Business: Re-enters the 5-Center

The late Vice President Marshall, when asked what the nation’s most urgent need was, replied, as everyone knows: “A good 5-cent cigar!” Many tobacconists and tobacco consumers have agreed with him. The rise of wages and material prices during the War rendered the former “popular-priced smoke” much more expensive. The result was a drastic curtailment in consumption. In 1917, over 8 billion cigars were consumed in this country. By 1921, the 5-cent cigar had disappeared, and consumption of cigars declined to about 6¾ billion. Even yet, not quite 7 billion cigars are consumed each year. One consequence of the situation has been that cigar-makers alone among tobacco manufacturers have experienced hard times. Now, however, the cigar outlook is growing brighter.

One effect of the depression has been the elimination of small cigar-makers. Before the War, there were thousands of small and purely local cigar-makers; it took 300 companies to produce 50 per cent of the annual supply. At present, 22 cigar companies are making 65 per cent of the supply, with the prospect that in five years more ten companies will do 90 per cent of the business.

This increased production per unit has led to great improvements in cigarmaking machinery, thus releasing makers from many irksome union restrictions and cheapening costs. Large cigar-makers are consequently planning national advertising campaigns to obtain national distribution of their products. They predict that within a few years the 5-cent cigar will once more be a staple U. S. product, of good quality and huge demand.