Cost of making a cigar?

Thanatos0320

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

rsherman24

I couldn't even guess, but with the deals that can be found on cigars from retailers I would imagine the markup is substantial. Which should relate to the actual product being cheap. I am sure it depends on tobacco source, but other factors should be consistent.

Cigary

Cost is relative to the entire process of growing, harvesting, supplies and rollers as everything is kind of rolled into the overall cost. The better the tobacco the higher the pricing....remember that in order to make the first pharmacy medication that first pill is what costs the most....after that it's what the market will bear.

jlmarta

Cigary:

Cost is relative to the entire process of growing, harvesting, supplies and rollers as everything is kind of rolled into the overall cost. The better the tobacco the higher the pricing....remember that in order to make the first pharmacy medication that first pill is what costs the most....after that it's what the market will bear.

And in addition, the total number of any given cigar being made factors hugely into the equation. Are we talking a thousand cigars or a hundred thousand? The per-each cost will go down the more cigars are made.....

This is one of those questions like "how high is up?"

Amos Umwhat

and, of course, Unka Sugar's cut, I mean tax

rzaman

Are you sure you won't be disappointed when you know how much it truly cost?

Thanatos0320:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

kuzi16

rzaman:

Are you sure you won't be disappointed when you know how much it truly cost?

of course we will.

the B&M charges well over twice what they pay wholesale, and the B&M pays well over twice what the cost is. even many the "premium" blends end up with a pure cost well under $1.00 with most of that being labor and shipping cost.

like all products, there is a huge difference in cost to make and retail.

being that cigars are a luxury product, the markup is crazy. just gotta remember it is a business, and it seems that we are willing to pay for it.

Thanatos0320

Ill be shocked that's for sure. I figured it costs less than a $1 but I can justify certain prices because of how great some cigars taste.

0patience

Remember that the final cost of retailing the cigar to you includes shipping costs, marketing costs, costs of the boxes and/or cedar and the one that probably makes up a large percentage, taxes.
So while the cost of growing, harvesting, curing and producing a cigar might possibly be a nominal cost, add all the other stuff and you can see how the price can climb.

SleevePlz

Remember, however, that there are other costs outside of just making the cigar. How much gets spent in marketing? When you look at the price to make a My Father, are you including the cost to build the huge factory? What price do you put on aging tobacco for several years? What's the value in coming up with a truly great blend? So many more considerations than just the cost of tobacco and the rollers to make the cigars. Puffmaster recently created a new cigar brand (Swinger). I would be curious to hear his thoughts on the overall cost to bring it to market. I'd be willing to bet it is more than we think. Also, I'd be curious to see the correlation between the cost to make a cigar to the retail price of the cigar. For example, Company A has 2 cigars. One retails for $6 and the other $12. Does the second cigar cost twice as much to make? Are they actually really similar in cost, but one has fancier packaging?

kuzi16

SleevePlz:

Company A has 2 cigars. One retails for $6 and the other $12. Does the second cigar cost twice as much to make? Are they actually really similar in cost, but one has fancier packaging?

demand, hype, drive for profit, marketing, packaging, etc...

it all plays in. what i think most would surprised with would be the huge profit margin after ALL costs.
many goods have a large profit margin in the range of 3 to 7 cents on the dollar. From what i can gather, cigars tend to be significantly higher. sometimes these margins can be artificially increased through hype, limited availability, and perception of brand.
is it necessary?
does it matter if we are willing to pay for it?

charlespe

Well you need to think about all the work you need to do, such as the aging, blend testing, actual blending, rollers, inspectors and many more. I don't wanna think about the cost

Darktower007

This is probably spot on http://www.palomino-cigars.com/two-dollar-cigar.html#.U8e8c45Okuq

kuzi16

Darktower007:

This is probably spot on http://www.palomino-cigars.com/two-dollar-cigar.html#.U8e8c45Okuq

agreed. some brands are probably worse than others.

The3Stogies

I wonder why boxes are cheaper per stick than 5-packs wrapped in cello. Usually quite a bit cheaper. MOW box of 22 comes out to $4.60/stick, 5-packs come out to $5.60/stick. Buying 20 or so (the usual boxed amount) would be cheaper per stick than buying 5 makes sense, but what about the cost of the box itself?

brianetz1

The3Stogies:

I wonder why boxes are cheaper per stick than 5-packs wrapped in cello. Usually quite a bit cheaper. MOW box of 22 comes out to $4.60/stick, 5-packs come out to $5.60/stick. Buying 20 or so (the usual boxed amount) would be cheaper per stick than buying 5 makes sense, but what about the cost of the box itself?

the average customer expects to pay less when buying in bulk. hence why costco and sams exist. From a supply/demand standpoint why would you ever buy a box if you could buy 5 packs at the same price per cigar? I know i wouldn't every think of buying a box unless it is a shortrun if i could get the 5 pack at the same price.

The3Stogies

brianetz1:

The3Stogies:

I wonder why boxes are cheaper per stick than 5-packs wrapped in cello. Usually quite a bit cheaper. MOW box of 22 comes out to $4.60/stick, 5-packs come out to $5.60/stick. Buying 20 or so (the usual boxed amount) would be cheaper per stick than buying 5 makes sense, but what about the cost of the box itself?

the average customer expects to pay less when buying in bulk. hence why costco and sams exist. From a supply/demand standpoint why would you ever buy a box if you could buy 5 packs at the same price per cigar? I know i wouldn't every think of buying a box unless it is a shortrun if i could get the 5 pack at the same price.

I understand that buying in bulk is cheaper per unit, but the list price is what it is. Confused because of the box, or cost of the box to manufacturing and how it is passed on I guess. Is that spread out across the whole batch so even buying 5-packs, or singles, includes the cost of making the boxes for that run? It is all negotiable anyway, sometimes I buy 5-packs and get a better deal per stick than box prices. But there is no box, ah screw it, I'm gonna smoke a cigar.

catfishbluezz

Thanatos0320:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

30k for 10k cigars is a good average considering most expenses.

blutattoo

catfishbluezz:

Thanatos0320:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

30k for 10k cigars is a good average considering most expenses.

33 cents a stick? Wow I'm in the wrong business.

SleevePlz

blutattoo:

catfishbluezz:

Thanatos0320:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

30k for 10k cigars is a good average considering most expenses.

33 cents a stick? Wow I'm in the wrong business.

I think he meant the other way around. $30,000 to make 10,000 sticks, so $3/stick.

webmost

SleevePlz:

blutattoo:

catfishbluezz:

Thanatos0320:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

30k for 10k cigars is a good average considering most expenses.

33 cents a stick? Wow I'm in the wrong business.

I think he meant the other way around. $30,000 to make 10,000 sticks, so $3/stick.

Seems pretty high. I know I can buy leaves in one pound quantities shipped from afar and roll my own for about a buck a pop. The same leaves by the hundred bales at the farm has to be the slightest fraction of that. And I can buy any number of very nice cigar varieties all rolled up in decorated boxes, banded, celloed, boxed, advertised, shipped a heck of a long way, and climate control warehoused, then retailed by the box of 20 from c.com for 80 to 120 a box. So the cost to make a cigar can't be more than fifty cents. I just don't see three bucks at all.

catfishbluezz

SleevePlz:

blutattoo:

catfishbluezz:

Thanatos0320:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

30k for 10k cigars is a good average considering most expenses.

33 cents a stick? Wow I'm in the wrong business.

I think he meant the other way around. $30,000 to make 10,000 sticks, so $3/stick.

Yes this, after all is said and done, is a good average give or take 5k depending on quality of tobacco and operating costs based on where you live in America. This would be for an average costing boutique 3rd party based on my experience. Then you have to factor profit before selling to stores, store markup, and taxes. The margin is not huge by any means...

catfishbluezz

webmost:

SleevePlz:

blutattoo:

catfishbluezz:

Thanatos0320:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

30k for 10k cigars is a good average considering most expenses.

33 cents a stick? Wow I'm in the wrong business.

I think he meant the other way around. $30,000 to make 10,000 sticks, so $3/stick.

Seems pretty high. I know I can buy leaves in one pound quantities shipped from afar and roll my own for about a buck a pop. The same leaves by the hundred bales at the farm has to be the slightest fraction of that. And I can buy any number of very nice cigar varieties all rolled up in decorated boxes, banded, celloed, boxed, advertised, shipped a heck of a long way, and climate control warehoused, then retailed by the box of 20 from c.com for 80 to 120 a box. So the cost to make a cigar can't be more than fifty cents. I just don't see three bucks at all.

Check with 3-4 major boutique producers and inquire about them producing a cigar for you. Big difference my friend. This is startup costs for someone looking to make their own boutique cigar, not internet dog rocket, or roll your own. There are several middle men involved, one of which is the taxman whom double dips. All that being said, price per unit for a startup boutique will most likely be close to $3 a stick or higher. Getting it down to $2 would take serious capital and investment if you wanted to involve quality tobacco.

webmost

Maybe I mis-read the question. Here was what the OP asked:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

I didn't take that to mean the cost of making a new boutique blend.

Ken Light

webmost:

Maybe I mis-read the question. Here was what the OP asked:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

I didn't take that to mean the cost of making a new boutique blend.

I was under the same impression as catfish, that the OP was asking the cost to bring a cigar to market, not simply to roll it. But maybe not.

catfishbluezz

webmost:

Maybe I mis-read the question. Here was what the OP asked:

I was thinking about what it costs to make a cigar. Does anyone know? I would like to know what the total expenses are just to see how they compare to the prices at which the cigars are being sold.

I didn't take that to mean the cost of making a new boutique blend.

He asked for total expenses. Given the fact that most producers do not own all forms of the process, I would assume that is the best comparison. I can tell you what the larger guys that control the farm, factory, and processing pay, and it is less, but that is not the norm. Also, dog rockets will cost less as well, as they do not use the best tobacco or rollers. That being said, $3 a stick is not far off of the truth... I'd be more then happy to break it down for anyone whom wants to know. If I had the energy for sales again, I'd already be in the biz.