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Old 02-17-2012, 10:03 AM   #41
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Default Re: My store is opening a lounge but we need some help...

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Free, but definitely NOT BRING YOUR OWN CIGARS. Do you bring your own food to a restaurant?

Speaking of restaurants, I'm in Chicago for the weekend. There are two delis I like to eat at. One of them has free wifi, guess which one I'm at right now?
The owner of my shop doesn't mind if you bring your own every once in a while...

As long as you buy at least one from him before venturing into the lounge.

It has worked out well since if any of us regulars see someone taking advantage we give them a rash of fire and brimstone.
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Old 02-17-2012, 10:08 AM   #42
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Default Re: My store is opening a lounge but we need some help...

With your avatar, I think I'd wanna avoid fire and brimstone from you!
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Old 02-17-2012, 10:30 AM   #43
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Default Re: My store is opening a lounge but we need some help...

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With your avatar, I think I'd wanna avoid fire and brimstone from you!









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Old 02-17-2012, 10:42 AM   #44
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Default Re: My store is opening a lounge but we need some help...

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This is bothersome in that they are expanding without knowing how to afford it...(sound familiar)!
This was my thought immediately. I was thinking, "Why create a lounge if you don't know how
you will be able to make money from having a lounge". I agree that HAVING it allows you to draw
more customers to the shop, but the large majority of them I believe are already gone over to
the side of having their smokes airlifted to the island and are looking for a place to hang out and
BS with other smokers. So in a way it's a no-win situation, at least IMOO. But when I was young
and full of ideas to make money with, I was going to open a private cigar club.
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Old 02-17-2012, 11:06 AM   #45
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Default Re: My store is opening a lounge but we need some help...

Maybe I am spoiled but I would never pay to smoke in a cigar shop lounge. If it was a bar that is different. The shop next to my office has a small lounge that is maybe 12x16 and he charges non members $20 to smoke there. While its not out of my league I don't go there I just drive another mile or two to a shop that has twice the lounge and its free but he does ask out of courtesy to buy something. I don't expect free beverages but if you are selling cigars and have a lounge it had better be free unless you are offering me something that is special, like a free bar. If you are going to charge for drinks then again that should be your money maker not your cover. If you insist on charging a cover then it should be waved after a purchase is made. If you want a certain atmosphere then enforce a dress code and a purchase minimum but I wouldn't charge a fee on top of a purchase. As many others have said a lounge should be there to promote customer loyalty not as a revenue stream just to have a place to sit.
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Old 02-17-2012, 11:29 AM   #46
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Default Re: My store is opening a lounge but we need some help...

Are you building a lounge or a club? There is a big difference!

The shop I used to work at was an open room shop, with a walk-in humidor, a lounge area with free coffee, WiFi, and water for the patrons who came in. 2 couches, a couple chairs, a 42" LCD, a table for dominoes and cards, rental lockers, and all that jazz. It was all free for anyone that walked in, and while people abused it frequently, it wasn't bad.

About a year ago, they added a private club lounge with a pool table, dartboard, poker table, another TV with recliners, music system, coke machine, coffee machine, etc etc. This was mostly to get a noisy poker game out of the shop area (bad for business), but also because it was an opportunity to expand the floor space into the adjacent suite that was unoccupied for a cheap price. Membership is $500 a year, or $50 a month, or $10 a day for access, and monthly/yearly members have 24-hr card access. These are separate suites in the building, with a door connecting them, and outside entry to each side.


Charging a membership or day fee for a separate club area is perfectly acceptable, because those are extra amenities, and extra hours, that go above and beyond what a basic shop offers.

Charging just for a place to sit and smoke in the basic shop area is not a great business plan IMO, but some things like local smoking laws, rental agreements, or simple shop space may dictate otherwise.
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Old 02-17-2012, 01:02 PM   #47
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Default Re: My store is opening a lounge but we need some help...

Has anyone been to Portmann Tabak private lounge in Switzerland? If you can make it like that; people will pay! Yearly fee and 24 hour access to a very comfortable lounge with beverage service.
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Old 02-17-2012, 05:35 PM   #48
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Default Re: My store is opening a lounge but we need some help...

Hey sam, I dont know which shop you are from, but if you let me know, I would love to check you out next time I go to oahu.

I know cigars is kind of a hard business in Hawaii, here on maui, we have never really had a successfull B&M. The only guys who seem to last are the ones with outrageous markup, selling to the tourist market.......And even they have other products besides cigars.

My advice would be to go small. Real estate here comes at a huge price. The less money you put into it, the less you will have to get out of it. Sure, we would all like a five star atmosphere to hang out in, but to be honest, I would be more than happy with a small area to sit and bs with friends. Assuming you dont need the space for something else, it really shouldent cost you much to have customers smoke in your store.

Better yet, scrap the whole idea and open one in maui.
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Old 02-19-2012, 09:03 AM   #49
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Default Re: My store is opening a lounge but we need some help...

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The small shop i work in has recently expanded and we are in the process of making a smoking lounge. The only issue is how to make a profit off having the lounge or at the very least how to break even. We have considered several ideas but many seem to have us stuck in terms of execution. Any ideas would mean the world to me and the guys at my shop!
What shop Sam? I used to cover Hawaii for Oliva as part of my territory so I'm pretty familiar with the shops out there.
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Old 02-19-2012, 11:42 AM   #50
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Default Re: My store is opening a lounge but we need some help...

Start off with a basic lounge, couple nice chairs tables and a TV, throw in a coffee stand or something in there as well. The B&M i frequent in ann arbor lets me smoke my own cigars i bring in as long as i buy cigars from there as well (win win for me! i get to smoke a cigar i bring AND have a reason to buy more!).

You could always do an OPTIONAL lounge membership fee which would include perks, you could have different levels of memberships as well for example:
Level 1: 10% off cigars
Level 2: 10% off cigars, free entry to private events
Level 3: 15% off cigars, free entry to private events, locker space

Put up a small snack stand with some candy and soda and run special promotions for the optional members often. buy X amount of cigars get the cheapest one free or something like that (discount doesn't apply or it could).
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Old 02-19-2012, 08:26 PM   #51
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Default Re: My store is opening a lounge but we need some help...

The shop is Tobaccos of Hawaii.
The biggest issue I'm worried about is that I remember the last lounge that recently closed on the island. They didn't charge to sit and smoke but their customers didn't buy anything. At times customers would even sell their own cigars in the store.
I know its a bit harsh but it is Hawaii and the weather is almost always nice. We are going to put in some outdoor seating that will be free but we have to charge for the lounge. I mean if we don't charge then its not going to happen at all and people will have to find another place to enjoy their cigars.

Also, I would like to thank every one for responding to this thread. It means a lot to get you input and ideas!
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Old 02-19-2012, 08:34 PM   #52
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Default Re: My store is opening a lounge but we need some help...

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Originally Posted by stj386 View Post
The shop is Tobaccos of Hawaii.
The biggest issue I'm worried about is that I remember the last lounge that recently closed on the island. They didn't charge to sit and smoke but their customers didn't buy anything. At times customers would even sell their own cigars in the store.
I know its a bit harsh but it is Hawaii and the weather is almost always nice. We are going to put in some outdoor seating that will be free but we have to charge for the lounge. I mean if we don't charge then its not going to happen at all and people will have to find another place to enjoy their cigars.

Also, I would like to thank every one for responding to this thread. It means a lot to get you input and ideas!
Ok, that doesn't sound like a problem with not charging for lounge usage. That sounds like a problem with the management/ownership not enforcing some simple rules.

A Customer selling cigars on your premises is a HUGE no-no.

It's your store. Your property. Your livelihood. If you have a customer selling his own cigars on store premises then he needs to be asked to stop. If he refuses, then he needs to be asked to leave. If he refuses, you call the police and have him removed... trust me the law is on your side there.

Secondly, if he is selling any sort of illegal material in your store, you've created a liability that could cost you your tobacco license or even more severe penalties.

Thirdly, it needs to be understood what a customer is. A customer or a patron is someone who contributes to the vitality and profitability of your business, if said person is not doing so (or even detracting from it) then they are not a customer and should be asked to either contribute, if they continuously choose not to, then they must be asked to leave.
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Old 02-19-2012, 08:51 PM   #53
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Default Re: My store is opening a lounge but we need some help...

Buy a cigar, you get to use the lounge. Don't buy a cigar, you don't get to don't use the lounge.

It's really pretty simple.
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Old 02-20-2012, 06:36 AM   #54
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Default Re: My store is opening a lounge but we need some help...

Sam..very interesting thread. This topic has been beaten to death here in Hawaii. Its a fine line between what most have said here about just supporting the store by buying products and making sure it at least breaks even. Note to everyone: the lounge being planned is a separate room connected to their shop with air filtration and not just some chairs in the middle of the store. As mentioned earlier, it is a mgmt decision to enforce the rule of supporting the store and not letting people bring in their own. Which I know in the minimum ToH will do. I dont see you or Justin or Chris having any problem telling people about no outside tobacco.

I dont know if our mainland friends realize how expensive real estate is in hawaii vs other parts of the country. The profit margin remains the same on the cigars here as on the mainland yet Hawaii businesses have WAY more overhead especially when it comes to rent. There is no other lounge in Hawaii to smoke in after south pacific pipes and cigars went out of business. In fact, Tobaccos of Hawaii is one of only 2 stand alone tobacco stores on the island. There are only 4 in the whole state that I know of with Tobaccos of Hawaii being the most successful. Most of the cigar business is from wine and liquor retailers using cigars as additional business. With our high cost of business here in Hawaii and a 50% cigar tax which leads to lots of lost cigar sales to the internet, its easy to understand why there are so few tobacconists left. 15 years ago, there were close to 10 just on Oahu. South Pacific Pipes and Cigars went out of business in part due to some people abusing their lounge and not supporting the business but it was mostly poor mgmt by the owner. That being said Tobaccos of Hawaii has much better business practices.

Another problem is that there is homeless population in the area and they come into their shop, drop a handful of coins on the counter and buy a cheap cigar. I remember one time Justin had to light a cedar spill to get rid of the smell after a homeless guy bought a cheap cigar! I dont know if I would want them hanging out in the lounge.

I have talked to a lot of the regulars on the cigar scene here and they cant wait for the lounge to open. I have mentioned to them the possibility of a fee and they seem to be fine with it. I think they appreciate just having a place to hang out. I would say that the fee should be reasonable. Im sure there is a portion of guys who wouldnt mind paying a modest membership but might not be able to afford or justify to their wives a steeper price! The tough part is getting it right on the first try..I dont envy the decision you folks have to make.

There has been some good suggestions about other ways of making the space profitable like offering drinks for sale (which you already have). I think some other things for the lounge that would be nice to have free if there is indeed a membership fee are free coffee, wifi, movies, etc. Might be able to have events in the lounge like pay per view mma, etc.

Also remember having the lounge space will allow you to have events which you currently dont have. I tried to get events going with South Pacific Pipes and Cigars. We did a couple and they made a nice chunk of money in the few hours of their events. The profits from the event could help offset the rent on the lounge. In fact, if you set up a monthly event on the same day the guys could plan around it and you would get even better participation. Also a great way to introduce new lines or cigar releases.

Another thing that needs to be addressed are the tourists. We always have visitors to the islands and there will always be that portion who like to sit down and have a smoke. With your proximity to Waikiki you will see a lot of that.

ToH is good people and I look forward to the new lounge and the great camaraderie that Im sure will follow!
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Old 02-20-2012, 06:37 AM   #55
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Default Re: My store is opening a lounge but we need some help...

Quote:
Originally Posted by stj386 View Post
The shop is Tobaccos of Hawaii.
The biggest issue I'm worried about is that I remember the last lounge that recently closed on the island. They didn't charge to sit and smoke but their customers didn't buy anything. At times customers would even sell their own cigars in the store.
I know its a bit harsh but it is Hawaii and the weather is almost always nice. We are going to put in some outdoor seating that will be free but we have to charge for the lounge. I mean if we don't charge then its not going to happen at all and people will have to find another place to enjoy their cigars.

Also, I would like to thank every one for responding to this thread. It means a lot to get you input and ideas!
Sam, I have some ideas and things that would help Chris out with this. Too much to type. I shot him an email and will hopefully be able to help him out with this project.
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Old 02-20-2012, 08:53 AM   #56
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Default Re: My store is opening a lounge but we need some help...

I agree Jon, Chris and Justin are both good people that know how to run a successful business. When I was out on Oahu last year visiting accounts, I hung out with both of them for almost the whole day. Chris had mentioned that he eventually wanted to do something like this, glad to see it's finally happening. They are big supporters of the Oliva/Cain/Nub brands and I really hope they get this lounge up and running. With there being so few places to smoke on the island due to the crazy smoking ban, this will be huge for both locals and tourists.
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Old 02-20-2012, 03:02 PM   #57
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Default Re: My store is opening a lounge but we need some help...

I can't believe somebody would bring their own cigar to a cigar lounge. Do you bring your own eggs and bacon to Denny's?
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Old 02-20-2012, 06:47 PM   #58
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Default Re: My store is opening a lounge but we need some help...

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I can't believe somebody would bring their own cigar to a cigar lounge. Do you bring your own eggs and bacon to Denny's?
Okay wait i have done this.. But when i do i make sure to buy a cigar from the owner. So i don't see why it would be a problem.
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Old 02-20-2012, 07:13 PM   #59
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Default Re: My store is opening a lounge but we need some help...

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I can't believe somebody would bring their own cigar to a cigar lounge. Do you bring your own eggs and bacon to Denny's?
I would bring my own too but if I did I more than make it up with the stupidly expensive scotch.
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Old 02-20-2012, 08:00 PM   #60
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Default Re: My store is opening a lounge but we need some help...

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I can't believe somebody would bring their own cigar to a cigar lounge. Do you bring your own eggs and bacon to Denny's?
I as well have done this. I have a lot of cigars i love to smoke which my B&M doesn't carry or can't keep on the shelves. I ALWAYS make sure to buy as many cigars from them as i smoke while i'm there and make sure they are ones that i will smoke again and not some cheap-o's. I personally don't see a problem with it and neither does the owner since he lets me continue to do so.
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