Cigar economics

JZerby

my question is simple: how is the price of a cigar determined? I walked into CVS today and noticed their Blend Masters or whatever junk they carry are between 3 and 9 dollars for singles. But the same holds true for the cigars in the local Tinder Box store (although they go further up into the $28 range for the most expensive. But the $3 cigars at Tinderbox are things like Punch and I think a Romeo Y Juliet. How can a cheap drug store cigar cost the same as Punch, which is far superior?

jlmarta

The correct price for anything is whatever someone will pay for it - regardless of what the item is.

Krieger

jlmarta:

The correct price for anything is whatever someone will pay for it - regardless of what the item is.

this

allsmokedup

Price discrimination

Gray4lines

Price doesn't always equal value. Also, price is used to set the expectations of the consumer. If you see a $3 it is presumably better than a 3 for $1 swisher and not quite as good as an $8 tatuaje. So while price can reflect the inputs used, cost of goods, biz model of the manufacturer, markup of retailer, and tax, sometimes companies just price to be competitive ie in the same "price" category. Its as much marketing as economics

y2pascoe

I went to a cigar louge in the North End of Boston and the OpusX's were listed as being "Market Price", like they were shellfish or something. So I asked the waitress what they were selling for and she told me, "$78 a piece". Wrap your brain around that one.

Steve2010

y2pascoe:

I went to a cigar louge in the North End of Boston and the OpusX's were listed as being "Market Price", like they were shellfish or something. So I asked the waitress what they were selling for and she told me, "$78 a piece". Wrap your brain around that one.

Sad, but true. As long people will pay it, they'll charge it.

jgibv

skweekz

y2pascoe:

I went to a cigar louge in the North End of Boston and the OpusX's were listed as being "Market Price", like they were shellfish or something. So I asked the waitress what they were selling for and she told me, "$78 a piece". Wrap your brain around that one.

I think I would have actually laughed at them on that one.

Gray4lines