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Cigar.com: AJ, thanks for taking the time to meet with me. As one of Nicaragua's largest manufacturers, in just five years, I know you have a lot on your plate.
AJ Fernandez: My pleasure. I always have time for Cigar.com, you guys are a big part of the reason I am where I am today. If you had not discovered me when I was in my first small factory, I may still be there today.
CC: Speaking of factories, you guys are building a new one, no?
AF: Yes, we purchased the land, started the surveying and architectural plans, and hope to break ground this winter. The facility will be state of the art with pre-industry (fermentation), sorting, stripping, production, aging and packaging all under one roof. While it will be one of the largest, if not the largest, factories in Estelí, we are using a simple design. Other new factories are massive and a lot of money was spent on the exterior of the buildings. They look like palaces. For me, I want to keep it simple. My father and my family always taught me the virtue of humility. While we are fortunate to be where we are today, I won't soon be forgetting where I came from. My hope is that by building something manageable, something we can continue to grow into, we can keep the overhead down by avoiding all the extras and focus on keeping our costs down. Our clients can then get the best possible prices and pass along the savings to the end consumer. Cigars are such a wonderful part of life and as luxurious as it is, I want to make sure they are available at a price that can make a good premium product available to anyone who shares my love for my product.
CC: Well, you did splurge a bit on the new house you guys are building on the grounds for your visitors. I drove past it the other day and it's a monster.
AF: That's not part of Tabacalera Fernandez. I spent my personal savings to construct the house and the cost of which will not be factored into my cigars. I built the house because I want more people to come to Nicaragua and see what we are doing and have a comfortable place to stay. For many, Estelí is not a "destination" and the hotel here is comfortable but not great. It is important that my guests have a place to stay, smoke and enjoy rum near the factory. It is a bit funny because some people in town know I invested my own money in the guest house and they don't understand because it is considerably bigger than my own home where my family lives nearby. Like I said, I am a simple man and don't require much, so when I can invest in what we are doing with tobacco and try to find ways to bring people here to learn about our philosophy first hand, I will go to great lengths.
The guest house, as you mentioned, is practically inside the factory grounds and will have 12 bedrooms. The living room space is set up like a cigar lounge and after a day at the factory, our guests will have access to a pool, a fully stocked bar and even a basketball half-court that's lit for those late night games of HORSE. You gringos get competitive when you get together...
CC: What will you gain by moving into your new facility?
AF: We need to get everything under one roof. Like I said, I am grateful and thank God for our success but we have grown so fast that we have spread ourselves out all over town. For example, right now, we have farms and barns in Estelí, Condega, Jalapa, Ometepe, Ecuador and soon in Honduras. To process the tobacco once it all arrives in Estelí, we have 6 warehouses and another 3 for aging. Once the tobacco is ready, it is sent to both of our factories, which at present are making a combined 35,000 cigars per day. This move will centralize everything except for the farms and barns of course. Now, all the fermentation and processing will be done right where the cigars are made and instead of two factories we will have one that we can grow into and produce up to 60,000 cigars a day.
CC: Since you're so spread out now, I imagine it makes it tough to manage.
AF: It surely is a tremendous amount of work...
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