Editor’s Note: WINNER ANNOUNCED!!! Congratulations to E_Fryer16 for his question (Winner receives a Gurkha Prize Pack including 5 Gurkha Seduction Cigars, 2 Gurkha Royal Challenge Cigars, 1 Gurkha Hat, 1 Gurkha Shirt):
E_Fryer16: You mentioned that Gurkha is a family business. How do you keep the family traditions going strong while building your brand and adapting to the changes in the markets?
Gary Hyams: There is something special about a family business and while we are working to expand and grow the business to the next level (both domestically and internationally), it’s important to retain the culture and authenticity that makes the company special.
Recently we had the pleasure of sitting down with Gary Hyams, CEO and President of Beach Cigar Group Inc, parent company of Gurkha Cigars. Gary has been in the industry for over thirty years and has held some pretty interesting and diverse positions throughout his storied career. Most recently he was the Chairman of CAO international part of the Scandinavian Tobacco Group, but In the last year he left STG, and decided to take on a new challenge. Gary accepted the position of CEO and President of Beach Cigar Group Inc. in the hopes of building on their current success and taking them to the next level.
The following is an illuminating interview with a man who has spent most of his career studying the industry and working in it. Gary was kind enough to talk with us about his new position with Gurkha, where he sees the company in the market, and where they are headed to next:
Cigar Brief (CB): What do you see the role of your company being in the current market place?
Gary Hyams (Gary): I think Gurkha has a very strong brand name that can target a variety of different consumers. We can position ourselves at different points in the market place because we have a variety of blends at different price points. We have the world’s most expensive cigar with His Majesty’s Reserve and other Ltd lines like the Triad, Genghis Khan and Black Dragon, but we also have brands that are high volume lines at reasonable price points such as Evil, Assassin, Vintage Shaggy and Ninja. Overall, we are always striving to be innovative and create a diverse portfolio with unique packaging.
CB: How would you describe your current lineup of cigars, and its niche in the market?
Gary: As mentioned, I think Gurkha can appeal to a large consumer base because of our variety of blends and price points that cater to all market sectors. Our core brands are all unique, with their own character, and we are placing a strong emphasis on our 3 new brands: Cellar Reserve, Royal Challenge and Seduction, which are all retailer exclusive brands that cannot be purchased online. We did this to further enhance our support for the Brick and Mortar and look to further grow our relationship with these customers moving forward. I also believe there has been a trend in the popularity of cigars from boutique manufacturers. As a family owned business, we look to capitalize on this trend in the marketplace.
CB: What were some of the challenges you faced when you switched from your role at CAO and Scandanavian Tobacco Group to your new role at Gurkha?
Gary: Well I think the first thing is that CAO was originally a boutique company as well but was acquired in by Scandinavian Tobacco Group (STG), a large multi national company, so there was an immediate change in the structure and controls in the way that the business was run. My own background is from a private, family run cigar business in the UK, so I am very familiar with the many additional challenges that a small business can face. Certainly, even though CAO was owned by a large corporate entity, I tried to maintain the unique culture of the company. So, being at Gurkha is like going back to my roots in a way and like all things there are many benefits, but also some limitations, as we do not have some of the financial muscle that is available at large, corporate entities. My main challenge therefore is to grow the business without having available some of the huge resources I had become accustomed to whilst working for a large, multi-national company.
CB: Gurkha has been producing what seems to be a large amount of lines each year. Are there plans to keep this pace, or to start to slow down that approach and create fewer lines with a focus on the limited run model that seems to be sweeping the industry?
Gary: That’s a good question because it’s true in that we do have a large portfolio of brands that have evolved over the years. Certainly, one of my immediate strategies has been to rationalize the range so that we can focus more on what I call the core brands of Gurkha. Having said that, we still plan to continue with some of the Ltd edition brands that the company has become famous for, such as the Triad, HMR, Genghis Khan, Warlord, Black Dragon etc, but our volume focus will certainly move emphatically to the core brands such as Cellar Reserve, Royal Challenge, Seduction, Evil, Ninja, Assassin, Grand Reserve, Shaggy’s etc.
CB: This year saw the release of the Wicked Indie a cigar that was hailed as being part of the new East India Trading Company. In that press release you called it the first in the line of the new subsidiary East India Trading Company. Can you explain to our audience what the chief difference is between the Gurkha lines and the new East India lines?
Gary: I think Gurkha is a unique brand within itself, but from a Marketing point of view, we also wanted to have the option of brining out new, innovative brands that did not always reflect the unique Gurkha image. Kaizad was lucky enough to have secured the trademark for the East India Trading Company several years ago, which origins go back to being the first company who were trading in tobacco. We were able to use this as a vehicle for launching new, edgy cigar concepts at very competitive price points, such as the Wicked Indie, which has an MSRP starting at $4.79. East India is allowing us to explore a different marketing strategy to Gurkha, but we are still retaining the focus on the cigar. We plan further extensions from East India Trading this summer.
CB: Speaking of your lines, with the influx of boutiques have you seen a need to adapt or change your business strategies?
Gary: To be honest, I think the emphasis on boutique brands is really helping us. The way the brand has always been marketed has been very special and the packaging and presentation is totally unique. So, we are enjoying the benefits of this trend, but at the same time looking to explore other avenues that the consumer may be driven to in the future.
CB: What is your main approach to creating and maintaining brand consistency and loyalty?
Gary: Well, I think our main focus here is ultimately the product and to ensure we maintain the quality and consistency of each cigar. This is not as easy as it sounds as premium cigars are organic, hand-made products, so there will always be some variation from batch to batch. The challenge therefore is for us is to work with the best factories and to maintain and improve the quality control and performance of the cigars we produce.
CB: What do you want a customer to walk away with after smoking one of your cigars?
Gary: I think the goal for all cigar manufacturers is for our consumers to have the best smoking experience possible and to become brand loyal and obviously come back for more.
CB: Lastly, are there any new projects on the horizon that you can tell us about?
Gary: Here at Gurkha, there are always new products on the horizon, but this year we are working on a very special project for our 125th Anniversary, which the brand celebrates this year. We are sampling and working on the blend and packaging as we speak and are excited about the year ahead. We also have other new products and line extensions in the works that we will reveal at a later date.
I want to thank you and Cigar Brief for your time and support and look forward to enjoying a cigar with you in the near future.
We just want to thank Gary and the folks over at Gurkha Cigars for taking the time to talk with us and for helping us create the following contest below. Gurkha is an exciting company and a titan in the industry. We look forward to the IPCPR to see what Gurkha comes out with this year. Read on to find out how you too, can win some swag from Gurkha, including a five pack of Gurkha Seduction.
*****Contest Rules & How to Enter: Entering the contest is simple. All you have to do is ask a question in the comment section and the best question will win a response from Gary Hyams himself, and a five pack of the Gurkha Seduction, and some other swag to be announced next week. You can enter as many times as you want, but only the most engaging and thought provoking question will win, so good luck! Contest ends on Friday, March 2nd, 2012****