Abstract: China's growing middle class and affluent population are on the rise, as is their demand for luxury goods and high-quality tobacco products. This provides some room for growth in the cigar market. Internationally renowned cigar brands are gradually increasing in the Chinese market, and some high-end cigar stores and liquor stores have also begun to emerge in first-tier cities. These stores offer a wide range of choices and professional services, attracting a segment of consumers. As Chinese consumers' awareness of luxury goods and tobacco culture increases, so does the popularity of cigars in China. Some cigar brands have strengthened their presence in the Chinese market through channels such as branding and social media. In 2022, the output of China's cigar industry will be about 4.566 billion pieces, and the continued sales volume will be about 6.666 billion pieces.
1. Definitions and Classification
Cigar is a tobacco product made from dried and fermented tobacco rolled and smoked by igniting one end and snorting the other end to produce smoke. Cigars can be divided into hand-rolled cigars, half-rolled cigars, and machine-made cigars. Hand-rolled cigars are mostly Cuban cigars and are more expensive; Half-rolled cigars are made by machines that make fillers from bundles and then roll them with bandaged leaves by hand; Machine-made cigars, commonly known as smokers, have a lighter flavor and are suitable for cigar smokers.
Second, industry policies
Cigars are a type of tobacco. According to the current relevant policies, the control of the whole process of production, brand, wholesale and retail in the e-cigarette industry has become clear. This has also created new development opportunities for the Chinese cigar industry. In September 2022, the State Tobacco Monopoly Administration issued the Notice on Matters Concerning the Strengthening of E-cigarette Supervision to regulate the development of the national tobacco and other industries.
3. Industry barriers
1. Restrictions of laws and regulations
China's tobacco market is subject to strict regulation and regulatory control. The tobacco industry is a state-owned monopoly in China, and cigars are subject to the same regulation as a type of tobacco product. As China has clear restrictions on the advertising, sales channels and sales of tobacco products, this poses a challenge to the marketing and sales of the cigar industry. In addition, the production and sale of cigars also requires specific licenses and approvals, which increases the barrier to entry into the market.
2. Limitations of culture and consumption habits
Chinese consumers' awareness and acceptance of cigars is relatively low. In China, tobacco consumption habits are mainly cigarettes, and cigars are not common as high-end tobacco products. In addition, cigar culture has not yet been formed in China, and many consumers do not have a deep understanding of the brand, quality and appreciation skills of cigars, which limits the popularity and acceptance of cigars in the Chinese market.
3. Import tariffs and price factors
Due to China's high import tariffs on tobacco products, the cost of importing cigars is relatively high, resulting in higher selling prices and limiting the willingness of the average consumer to buy. At the same time, the price of high-end cigars is also a challenge for the Chinese market, which may be hindered by the relatively expensive price of cigars due to the country's income levels and consumption habits. Therefore, reducing import tariffs, pricing rationally, and increasing consumer awareness of cigar quality and culture are all obstacles that need to be overcome.
Fourth, the industrial chain
The structure of China's cigar industry chain is relatively clear, and the upstream is raw material suppliers, including tobacco leaves, tobacco making equipment, cigarette equipment, etc.; In the middle of the industry, cigar manufacturers are mainly engaged in cigar processing; The downstream of the industrial chain is the sales channel, mainly including supermarkets, tobacco and alcohol stores, e-commerce platforms, etc.
Note: This article is transferred from the Zhiyan Industry Encyclopedia platform, if you need to get more industry information and customized services, you can enter the Zhiyan Consulting search to view.
Zhiyan Industry Encyclopedia is a production and research tool platform launched by Zhiyan Consulting, which is committed to providing you with a full range of encyclopedic industry information query services. Zhiyan Consulting practices the corporate mission of driving industrial development with information, improves and enriches enterprise methodology, relies on the industry encyclopedia platform to enhance the value of information, and continues to empower industry development and enterprise investment decision-making. As a one-stop systematic research tool for the cigar industry, the Cigar Industry Encyclopedia comprehensively summarizes the knowledge and information of the cigar industry, covering the definition, classification, policy, industrial chain, competition pattern, development trend of the cigar industry, etc., and relies on information technology to establish an intelligent inter-chain industry knowledge graph, providing in-depth insight and comprehensive information for industry research practitioners and relevant investors.
Zhiyan Consulting takes "using information to drive industrial development and empower enterprise investment decision-making" as its brand concept. Provide professional industrial consulting services for enterprises, including high-quality industry research reports, special customization, monthly topics, feasibility study reports, business plans, industrial planning, etc. It also provides weekly/monthly/quarterly/annual reports and customized data such as regular reports, covering policy monitoring, corporate dynamics, industry data, product price changes, investment and financing overview, market opportunities and risk analysis, etc.