
 
I tell you and who is in control of the banks and auto right know.

However it is very clear that if the cigars that sits on the floor today should remain exempt from the tax.

Thanks for all the info once again.
 
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