TABOCA AS TROUBLES

[aj01]

I was just sent by a friend an article from a Norwegian newspaper that Taboca AS has undergone a major re-organization. Through my own connections I know the American CEO is out, as is the founding partner who brought the Cuban licenses to the table. The Chairman of the Board has resigned, and new one (ex-Swedish Match Norway) has come in. The new CEO is a Norwegian accountant with no commercial acumen.

The association with Nordic American no longer exists, and in the article, the outgoing COB blames the US market investment for the company's losses (US $20m over 5 years). The US was a money pit for Taboca, and the Scandinavian business ran on bare bones to fund Nordic American's pre-startup production and promotion investments. It was all done in good faith. No-one expected this recession.

One rumor coming through the industry is that the new management "team" is tasked with wrapping it all up and shutting it down. Though the Norwegian article predicts a quick turn to profit without the US burden, closure is a possibility, with the snus licenses for Montecristo and RyJ reverting back to Imperial/Habanos.

Regardless, as some of you know, I ran Scandinavia for Taboca in 2007 and half of 2008, and it's tough to watch this, knowing the folks at the factory and on the ground. It's a really small company with about eight in the factory and the same in the sales force. The snus is good, and the fight has been taken to retail with gusto and tenacity thanks to Per and the team.

Here's hoping that, whatever the outcome, everyone lands on their feet.

[lxskllr]

Re: TABOCA AS TROUBLES

I was just sent by a friend an article from a Norwegian newspaper that Taboca AS has undergone a major re-organization. Through my own connections I know the American CEO is out, as is the founding partner who brought the Cuban licenses to the table. The Chairman of the Board has resigned, and new one (ex-Swedish Match Norway) has come in. The new CEO is a Norwegian accountant with no commercial acumen.

The association with Nordic American no longer exists, and in the article, the outgoing COB blames the US market investment for the company's losses (US $20m over 5 years). The US was a money pit for Taboca, and the Scandinavian business ran on bare bones to fund Nordic American's pre-startup production and promotion investments. It was all done in good faith. No-one expected this recession.

One rumor coming through the industry is that the new management "team" is tasked with wrapping it all up and shutting it down. Though the Norwegian article predicts a quick turn to profit without the US burden, closure is a possibility, with the snus licenses for Montecristo and RyJ reverting back to Imperial/Habanos.

Regardless, as some of you know, I ran Scandinavia for Taboca in 2007 and half of 2008, and it's tough to watch this, knowing the folks at the factory and on the ground. It's a really small company with about eight in the factory and the same in the sales force. The snus is good, and the fight has been taken to retail with gusto and tenacity thanks to Per and the team.

Here's hoping that, whatever the outcome, everyone lands on their feet.

That's too bad. Taboca made a first rate snus, and it's never good when Swedish Match loses competition. I hope they can make it through this, perhaps smaller, but still around.

[justintempler]

I read Larry Waters story on it yesterday, what a mess.

http://www.snuscentral.org/snusnus/m...dd-leaves.html

[justintempler]

Found a story in Norweigen here:
http://e24.no/boers-og-finans/article3288013.ece

They've invested 115 million kroner since 2004
They have yet to turn a profit
Last year they lost 28.6 million kroner (over $4,000,000 loss in one year)

One big money pit.

[lxskllr]

I wonder how hard it would be to make money and be a very small producer. Just keep everything on a small scale, and expect to make a living, but not get rich. Going up against SM seems like a losing strategy to me. I think it would be better having a niche product, and cater to people that SM doesn't go after.

If I were running Taboca, I would have emphasized the premium quality, and even created an artificial scarcity. Keep the prices high, and make people think it's worth it. There's plenty of boutique products that do well without volume sales.

The American snus was a complete disaster. We don't need another dip brand here. That market has enough competitors to fight over the share US Smokeless doesn't sell. The American snus should have been identical in every way to Swedish snus, but perhaps made in a facility over here. No sweetness, no stupid flavors, just snus. You then have the task of telling people why that's better. Sell it at a premium price, and differentiate yourself at the high end.

[RobsanX]

I would be disappointed to see Taboca go. Their snus has a stand out flavor that I really enjoy, and I would hate to see another snus maker go under.

[bigbuyer]

I like Tobaca as one of my regular snuses. I hope they can figure something out instead of going out of business.

That would be bad for all of us.

[Snusdog]

Well crap!!

Finally a descent stark mini and now it looks like its going to be yanked. :x

[Anthony]

Guess now's the time to order it all up... Wonder if someone else will pick up the Habanos license.

[chadizzy1]

Guess now's the time to order it all up... Wonder if someone else will pick up the Habanos license.

Swedish Match? I know they have their hand in cigars already.