We’re excited to introduce you to the always interesting and insightful David Haddad. We hope you’ll enjoy our conversation with David below.
David, looking forward to hearing all of your stories today. Let’s start with a story that highlights an important way in which your brand diverges from the industry standard.
Fumar Cigars was born in the 1995 cigar boom as a solution to the Luxury Resort/High End Golf club needs for cigars and a service to provide them a consistent and dependable program, using the best in class of PREMIUM cigars, with a custom humidor and on consignment on premise service. Previously, I had spent 20 yrs in the hospitality industry in concept development, resort operations and private ownership. With a history in the industry we planned on serving, my insight to the guest, what they would be willing to do (spend money on) was a unique perspective, singular to me. I knew who would listen at the resort world. It wasn’t about being a traditional vendor or a cigar store owner, it was being a partner and investor. In the past, and still today, every other option for the resorts and golf clubs has and had been sales-oriented vs service oriented. We delivered, we managed and maintained and taught their staff how to sell what they have using a language the staff/management would be able to use and provide excellent service. We evolved quickly to add on site cigar rolling shows and interactive engagement for corporate and wedding clients, making a tremendous impact, Now serving over 400 resorts in 39 markets, 17 states and offices in Florida, Southern California, Texas and in Phoenix Az. We perform over 400 cigar rolling shows, do in house custom labeling for all occasions and use over 500,000 cigars a year, with a growth in our 29th year of 27% year over year!
David, love having you share your insights with us. Before we ask you more questions, maybe you can take a moment to introduce yourself to our readers who might have missed our earlier conversations?
As a young man, in high school, I was in theater, President of my class and an accomplished golfer. I decided to go to College at the University of Denver, the only place in the late 1970’s you could earn a BSBA in hospitality management. As I often speak at universities to graduating classes in Hospitality Management, I speak of the “accumulation of skill sets”. Over a lifetime, each of us are exposed to many different talent sets, learn many different arenas of ideas and ethics. My deep desire to run my own business and unique perspectives on how the hospitality industry engaged the senses of their guests through food, beverages and experiences allowed me to see what others had missed. A gaping hole in this little corner of luxury lifestyle was a huge opportunity. Our unusual way of deploying exclusive products and services, bringing what was a nuisance request (a guest looking for a great cigar), the hotels/golf clubs having zero expertise in the product, being at the mercy of a local cigar store owner, and turning it into a sizeable revenue stream as a force multiplier for their liquor sales and “owning” the guest for an additional 45 minutes to to an hour, was a language our resort partners could appreciate. We became their in-house expert.
The extraordinary “lift” required in the early years both financially and creatively was enormous. I was in a wheelchair for 2 of the first 4 years of FUMAR, with a very rare circulatory disorder rendering my femurs (leg bones) dead. Desperation was the prime motivator. I needed to be efficient, calculating and rigorous in my work. Finding likeminded people that could support me as employees was a challenge. I chose to never hire anyone from the Cigar Industry, only hiring my team from luxury hospitality. This assured me that all the staff would KNOW how to deal with our clients. How to be pleasant and uplifting and deliver a SERVICE, vs just be salesmen. Being an Entrepeneur is/was selfless, terrifying, and filled with anxiety for me and my family. It took its toll on my children and my wife, chasing receivables, growing exponentially, constant travel and singular focus. We made it and that is what makes me most proud. By example, my wife and I demonstrated to our children that only hard work, perseverance and an unfailing discipline to your goals was going to make you a success. My children are grown, 2 are scientists and one is a hard-working HVAC man. I lost my wife to cancer in 2020. My greatest belief is that it was the adversity that made me and my kids strong, so embrace the SUCK! No one will ever know success without the setbacks, struggles and sweat.
Do you have any stories of times when you almost missed payroll or any other near death experiences for your business?
There are 100 plus stories in this category… Payroll: gave up being paid myself over 500 times to make sure I paid my staff. Now I pay them early every paycheck.
Close calls: In the early years, around 1998, I had won my first major whale of a client, the largest and most luxury resort in the Phoenix metro area, the Phoenician resort. It was a HUGE milestone, with a revenue stream that changed the way my family lived, giving us breathing room. It constituted over 60% of my revenue. I was as proud as a peacock! My swagger let me rest on my laurels. About a year in from the start, I heard through the grapevine that the hotel was “Shopping” me and my service. I was terrified, I stood to lose everything. I went to the property every day and made sure the leadership saw me detailing the humidors, arranging products and teaching staff. For 2 weeks I had sleepless nights. We got past it, but, I learned a valuable lesson. Never have all your eggs in one basket. I decided then to borrow as much money as I could, from family, my home equity and the SBA (over $700,000 total) and expand as quickly as possible to diminish the value of the one account. I figured out that NO ONE account or group could control more than 4% of my revenue in order to survive. This is a blessing and a curse, for the next decade I had to dig out from the debt. It worked but had a ton of pain as a daily reminder of the goals.
Near death: The economic crash of 2007-2009. Nearly 100% of corporate travel and lavish lifestyle ground to a halt. I lost nearly everything again. We ground it out, developed new markets (wedding business as an example), expanded to new locations and diversifies our offerings to include custom amenities, private labeling and more. All of these serve as the expansive revenue streams of our future.
How’d you build such a strong reputation within your market?
In all of our business life, we never used a contract. My word was my bond and never failing to deliver was the key to the loyalty of our customers/clients. I told the client what we would do for them, elevate, reimagine and deliver results in this corner of their property, and all I needed in return was their being an advocate/willing accomplice in the program and pay me on time. If they were ever unhappy with our service, we would take our toys and go home, no notice. I wanted to make it extraordinarily easy for them to say YES to our program. What I discovered over time was that our business model was one of a kind. All their other options were less successful, albeit cheaper, but delivered less results and revenue. Our consignment and custom humidor creations were a HUGE barrier to entry for any other competitors. No one else would invest up front thousands of dollars on the expectation that the ROI would be so great and longlasting. Since our beginning, we have lost only 10 accounts, 4 came back within a year. Our ability to network into new accounts was blessed with the constant changing of managers and leaders at the resort/golf world. The old managers would take us to their new properties, and we made friends of the new ones, which would move on and take us with them. We grow organically.
Contact Info:
- Website: www.fumarcigarsusa.com
- Instagram: fumarcigars
- Facebook: Fumar Cigars
- Linkedin: David Haddad
- Yelp: Fumar Cigars