Famous Smoke Shop…Since 1939

By Nancy Moffett
Photo by Ryan Hulvat

Famous Smoke Shop (FSS) moved to Forks Township in 2000 after existing in Manhattan for 61 years. What began as a 350-square-foot retail shop at 1433 Broadway has grown into a large internet/mail order business that also includes a restaurant and a retail store.

Arthur Zaretsky, president of FSS, grew up in his parents’ store where they sold cigarettes, candy, cigars, magazines and newspapers to people coming and going to work in the busy garment center. After a stint at City College, Arthur began working in the store in the mid-‘60s when his dad, David, became ill. He, his mom Rose, and his uncle Phil ran the business together.

“We knew our customers by name,” Zaretsky says. “When many of them began retiring to Florida in the 1970s, they would call or write asking us to send them their favorite cigars.” That’s how FSS’s mail order business began. “We would send out about five boxes a week in those days,” he explains. In 1972 he purchased an IBM Selectric Composer – the first desktop typesetting machine – to produce catalogs for his growing list of mail order customers. The Composer was a mechanical precursor to today’s digital computer-based composition tools and required the operator to type text twice to achieve justified columns of type.

“Little by little, our mail order business grew, so that by 1982 we bought our first computer system to produce catalogs,” Zaretsky recalls. “We still have customers from those days.”

Several factors combined to make Zaretsky think about moving out of New York. “In 1985 Governor Cuomo wanted to tax cigars at 15 percent on top of an eight-and-three-quarters sales tax. “One of our biggest competitors, JR Cigars, was in New Jersey where there was no tax, so we found it harder to compete,” he explains. By then, mail order sales were 25 percent of the business, so they advertised in the Wall Street Journal, the New York Post and the Times to spur more growth.

“You don’t inhale a cigar. It’s almost like you sip it. It’s a sensual, oral and olfactory experience that lets you relax and forget your cares.”

By 1998, FSS had outgrown its space and needed to expand. At the same time, the cost of doing business in New York had also grown. “We chose Pennsylvania by serendipity,” Zaretsky says, “because it has no cigar tax and the cost of building was reasonable.” He chose the Lehigh Valley in particular because FSS was welcomed and courted in a businesslike way versus other areas he explored. There are also many talented workers here, he notes. FSS moved into a new, 22,000 square-foot building on Conroy Place in 2000, and the Manhattan store was closed in 2001. Two years ago, the business again relocated to 90 Mort Drive in Easton, Pa. Current conditions in New York have shown the wisdom of these moves, as tobacco products are now taxed at 75 percent.

Today, FSS has 130 people on staff in jobs that range from warehouse distribution to graphics design, videography, photography, marketing and programming. “We are a marketing company,” Zaretsky explains, “that just happens to be selling cigars.” They produce 24 catalogs a year, all in-house, that bring in much of the business. In 1997 FSS began selling over the Internet at its website www.famous-smoke.com. There, customers will find weekly deals, coupons, samplers, closeouts and even free items with certain orders.

“We have a very sophisticated system to measure and track customers’ orders, allowing us to target our offerings,” Zaretsky says. Indeed, they have data on customers back to 1994. “We have people who have spent as much as $100,000 on cigars over the years.” These include businesspeople that use them as gifts.

Two years ago, FSS added Leaf Restaurant Cigar Bar and Lounge to its holdings as well as the Humidor at Leaf where customers can choose cigars from thousands of offerings. These ventures are wholly-owned subsidiaries of FSS. Leaf offers cigar smokers a unique destination where they can feel free to indulge in an after-dinner smoke in the restaurant. The lounge area and the bar invite customers to relax. A state-of-the-art ventilation system assures customer’s comfort. In September, Leaf introduced a menu created by new executive chef Mark Teseny that offers pub fare such as sandwiches, burgers and salads along with steak, pasta and seafood entrees. The more casual décor and menu were unveiled during a party that highlighted the new CAO Flathead cigar.

As far as the product itself, smoking a cigar is a totally different experience than smoking cigarettes, Zaretsky explains. “You don’t inhale a cigar. It’s almost like you sip it. It’s a sensual, oral and olfactory experience that lets you relax and forget your cares.” It’s also an affordable luxury that offers two to three hours of enjoyment and appeals to people from all walks of life. FSS sells primarily handmade cigars from such countries as the Dominican Republic, Honduras, Nicaragua, Mexico and the Philippines.

It takes from three to four years to produce cigars from seed to leaf to finished product. “It’s a touchy-feely process,” Zaretsky explains. The tobacco has to ferment and age before it’s rolled into cigars. Different strains and ways of processing produce a wide variety of nuances, strengths and tastes that he likens to those of different styles and brands of beer.

As far as the cigar business in an increasingly non-smoking world goes, the industry is small in the U.S. – $300 million versus $8 billion for cigarettes. And, northeastern Pennsylvania has become the center for companies like FSS. “Pennsylvania and Florida are the only states that don’t have an added tax on cigars,” Zaretsky says. “Our biggest challenge for the future is the federal government, which has not yet regulated cigars or pipe tobacco.” When they do, he has no idea what impact FDA oversight will have.

As for Zaretsky, he has made the transition from a roller-blading New Yorker who never drove a car until 2000 to suburban homeowner and new dad enjoying a more laid-back Lehigh Valley lifestyle… all while honoring the legacy of the small shop his parents opened back in 1939.