When you've risen to the top of the cigar world, what do you do next? If there's tobacco in you blood, you start all over again, Cuban-style, with your family by your side.
Cuban-born Ernesto Perez-Carrillo became one of Miami's biggest cigar sensations in the early 1990s when his reblended La Gloria Cubana brand captured rave reviews and inspired a cult-like following. Hardly an overnight sensation, Perez-Carrillo's father owned the El Credito Cigar Company in Cuba and re-established it in Miami as a small store-front operation many years later. Tremendous growth and a new Dominican Republic factory followed, but Perez-Carrillo ultimately sold El Credito to Swedish Match S.A./General Cigar Company in 1999. He continued at the helm as master blender until early 2009 when he left to start a new, family-owned cigar company, despite numerous challenges facing tobacco manufacturers. Joined by his son, Ernesto "Ernie" Perez-Carrillo III and daughter Lissette McPhillips Perez-Carrillo, he's going back to basics confident that passionate cigar enthusiasts will find a place in their humidors for his newest blends which, for the first time in his family's history, even bear the Carrillo name on the band.
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[b]SMOKE: You're the third generation in your family's cigar making tradition. How did it all begin?[/b]
PEREZ-CARRILLO: My grandfather started back in 1907, and what they used to do is make cigars in the streets of Cuba. My father came into the business in about 1928, he was 24 years old, and basically he continued it. He was mostly into the growing and brokering of tobacco. His first factory he bought in 1948, which was El Credito, and that's when he got involved in cigar making himself. That lasted until he came to the United States in 1959. He reopened the factory in 1968 - it was a small chinchale - and basically ran it until he got sick. My wife and myself, we were involved in the beginning there, helping him out. In 1980 when he passed away, that's when I started running the company myself.
[b]SMOKE: How old were you when your family left Cuba for the United States?[/b]
PEREZ-CARRILLO: I was seven years old. We had a farm down there, and we'd go out on the farm with him, but I wasn't involved in the growing.
[b]SMOKE: So you first learned the business at your father's Miami factory/store?[/b]
PEREZ-CARRILLO: Exactly. I started working with him in 1968. I got married when I was 19, so needless to say I couldn't really support - my first kid was born when I was 22. So I had a night job; I was a musician.
[b]SMOKE: At the time, music was your bigger interest, though, and not cigars?[/b]
PEREZ-CARRILLO: Well El Credito was such a small business during in '70s - it wasn't anything like it is today. It was something that was being done because my father loved what he was doing and I was helping him out with it, but I really didn't think that would be something I would be doing the rest of my life. I wanted to be a jazz musician.
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[b]SMOKE: What changed your mind?[/b]
PEREZ-CARRILLO: Around 1974, another cigar maker wanted to buy him out, and he asked me to come with them to the meeting, because his English was kind of broken. At that time they offered him, I think it was, $125,000 for the business, but I realized that I really wanted to do this. During the meeting I asked him to step out a minute and I basically told that he won't have to sell the business, that I wanted to be part of it, that I was going to go in full-time with him. That's really when I made the decision to do this, come into the cigar business and make this my livelihood.
[b]SMOKE: It sounds like you'd really had two full time jobs for years.[/b]
PEREZ-CARRILLO: Well, from 1968, the only time I really wasn't working with my father was when I moved to New York City for about six months. All of that time I would come in, there were about 10 or 12 cigar makers at that time. It just wasn't that big of a business at that time. All of the manufacturers here, like Padrón and Camacho, were moving to Central America to make cigars. That was where they were growing their business, while we stayed here in Miami.
[b]SMOKE: What were your predominant responsibilities at the factory?[/b]
PEREZ-CARRILLO: I was mostly doing deliveries and I helped out with the tobacco, getting it ready for the cigar makers. My wife, in the beginning, she used to do the cigar banding. I think what I learned mostly from my father - aside from tobacco and the contacts that he had - was how he treated people. That's what made him special, that everybody loved working for him, because he was such a gentleman. He had such respect for everybody it was really what made people want to work with him, and be a runner. He was a politician in Cuba, so he had some traumatic experiences there.
[b]SMOKE: It's a Cuban tradition for family to help out in a business?[/b]
PEREZ-CARRILLO: Exactly. As a matter of fact, when my father had the business, he would bring tobacco, like the wrapper, home at night and my mother and my aunts would help strip the tobacco and get it ready for the next day. The whole family was involved, in one way or another.
[b]SMOKE: Did you know the entire operation well by the time you took over running the factory in 1980?[/b]
PEREZ-CARRILLO: I had known some, but when you're on your own, it's a whole different ball game. It wasn't the same as when he was around. Now I was in charge, and most of the people who were working at that time were in their 60s, 70s, and 80s. They see this young kid coming in and trying to make some changes. There was some hard times there, but luckily after a while everybody kind of saw that I really wanted to was keep the business going and so everybody kind of pitched in and really helped me a lot during that transition period.
[b]SMOKE: What was the history of your former leading brands, La Gloria Cubana?[/b]
PEREZ-CARRILLO: That's an old brand that goes back to 1893. And it went through different changes; it was once owned by the Rochas family, then they sold it to the Cifuentes, then they bought it right back. So it went back and forth a couple of times back there in Cuba. Then here in the United States we registered it and we owned the brand.
[b]SMOKE: Your business really skyrocketed during the 1990s cigar boom and the company grew tremendously. Why did you then decide to sell it?[/b]
PEREZ-CARRILLO: In 1996 I decided to open up the factory in the Domincan Republic. It was something that I had to do because I just couldn't produce all the cigars I needed - the demand was great, I could never have produced them here in the United States. So we started manufacturing down there. Then in 1997 people started coming to me and wanted to buy me out. I really wasn't interested in doing that; but my kids, weren't involved; they were still going to school, they wanted to do their own thing. So I figured it was a good time to sell, because I couldn't really grow the business that much on my own: I didn't have the corporate experience or the experience organize it the way it had to be. And that's when I decided to sell to Swedish Match/General Cigar.
[b]SMOKE: None the less, you continued to run the factory for another decade, and it continued to grow.[/b]
PEREZ-CARRILLO: Exactly. I worked with them until March of 2009, and it did grow. Every year it would grow a certain percent. And to a certain degree, even when I left last year, it was still in a growth pattern.
Perez-Carrillo's first cigar to debut from his new family-run cigar factory is E.P. Carrill0 Edición Inaugural 2009, a limited edition line with total production slated to top out at 125,000 to 150,000 sticks. The permanent E.P. Carrillo cigar will debut in spring 2010.
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[b]SMOKE: Now you've changed gears again. Why start all over again?[/b]
PEREZ-CARRILLO: I started thinking about it two years before my [contract] date was up. I just wanted to be on my own again. Although these people were very nice to me and I was doing pretty much everything I had been doing before, I wanted to do different things. And my kids started to get excited about it - my daughter is a lawyer and my son is into private equity, but they wanted to get involved in some type of business and that's when we started talking. And I said to them, 'why don't we start this company?' This way, at least this will be something that you have down the road, it will be something that will be your business. Instead of going out and trying to reinvent the wheel - I have the experience making the cigars, you guys have the experience in business - I think it would be a good team here. And then once they said, 'yes,' then it was full speed ahead to try to make this thing go.
[b]SMOKE: Where are you making your new cigars? Do you have your own factory?[/b]
PEREZ-CARRILLO: We're making the cigars in the Dominican Republic, in the industrial free zone there. In April we rented a 40,000 sq. ft. building and we began making cigars there in October. I know a lot of people down there; I have been there now since 1996, so it's like a second home to me. There's a lot of good people down there…hard working people.
[b]SMOKE: How many people do you have working for you?[/b]
PEREZ-CARRILLO: Right now we're starting with about 10 cigar makers for this first inaugural edition, and then as we start our new core brand in April or May, depending on the demand, we're going to be adding on people.
[b]SMOKE: So the first cigar you're releasing is actually the limited edition?[/b]
PEREZ-CARRILLO: That's correct, yes. We're only going to produce, probably, about 125,000 to 150,000 cigars, coming out in allotments of 2,500 cigars per month. It's going to be one size, and once that's gone, that's it. Then we're going to come out with a core brand. At the end of next year, we're going to come out with another limited edition - a different size, different blend of tobacco than we're using now. What we're doing now is using a very unique blend, I think, that's going to be different from the core brand.
It was Perez-Carrillo's desire to create a very traditional Cuban-style blend for his La Gloria Cubana brand in the early 1990s that launched him and LGC into the limelight. Now his family's name adorns his new E.P. Carrillo Edition Inaugural 2009 cigar, a unique blend made at his new Dominican factory.
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[b]SMOKE: One might expect a limited edition cigar to debut much later than your "core" brand. Why is it first?[/b]
PEREZ-CARRILLO: I didn't start buying tobacco until September 2008 when my non-compete was up. I like to buy tobacco and age it at least anywhere from - depending on the tobacco - one to three years. The tobacco I had available - wrapper that had been aged for about three years - is a special wrapper that's being grown for us in Ecuador by the Perez family. It's a different feel altogether than what's out there. It's a Habano seed, but it's different than anything being grown in Ecuador at the present time, or Nicaragua, or Honduras, or anywhere. I'm excited about it; we're going to be the only people using this tobacco. I started thinking about the blends and the different tobaccos that were available - tobaccos that have been aged already for a minimum of a year and half, two years - it was small quantities; we're talking about 29 bales of wrapper, and about 80 bales of tobacco. I fell in love with the blend and this is when we started thinking about a limited edition and this is what we're going to come out with first.
[b]SMOKE: Will this wrapper lend the cigar a very unique taste?[/b]
PEREZ-CARRILLO: I've always believed that the wrapper is 60-70 percent of the complexity, taste, and aroma of the cigar. A lot of people believe the opposite, but I've proven that my theory is the correct one.
[b]SMOKE: How will these cigars be priced?[/b]
PEREZ-CARRILLO: The Inaugural Edition that we're coming out with is going to be a contract brand - no discounting. It's going to retail for about $13 which is not that bad. For the core brand we're going to come out with, we're looking to be in, maybe, the $5 to $9 price range; that's basically what everybody is selling their cigars now for. But to have good tobacco, to really have a good product, it just costs a little bit more to make. To have inventory that's aged for two or three years, you're talking about serious money there. But I think it's worth it. People, once they've tried the product and they enjoy it, they they won't mind paying the price for the cigar.
[b]SMOKE: Both of your children are working with you full-time?[/b]
PEREZ-CARRILLO: Yes, my son [Ernie] is going to be handling the marketing and sales, and my daughter [Lisette] will be handling all the operations down here in Miami, and I'll be in the Dominican most of the time making cigars.
[b]SMOKE: It sounds like a very careful, deliberate start - not rushing the cigars or trying to start too big.[/b]
PEREZ-CARRILLO: It is. I just want to put out good cigars, cigars that are going to make people stand back and say, "this is really nice," and "this is really special." I think there's such an opportunity out there in the market to come out with something different, something special. I think there's a lot of people waiting for something like this. We don't have to sell millions of them - we just want to do this because we love what we're doing, we have a passion for it, and I think there's a market out there looking for something unique. I want to concentrate on making cigars with different tobaccos, different combination of binders, fillers, wrappers. I'm really excited because there's a lot of really good tobacco out there. I'm excited to get started! Enditem
