Guide for a Profitable Cigar Category

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Guide for a Profitable Cigar Category

BARRINGTON, Ill. -- Willard Bishop, a consulting firm based here, was recruited by John Middleton Inc., a cigar manufacturer, to identify ways that retailers can generate incremental profits from cigars.

The results, available in a "Cigar Merchandising Guide" to be published later this year, will highlight more effective profit-building strategies.

"When you consider the regional nature of cigars, the competing strategies of the product manufacturers, and the lack of any real consistent insights, it's clear that retailers could experience even stronger growth in cigars if they had a better base of information," Richard Fasanelli, vice president of marketing and sales at John Middleton, said in a written statement. "We continue to uncover additional growth opportunities with retail customers by applying strategies less common to cigars but very common in other major tobacco categories."

Cigar dollar sales in the convenience channel grew 14 percent in 2006, according to ACNielsen data cited by Willard Bishop.

"When you have a segment of the business growing at these rates year over year, retailers are focused on maximizing its potential. And, whether this means pricing for volume, expanding assortments, or increasing the visibility of the set, retailers will always need analytic and insights that enable them to successfully execute these strategies," said David Bishop, partner at Willard Bishop.

The goal of the project is to provide retailers with new insights on managing opportunities in the cigar category through facts, Bishop said. "We'll accomplish this via an active dialogue with the trade and an in-depth assessment of the current retail business over the coming months," he added.

The retail merchandising guide and an interactive Web cast will showcase the results in the fall.