My store is opening a lounge but we need some help...

[Chainsaw13]

Excellent advice Ninja. We happen to have a JR's shop here in the Detroit area. Over the years I've become friends with the manager. Once asking him why the shop didn't expand or move to a larger building and put in a lounge, his philosophy was that it took up floor space for more cigars to sell. Basically if it's something you want to provide to the customer, don't look at it as a money maker.

Also from my personal observations, shops that charge you to use the space don't last long. The few around here that have are now closed up. Others that don't charge seem to be doing just fine, but then they carry the stock people want.

[dwoodward]

Keep in mind this is an extension to your store. If your place is appealing it will bring in more business for your store as well. That's always a plus.

[Islayphile]

Put me in the Do Not Charge for usage of the lounge crowd.

There's no better way to keep a new customer than to sell them a cigar and offer them a place to smoke it right then and there if they wish.

Even if they don't smoke there the first time, they will come back and often with a friend.

Simply make it known that all you ask is that they at least buy 1 cigar from you before using the lounge per visit.

Locker fees, bottle storage etc.. is where any ancillary charges should come in.

[Subvet642]

Personally, I like the stripper idea.

[BHalbrooks]

Originally Posted by ysr_racer

Free wi-fi too.

You don't need to make a lot off the lounge, it's just a way to get/keep customers in your shop.

I like the "1 cigar minimum purhcase" idea.

Exactly.

Originally Posted by ysr_racer

Do not, I repeat DO NOT charge a cover charge.

A couple Members have hit the nail on the head. If I were to go to a store that demanded I pay a cover charge, whether it's $200, $500, $1000, they can go **** themselves.

Originally Posted by Subvet642

Personally, I like the stripper idea.

[Bill86]

Originally Posted by ninjavanish

I think charging for lounge usage is a bad idea.

I've worked at several (highly profitable) cigar stores over the years and none charged for lounge use.

We always rented lockers. And on occasion, the lounge would be reserved for locker members only events. However, if a non locker member wished to attend the event, they could pay a month's equivilant locker fee which would grant them access to the day's event. Typically they would need to RSVP/pay in advance so that beer/pizza/etc could be purchased in sufficient quantity for these member's only events.

The bottom line is... you're selling cigars. Not your lounge. Cigars are where you profit comes from. Not your lounge. Budget the amount of money you spend. Come up with a solid purchasing system that gives you a high level of control and visibility on the outflow and inflow of money and allows you to forecast your sales and profit. Rather than creating new fees for using the new lounge area, consider cutting the bottom line first. Order fewer cigars, less often. Cut SKU's that aren't moving as quickly as you'd like, try to contact some of the companies and see if they will credit you for returning product that hasn't moved in recent months... That last thing you want is a ton of money tied up in stock that sits on your shelves forever. If it hasn't moved in 6 months. Ditch it.

I'd recommend purchasing the services of a CPA if you haven't already.

The primary reason for creating a lounge area is to engage your customers. Show them a high level of customer service, and provide an experience that will keep them coming back to purchase more cigars.

As I was reading through the posts this is exactly what I wanted to say. Ninja hit the nail on the head.

A lounge area is a service to the customers to keep them in your store. You can't charge for a lounge if you want people coming back. You can however sell whatever drinks you are allowed to. Coffee, tea, water, sodas, beer and liquor if you can.

Lockers are a great idea too as mentioned. Charge people a few bucks for bringing in liquor if you can't sell it. Something like $5 or so for a bottle. Locker fees would allow them to avoid this charge. Things like this will gather more customers, their friends, and have them smoking 2-3 cigars each instead of buying a few and leaving. Customers that are regulars will make friends and have another excuse to stop by.

You really just need the space, a few TVs, and a couch. Couple chairs and tables as well. The smoke eaters will be what costs you a bit. Proper air flow as well.

The lounge also gives you additional time to converse with customers, which is where you can educate them and help them with any problems they incur while making sales at the same time. I've sold quite a few lighters and cutters after fixing them for customers. It's always bad butane, another sale by the way, purge the lighter with the mtx scissors toss some Xikar/Vector in it done deal. Customers will frequent your store more often if you have the time to spend with them.

After having the lounge you'll need to create events to bring people in. Regular poker nights with prizes work well. Fantasy football sign ups too. Once you have the lounge you want to always have people there. A dead lounge is a dead shop, people will leave.

FWIW, just my experiences.

I also agree that it would be a bad idea to charge a cover. I personally wouldn't go if I had to pay. But, when I go to my local shop, I always buy something and it's usually more than I planned .

[emopunker2004]

Originally Posted by ysr_racer

Free wi-fi too.

You don't need to make a lot off the lounge, it's just a way to get/keep customers in your shop.

I like the "1 cigar minimum purhcase" idea.

Or a $5 cutting fee if you don't buy anything but bring your own.
You planning to serve beer/wine/liquor? Food?

This is my local http://islandgirljax.com/

If you really want to know how to build/run a lounge, buy a ticket to Ft. Lauderdale, drive to Margate, and check out The Smoke Inn. These guys have got it right.

http://www.picturetrail.com/sfx/album/view/23997425

Cover charge? No way I'm paying you money to pay you money.

Like someone said, keep me there long enough and you'll get plenty of my $$$

[BHalbrooks]

[cjhalbrooks]

Originally Posted by ysr_racer

The Smoke Inn. These guys have got it right.

that is my future man cave

[jcruse64]

Originally Posted by Islayphile

Put me in the Do Not Charge for usage of the lounge crowd.

There's no better way to keep a new customer than to sell them a cigar and offer them a place to smoke it right then and there if they wish.

Even if they don't smoke there the first time, they will come back and often with a friend.

I'm with you. I get down to Nashville, TN every few months or so. First store I found to shop in was Uptown's. While I did not make a major purchase on my first visit, I did buy several singles that I can't get in our small town's B&M, and had time to light one up after the sale. I asked if the lounge was free to use, or members-only or by fee, and they said "light up, it's free for ALL cigar smokers". Now when I come to Nashville, I always make it a point to stop in and shop, and usually do not stop with one box. I've also brought my brother in with me, because of their policy. If they had refused me the first time I visited, it would have been the last money I would have spent there, no matter what they carried. My purchases wouldn't make or break them, but multiply me by 5, or 10, or 50, and it adds up over 12 months.

I can definitely understand making visitors pay for any drinks, food, or a cover for special events though. Being generous is one thing, but being unfair to your regular customers is not wise.

Good luck! I love a great lounge.

[cjhalbrooks]

Originally Posted by jcruse64

I'm with you. I get down to Nashville, TN every few months or so. First store I found to shop in was Uptown's. While I did not make a major purchase on my first visit, I did buy several singles that I can't get in our small town's B&M, and had time to light one up after the sale. I asked if the lounge was free to use, or members-only or by fee, and they said "light up, it's free for ALL cigar smokers". Now when I come to Nashville, I always make it a point to stop in and shop, and usually do not stop with one box. I've also brought my brother in with me, because of their policy. If they had refused me the first time I visited, it would have been the last money I would have spent there, no matter what they carried. My purchases wouldn't make or break them, but multiply me by 5, or 10, or 50, and it adds up over 12 months.

I can definitely understand making visitors pay for any drinks, food, or a cover for special events though. Being generous is one thing, but being unfair to your regular customers is not wise.

Good luck! I love a great lounge.

i need an addy please

Our lounge in Austin is a private lounge except for the retail. Members pay an initiation fee of $1000 then monthly $150. Members have access to the a bar supplied with top shelf labels, locker for cigars and wine, 20% off Cigars. Lockers are located in private walk in humidor. Members are allowed one guest but anymore you pay $50 fee if they want access to bar if not $25. The lounge is very nice and offers private meeting room. Two large screen TV's with all amenities. Sounds expensive but there are approximately 71 members. Keeping it private has brought in a higher end spender and being next to the Capital we have numerous politicians, lobbyist. The owner has some very nice hidden perks as well.

[ninjavanish]

Originally Posted by Bucking W

Our lounge in Austin is a private lounge except for the retail. Members pay an initiation fee of $1000 then monthly $150. Members have access to the a bar supplied with top shelf labels, locker for cigars and wine, 20% off Cigars. Lockers are located in private walk in humidor. Members are allowed one guest but anymore you pay $50 fee if they want access to bar if not $25. The lounge is very nice and offers private meeting room. Two large screen TV's with all amenities. Sounds expensive but there are approximately 71 members. Keeping it private has brought in a higher end spender and being next to the Capital we have numerous politicians, lobbyist. The owner has some very nice hidden perks as well.

This is an example of the high-end extreme.

These types of lounges are highly exclusive and very few and far between. There maybe less than 100 cigar lounges of this type nationwide.

Judging from the type of store it sounds like you the OP have... this type of lounge is an absolute no-go for you, the OP until you have an extremely sound financial scenario. Judging from the query you posed as to how to afford a lounge, this is not the route you should pursue. That's not to say that some day you can't get to this level... but there's a hell of a lot of work involved to get you there. Unless of course you are independently wealthy.

[hammondc]

Originally Posted by Bucking W

Our lounge in Austin is a private lounge except for the retail. Members pay an initiation fee of $1000 then monthly $150. Members have access to the a bar supplied with top shelf labels, locker for cigars and wine, 20% off Cigars. Lockers are located in private walk in humidor. Members are allowed one guest but anymore you pay $50 fee if they want access to bar if not $25. The lounge is very nice and offers private meeting room. Two large screen TV's with all amenities. Sounds expensive but there are approximately 71 members. Keeping it private has brought in a higher end spender and being next to the Capital we have numerous politicians, lobbyist. The owner has some very nice hidden perks as well.

Damn. I need to come up and be your guest.....

Another vote for no charge lounge. There are a few here in SA and onyl one charges. I have never seen many folks in there.

Originally Posted by Bucking W

Our lounge in Austin is a private lounge except for the retail. Members pay an initiation fee of $1000 then monthly $150. Members have access to the a bar supplied with top shelf labels, locker for cigars and wine, 20% off Cigars. Lockers are located in private walk in humidor. Members are allowed one guest but anymore you pay $50 fee if they want access to bar if not $25. The lounge is very nice and offers private meeting room. Two large screen TV's with all amenities. Sounds expensive but there are approximately 71 members. Keeping it private has brought in a higher end spender and being next to the Capital we have numerous politicians, lobbyist. The owner has some very nice hidden perks as well.

WOW !! Way out of my league.

[Islayphile]

Whatever route you choose you MUST stay with that decision.

The lounge I frequent started Free, but somewhere along the way the owner was kicking the idea around of starting to charge some sort of fee because of folks taking advantage by not buying any cigars from him and bringing only their own or worse, cigars they purchased from his direct competiton.

I told him it was far better to simply just handle the offenders by barring them further access to his lounge, and since they weren't buying their sticks at his place to begin with, he wouldn't really be losing any customers.

Weigh your options first so that you don't alienate anyone later on.

[hotreds]

I guess it also depends on what you mean by "lounge." Obviously if it's a few chairs in a corner of the shop, that's one thing. If it is a separate entity with chairs, tables, TVs etc, then I think you could charge for that kind of a thing.

Free, but definitely NOT BRING YOUR OWN CIGARS. Do you bring your own food to a restaurant?

Speaking of restaurants, I'm in Chicago for the weekend. There are two delis I like to eat at. One of them has free wifi, guess which one I'm at right now?