By Heneage Mitchell

J. Cortès is widely known as manufacturer of quality cigars with its century old rich history and tradition of cigar making. J. Cortès Cigars, Belgium’s prime cigar producer, was established in 1926 by Maurits Vandermarliere. Several decades later, the company has shown a spectacular growth reaching a yearly consolidated production of over 480 million cigars which are sold in over 90 countries worldwide.

Driven by a continuous search for new opportunities, production facilities have been established in Asia. Together with facilities in Handzame and Zwevegem in Belgium, they make up one of the largest family-owned cigars companies in the world. J. Cortès operates three main production facilities: a production facility at Handzame in Belgium, processing and packing facilities at Zwevegem in Belgium and a bobbinizing and production facility in Sri Lanka. J. Cortès factories are certified ISO 9001 and ISO 14001, signifying quality Environment Friendly Processing. Except for a few hand rolled cigars (long fillers) that are outsourced to a South American company, the rest of the company’s products are manufactured in its own production facilities.
“Our own production is almost 99%  in terms of volume and value of product range,” according to Tissa Dissanayaka, J. Cortes export manager for Asia and the Middle East. “In fact we contract manufacture for some major private and famous cigar brands who use our capacity and expertise to make part of their product portfolio.”
The company is even environmentally and socially responsible
 “Where possible we used zero carbon emission solar energy,” Dissanayaka told Tobacco Asia. “For example, our head office and factory in Zwevegem is fitted with a large number of solar panels that generate 220.14 kWp. We practice equal opportunity employment, tolerate no gender discrimination or child labor and we follow all applicable environmental, health and safety standards.”

J. Cortès Market Potential in Asia and Middle East

Country	Duty Free	Duty Paid	Market Potential / Status
Greater China	Yes	No	High
Taiwan	Yes	Yes	Gradually improving
Thailand	Yes	Yes	Medium potential
South Korea	Yes	Yes	Medium Potential
Japan	No	Yes	Medium Potential
Malaysia	Yes	Yes	Gradually improving
Singapore	No	Yes	Saturated
Australia	No	Yes	Limited
India	No	Yes	High Potential
Bangladesh	Yes	No	Medium
Sri Lanka	Yes	Yes	Medium
Maldive Islands	No	Yes	Limited
UAE	Yes	Yes	Saturated
Oman	No	Yes	Limited
Kuwait	No	Yes	Medium
Bahrain	Yes	Yes	Limited
Qatar	Yes	No	Growing
Jordan	No	Yes	Limited

Unparalleled quality
The concern awarded the environment and fairtrade standards is also very much in evidence in the design and manufacture of the products the company offers.
“Unparalleled quality is the key attribute of J. Cortès products. whatever sizes and combination that they are producing,” Dissanayaka told us. “To ensure the highest quality, J. Cortès relies on superior quality tobacco materials sourced from reliable suppliers and well-trained, skilled and motivated staff. We employ state-of-the-art machinery for production quality and consistency and the correct processes to ensure quality output. We seek to continuously improve our portfolio and processes through innovation and new product development.”
J. Cortès’ customers are typically discriminating cigar lovers looking for something special in their smoke. Developing products that appeal to this market is a challenge that J. Cortès continues to meet successfully.
“The end-users of our products are looking for satisfaction,” said Dissanayaka. “They are aficionados, experienced smokers seeking value for money. This can only be achieved by offering the right product, at the right quality and at the right price.”
Identifying needs and preferences of aficionados, making products to such preferences and ensuring the availability of products with consistent quality while continuously improving are the methods that J. Cortès deploy to address these requirements, according to Dissanayaka.
“We understand the needs of the aficionados,” he told us, “and we make products to cater to such preferences, providing quality-consistent products at the right price whilst ensuring effective distribution for easy access.”

 
Sales strategies
Obviously, in ever-darkening markets, the point of sale has become a paramount area for marketing and promotion. To effectively sell a product, the merchant needs support from the manufacturer. J. Cortès products add value to sales outlets through a number or ways.
“Our products are good value for money, and that create a larger customer base and therefore larger volumes for retailers,” said Dissanayaka. “Our products ensure consistent quality which customers can trust and rely on, resulting in repeat purchases for retailers. We have a wide product range that caters to different preference of customers and this is conducive to attracting wider customer base. And where legally permissible we assist and support retailers to increase sales by deploying various marketing methods.”
J. Cortès is no stranger to global markets as it sells it products in around 90 countries on all five continents. Its strongest markets are in Europe, and the company has established its own structure and sales force in countries such as France, Italy, Spain and Benelux. In some countries J. Cortès products are sold in both Duty Free and Duty Paid markets.
Further afield, there are still challenges being met and new horizons to conquer.
“We are gradually increasing our presence in Africa and Asia where cigar culture is at early stages,” Dissanayaka told us.

Logistics
Supplying so many countries with consistent product presents a complex set of challenges. To benefit from economies of scale and to harness synergies, J. Cortès supplies products from its central processing facilities in Belgium.
“We have standardized order and supply procedures to maintain uniformity and consistency whilst allowing room for flexibility to cater to specific customer needs,” Dissanayaka explained. “The logistics procedure is set to ensure that importers and agents will get exactly the right products ordered, in the right quantities, at the right price, on time. We aim for the least logistic cost, so on-time delivery is the key. Our importers and distributors know that they can rely on our deliveries to ensure products are available all the time whist minimizing stock-holding costs.”
This is relevant not only as storage costs and space requirements are reduced for the sales outlet but also because a cigar is best enjoyed relatively shortly after its manufacture.
“It is of the utmost importance that by the time it is puffed by end user, a cigar should retain all the characteristics that it was designed to embody,” Dissanayaka pointed out. “This includes product quality, freshness, aroma, the flavor of the cigar and so on.”
To that end, J. Cortès takes a number of steps to ensure that the quality of its products remains at its peak by the time the consumer lights one up (see table 2).
“J. Cortès has implemented an ERP system known as QAD which gives accurate information on the process and cost of each stage which leads to supply chain efficiencies and production flow,” Dissanayaka added. “Effective planning, collaboration and integration are effective methods that we deploy to increase supply chain efficiencies. The overall benefits include reduced lead times, lowering of inventory cost and increase responsiveness for variances. However, since tobacco is seasonal crop we are holding sufficient buffer stocks of tobacco to meet any seasonal contingencies.”

Packaging and regional concerns
J. Cortès understands that packaging is as important as product quality is. In most cases there is a positive correlation of product quality and package quality. However, there are exceptions where certain retail markets behave differently to others based on individual customer demands, so J. Cortès has adopted a two-fold approach to packaging.
“We employ standardization where possible to achieve efficiency,” Dissanayaka told us. “For example, our Blue Line series carries the same packing format right across the world. But we adopt specialization where needed to cater to specific market requirement, such as where culture sensitivity needs to be taken into account, in which case we change the packaging to gain greater acceptance by local customers. In most cases these changes will be accompanied by slight changes to the product attributes, such as pack size and aroma. In a few specific cases, such as the Greater China Region, we approach the local market with completely new products rather than offering our standard choices.”
Catering to specific markets involves a combination of research and understanding of the specific attributes that are likely to meet with success in any particular country or region.
“Our first approach is to understand the market and the consumer,” Dissanayaka confided. “We try to identify the unique tastes and preference of each segment, country or region.”
Some product variants, including natural tobacco and vanilla flavored brands, are universally accepted. So once the unique market preferences are identified, it is possible to introduce new products to address such specialties, such as cherry or cappuccino flavored variants or sweet wood tipped cigars, for example.
“We may change pack size and pack colors to be more acceptable for particular markets,” Dissanayaka added. For example, we offer larger pack sizes for the Europe market where consumers can afford to buy in volume and save money. Smaller pack sizes are more suitable for Asian markets due to lower purchasing power. Wood tips are the most popular format for our consumers in the Greater China segment.”
Company c.e.o. Guido Vandermarliere recently welcomed the third generation of the family to the company. Together with his son Frederik, he thus ensured that the future of this international tobacco company remains bright.
J. Cortès is sharing stand 3E1 with sister company Gryson at Inter-tabac ASIA, March 15-17, 2012 at the PICC, Pasay City, Metro Manila, Philippines

Deterioration of product characteristics; steps taken by J. Cortès

Causes of deterioration	Steps taken by J. Cortès
Aging	• Periodic and planned sample review of market products and replace when required.
Maintain appropriate humidity and temperature	• Regular market visits to ascertain product conditions at retails, advice retailers on best practices of storage. • Use special packaging to regularize humidity.
Maintain Freshness and Aroma	• Wrapping of cigars packs/tins where needed and wrapping of individual sticks in specific cases. • Use of aromatized packaging for long-lasting effect. • Use of modern technology such as injection methods for greater impact.
Product Quality	• Use of special cold treatment methods to kill any living organism, bugs or eggs. • Where possible, produce products when order is received to give greater product quality and freshness (produce as you get the order)
Flavors and Colors	• Use of quality materials both tobacco and additives. • Use of quality packing materials ensures quality inside. Eg. Metal tubes with cedar wood.