FOTB: Smoke shop angles for return customers
ALEXANDER — New Yorker Phil Hamda came to North Dakota to scout for real estate opportunities, but his plans changed after paying nearly $8 for a pack of cigarettes in Williston.
Hamda, whose father owned tobacco shops in New York City, noticed that tobacco prices in the Bakken varied widely.
“In New York, if you don’t like the prices, there’s a store right next door,” Hamda said.
Instead of trying to develop housing, Hamda took lessons he learned from his father and opened the Tobacco Depot in Alexander in February. He says his niche is fair, consistent prices that earn him repeat customers.
“Everybody’s nuts about our prices,” Hamda said. “We’re not extortionists.”
He initially struggled to find retail space and planned to operate from a trailer in Watford City. But when that location didn’t work out, he discovered a space for rent along the heavily traveled U.S. Highway 85 in Alexander, between Williston and Watford City.
“You couldn’t ask for better visibility than this,” Hamda said as a steady stream of oilfield traffic goes by his shop.
The North Dakota Department of Transportation is constructing a bypass that will take Highway 85 traffic around Alexander. Hamda said he expects the bypass will actually help his business because the traffic is often so heavy that customers can’t get into his parking lot.
“A lot of guys say they’ve been trying to get in here for a week,” Hamda said.
Hamda said he wasn’t prepared for the demand for electronic cigarettes and personal vaporizers. They account for about half of his business, primarily because smoking isn’t allowed on many oilfield locations and housing camps where workers live, Hamda said. He also sells a lot of chewing tobacco and cigarettes by the carton.
Hamda, who spent 20 years self-employed as a contractor, was in the middle of developing two six-unit condominium buildings in Jersey City, N.J., when the recession hit. He still wants to finish the buildings, and his success in North Dakota will help him do that.
He plans to sell the buildings once they’re complete and make North Dakota his home.
“After I’m done with them, I’m bringing that money here,” said Hamda, who has plans to expand his tobacco business. “There’s plenty of opportunity out here and I think it’s safe to invest.”