Now 117 years old, J. C. Newman Cigar Co. is the oldest premium cigar company in the United States that is still owned by the founding family. The brands Cuesta-Rey, Diamond Crown and Brick House are known all over the world.
Approaching the center of Tampa coming from the Interstate 4, the impressive clock tower can be seen from miles away. And since a comprehensive renovation ten years ago, the clock also now sounds on the hour again – just the way it did in the beginning. In 1910, Edward Regensburg built his cigar factory here for 1500 rollers, and from that time on “El Reloj” (Spanish for “the clock”) determined the daily rhythm of today’s neighborhood of Ybor City.
In the 1920s, Tampa was the Cigar Capital of the World, with an annual production of up to 500 million cigars in some 200 factories. Thousands of immigrants from Cuba and Spain followed the jobs that became available with the construction of new factories.
The development was quick, when you think that the first cigars were not rolled much earlier than 1886 – that is, at the time when in the faraway Koronc (in the kingdom of Hungary) Family Newman had decided to emigrate to America.
Among their five children was Julius, who in 1888, as a 13-year-old, set foot on American soil for the first time in Cleveland, Ohio. After several years of apprenticeship he opened up his one-man cigar factory out of necessity, on May 5, 1895. As one of the registered cigar manufacturers – then 42,000 in the USA and 300 in Cleveland, Ohio – in this way he created an income on his own without further ado.
After all, following the outbreak of the financial crisis, in 1893, work was hard to come by. Thus the foundation for the business was laid, the skills of which he would manage up until his death in the year 1958.
J. C. Newman received his second name through pure coincidence, by the way. An immigration officer insisted on a middle name and gave as an “example” the Roman statesman and commander, who was generally known as Gaius Julius Caesar. But the civil servant was obviously not so well informed, and unceremoniously wrote down in the register “Julius Caeser” – including spelling errors. The thought of borrowing from history so tickled the young man that from that moment onward he only used the initials J. C.
Return to the Premium Market
Between the wars and the Depression the young entrepreneur’s business ran pretty well. He produced his own brands of cigars, his factories got bigger, and he invested in the first machines that made cigars. The big problem in the cigar industry of the 1920s was the rapidly growing popularity of the cigarette. This development intensified to such an extent that in 1927 only two cigar manufacturers existed in Cleveland: J. C. Newman and Grover Mendelsohn. They became partners as M & N Cigar Manufacturers, and Newman managed the business.
One considerable contribution to the economic survival was probably the decision to change production to machine-made cigars. A little background: In 1926 the percentage of machine-made cigars on the American overall market was just about 18 percent; 10 years later it was 75 percent. At M & N, 200 cigar machine operators produced 120,000 cigars of the brand Cameo six days a week and in two shifts daily … Still not enough to satisfy the demand.
“Even after the Second World War, our best sold brands were Cameo and Student Prince”, explains Eric M. Newman, grandson of the company’s founder and today president of the family business. “Both cost five cents – one nickel, as we say. That doesn’t sound like much today, but back then, that was more or less the standard price for a cigar. Of course these cigars were produced by machines, but the average citizen couldn’t and wouldn’t pay anything more.” These cigars passed over the counters in great numbers.
The problem was that five dominating cigar factories in the United States were producing these “nickel cigars” in huge quantities and also controlled the raw tobacco market. Eric M. Newman says: “They tried to oust small producers like our grandfather from the market.” And this is how that worked: The lion’s share of the necessary tobacco was produced by the companies themselves, for about three dollars a pound. “The rest they bought on the free market and offered six dollars for it. That way they drove up the prices and maneuvered small factories out.” After almost sixty very successful years, J. C. Newman was close to closing his factory.
“Unless we could find a niche in which the bigwigs couldn’t get us”, he put the crucial question to his family. The market segment that came into question was premium cigars, which at that time were only being produced in Tampa, Florida. There were 10 relevant family businesses there that all exclusively processed Cuban tobacco. Eric Newman explains: “At the age of 78 my grandfather moved the entire enterprise from Cleveland to Tampa, where we are today. On July 5, 1953, my father Stanford commenced operations here.”
The Stanford J. Newman Era
In 1938, J. C. Newman bought out his partner Grover Mendelson and became sole owner of M & N Cigar Manufacturers. His son Stanford, who had already earned his stripes as a salesman, fully entered the business after completing his studies. On his trips to the most important tobacco regions in Cuba and Connecticut Stanford J. Newman learned a great deal, and quickly.
In Connecticut he completed an eight-month training course in tobacco processing and sorting as well as out in the fields. Under Stanford’s control the company obtained national importance on the large United States market. Distribution was outsourced to the best companies in the large mega-regions; the cigars were known in all corners of the country and sold well.
Following the death of his father J. C. in the year 1958, another mentor entered the life of Stanford Newman: Karl Cuesta. In 1884, Cuesta’s father, Angel LaMadrid Cuesta (a Spaniard who had emigrated first to Cuba and then the United States) had founded the brand Cuesta-Rey with Peregino Rey.
And another thing: he was a close friend of the then Spanish king, Alfonso XIII – a fact that probably helped the cigar brand achieve its worldwide importance. After all, Cuesta-Rey was the official cigar of the Spanish royal house. Both his sons, Karl and Angel junior were close friends of Stanford’s and, in 1958, sold him the brands Cuesta-Rey, La Unica and White Heather. The offer to also take over their other Cuban labels such as El Rey del Mundo and Sancho Panza, Newman actually declined.
In his biography he later wrote: “I admit: that was a mistake.” The first Cuesta-Rey that was produced under Stanford Newman’s ownership was the “95” (the founding year of the J. C. Newman Cigar Company). Priced at 35 cents, it was one of most expensive on the market. And it was a best seller. It was, of course, made of 100 percent Cuban tobacco. But for how much longer?
The embargo against Cuba was bad news for the cigar industry in Tampa. Even if the stocks would last a while, at some point they would dwindle. “Yes, we still have Havana!” was another one of the ad slogans of the manufacturer Garcia Vega, who wanted to reassure the customers for as long as possible.
The strategy behind it however was just a little too easy to see through: they stored their last bales of Cuba tobacco in the cellar and took pride in them. “Nobody really claimed to still process Havana in the cigars”, Stanford Newman wrote in his memoires. Of course, a bale of Havana leaves was also slumbering away in the Newman’s cellar.
It is well known that Stanford J. Newman was the pioneer in the branch who first recognized the merits of tobacco from Cameroon. Even if the wrappers from Africa were soon twice as expensive as those from Cuba before the embargo, Stanford Newman was convinced of its quality. The success proved him right. Around 1970, Cuesta-Rey was the leading premium brand in the United States.
“In the 1980s, the whole cigar business went down the drain. Sales dropped; the costs, on the other hand, rose, and the competition from the new, aspiring cigar countries like Nicaragua, Honduras, Ecuador and the Dominican Republic increased considerably”, remembers Robert C. Newman, Stanford’s younger son and today executive vice-president of J. C. Newman. He has been in the business since 1975. Everyone calls him Bobby.
The Deciding Year 1986
A milestone in the company’s history is marked by February 14, 1986. On this particular Valentines’ Day the then 70- year-old Stanford Newman and his two sons Eric and Bobby bought up all the company shares from the other family members. “To do it we borrowed a huge amount from the banks,” Eric today laughs about the venture.
Stanford J. Newman was honored for his life’s work in the year 2006 (posthumously) with our magazine’s Cigar Trophy Lifetime Achievement.
In the year 2008, the label Cuesta-Rey was awarded the Cigar Trophy Best Value for the best price/performance ratio of all Dominican cigars.
In 2010, Eric M. Newman and Carlos Fuente Jr. together received Cigar Trophy in the category Charity & Community for their joint Cigar Family Charitable Foundation.
“Some decisions in life you make with your brain; others you make with your heart. It was one of those situations. And for a long time I thought that my heart was blocking out my brain. But today I am happy about our choice.”
Just three weeks after the takeover, the future of the Newmans was radically changed. Carlos Fuente, who had in the meantime established his factory in Santiago, Dominican Republic, and wanted to close his machine-made cigars factory in Tampa, presented a business plan to his friend Stanford.
As is well known today, the two agreed that the Newman family would take over the machinemade production of both family businesses while the Family Fuente in return would produce the hand-rolled cigars of both companies in the Dominican Republic. The first label of the Newmans to come from the Tabacalera Fuente was La Unica Dominican Primeros – by the way, it was the first premium label ever to be sold in bundles. Today it is one of the most-purchased premium cigars sold in bundles.
Cigar Family – A Success Story
On the occasion of the 100th anniversary of the company’s founding, together with Carlos Fuente Stanford Newman developed the Diamond Crown Cigar, the first cigar line with a uniform ring gauge of 54 (up until then, 52 was the thickest cigar on the market). Another milestone.
“In the meantime, the cigar boom was in full swing and the whole world was fighting over our cigars,” Bobby says, remembering the golden years. Every success cast a shadow on the last, even when the boom years were long passed.
Cigar lines such as Diamond Crown Maximus followed, and finally the Diamond Crown Julius Ceaser. “That’s a project of Drew’s, my brother Eric’s son, which he saw through as part of the 135th birthday of J. C. and at the same time the 115th anniversary of the founding of the company. On the cigar ring is his great-grandfather with an olive wreath on his head … very much in the style of Julius Caesar, but nevertheless our Julius Caeser”, Robert explains.
The Future: Perla del Mar & Ponce de León
“Meanwhile, the cigar portfolio has grown substantially and covers many different tastes and price classes”, explains Shanda Lee, vice-president of marketing at J. C. Newman. In the meantime, the popular label Quorum is already represented in 81 countries; the Brick House in 21; Luis Martinez in more than 40 markets.
“For two years we’ve been working on a blend called Perla del Mar”, discloses Eric Newman, and Shanda Lee adds, “The new cigar with a Connecticut Seed wrapper from Ecuador will be coming to the market in four formats in the summer. It’s the first new release from Nicaragua since Brick House three years ago, and will also be established in the same price class. So, that means lots of taste for a very favorable price. And it’s our first-ever box-pressed cigar.”
And the next project? On March 27, 1513, Juan Ponce de León sighted North America (more precisely, Florida) for the first time. The conqueror had already taken part in Christopher Columbus’ second America expedition in the year 1493. For the 500th anniversary, 2013, the Newmans, together with Tabacalera Fuente, want to release a label of the same name. “We’re working on it full steam”, promises Eric Newman, and grins at the objection that Nicaragua is now the cigar country that has every manufacturer’s attention right now. “My father always said: ‘If everybody’s going one way, you go the other.’”
J. C. Newman Cigar Co.
This article was published in the Cigar Journal Summer Edition 2012. Read more