While I don't know the first thing about this situation and will not comment on it, but I will shed some light on the situation in general, coming from someone that's in the industry.
Protecting the price of our product is done for various reasons. The one that has already been mentioned is, deeply discounting a cigar line, or any other line at that, does de-value the brand. Take a look at Bose. They are a price protected product. To sell Bose, you have to adhear to their price points. You can walk into a Best Buy, h.h Gregg, or anywhere that sells Bose, and the price will always be the same. Hell I used to work at an h.h.Gregg when I was in college. I could get discounts on EVERYTHING for myself and I could edit the price on any big screen TV I wanted to, in order to match or beat a competitors price with a few strokes of a button, except Bose. No discounts, no price cutting. Look at it like this, when you say Bose to most people, they think, premier, high end, high quality, and high priced surround sound. Now, what if I were to open a chain of "BengalMan's Electronics" across the nation, and sell Bose for HALF of what everyone else was selling it for in my store and online. After a while Bose would no longer have the prestige that it does, and because of that, why would people pay the suggested retail for it at any other store when they can buy it for half off at BengalMan's Electronics? That's a segway into the next, and most important reason that prices are protected.
Cigar shops are a culture in themselves. A majority of the brands that have "brand name recognition" were built in B&M's. They have been, and will continue to be the grassroots, lifeblood of this industry. They provide a place where customers can socialize, relax, and get away from the everyday troubles of life, and have a cigar with someone that they may have never met before, but share a close bond with. That bond is the cigar. When you have an online shop that deeply discounts products BELOW MSRP, if takes away from the places that put most of these brands where they are today. Some brands may not care about that, but I know we do.
The problem that lies in this whole situation is the state taxes and OTP. None of it is regulated, and it keeps going up. In Michigan for instance, it's 32% and they're talking about doubling it to a whopping 64%. Now, a Michigan B&M can do nothing but pay the state that tax and in turn roll it over to the consumer. What the people passing this legislation don't understand, is that if they make it too high, people will do just what some of you have said, stop buying at the B&M's and buy online, because when you ship out of state, you don't have to pay the state (that is already changing though, but that's a WHOLE NOTHER TOPIC). Thus resulting in hurting the local economies even more because more local business will close and more people will be out of work.
In the end, please support your local B&M's. Even if it's only a stick a week, or a few here and there. You'd be supprised how far those few additional sticks can go for them. It may be the difference in being able to pay their electric bill without going into the hole that month. The B&M's helped build the indusry that we all love so much, the least we could do is show our support to them in these times of the economic downturn. These are all people that help keep your local economy alive. So next time your about to order that 5er online, think, "maybe this time, I'll go to my local B&M, pick up 3-5 cigars, smoke one and have a chat with the customers and owner about the hobby I love so much."
Thanks for reading my long rant. I'm heading to a B&M to work.
