Last week the Food and Drug Administration changed the rules on cigar manufacturing. They proposed to bring in new legislation that would have cigars regulated in the same way that cigarettes are; the whole process predominately funded by the factories themselves. This would add one more layer of overhead to the existing list for manufacturers of cigars. The legislation sounds like a good idea as anything that will make our country healthier is surely a good thing. What this means in reality is that the last remaining and most famous of the Tampa “Cigar City” factories could be forced to close.
In the 1920s Tampa had over 150 cigar factories. Nowadays, J. C. Newman Cigars is the only one left; the last remaining link to the city’s cigar legacy. With the increased cost of testing and studies to secure the FDA approval, the old factory could go out of business all together. This is a shame, but you can’t ignore the steps that led to this eventual decision. This wasn’t just a whim of the FDA that they suddenly put into practice with no warning. What J.C. Newman should have been doing was planning their escape plan.
Cigarettes and smoking have been big news for the last thirty years. Regulations have changed and laws have been enacted. When smoking in bars was made illegal you had to know that the world was changing. Although cigars are different, they still fall into the same category as cigarettes. From day one, J.C. Newman should have been thinking about what to do should the laws ever change and how it would affect their business.
It is a fact that the market place changes. Anyone that thinks they can continue on forever doing the same old thing is just kidding themself. Sometimes companies need a big shake up and sometimes they just need to keep their ear to the ground. All companies need to be thinking about the future. What is happening in your marketplace and why aren’t you at the forefront of it?
I have over 35 years of financial experience working in several different industries. What has been the common factor in all of these positions was planning for the unexpected and thinking of alternative perpetuation routes. For example, if J.C. Newman had sold to a big multinational, they could have had the means to deal with the FDA while still focusing on the little factory that had made their name. What is happening in your industry and what are you planning to do about it? The manner in which customers and insurance carriers are compensating insurance brokers will change. Are you ready to deal with the consequences of those changes and the impact on the value of your agency?
