Opening a Vape Shop?

Do you think about starting a vape shop? Considering the demand, it sounds like a great idea. But bear something in mind, you will have to deal with a business, and opening a vape store is not an easy task.

When Oxford Dictionaries coins “vape” word of the year, you know the industry is blowing up mainstream culture—and maybe you’re wondering you should start a business to get in on the action. Though it’s recently become controversial, the numbers suggest that this isn’t a fad that’s going away anytime soon—by 2025, the vaping industry is projected to be worth $61.4 billion. It’d make sense for entrepreneurs, both new and established, to want a piece of this lucrative industry and be curious about how to open a vape shop.

Write a Proper Business Plan

Every idea begins with a well-prepared plan. And to start a vape shop business, you will need one. In simple terms, a business plan is a formal document where you write details about your business. These include the purpose of your business, its goals and actions to achieve them, the time frame for reaching these goals, and the budget.

To write a business plan for your vape shop, you can download a simple draft from Google and follow through. Then, write some information about your vape shop’s brand, like products, services, management, customers, and marketing plan. But one of the most important parts is to detail the budgeting, logistics, and operations.

Learn about the local regulations

If you want to build a successful vape store, you will have to follow the rules. Though each state has its own rules, most of these regulations fall under tobacco use and sale. So, get well-informed about the legal requirements and what kind of licenses you need to open a smoke and vape shop in your country.

Check your budget

Every business needs money you have to invest. And you need to be aware of how much money you’ll need to start a vape shop. When opening a vape shop, check all the possible costs you will have. For you to make the budget, take into account the following essential costs:

• renting a space;
• expenses for getting the required licenses;
• vape products;
• special equipment and resources, like a POS system, shelving units, and others;
• insurance plan.

Account for essential startup costs

No matter what industry they’re in, every soon-to-be small business owner needs to take a few steps before launching their brick-and-mortar locations. Opening a business bank account, scouting and securing a location, agreeing on a supplier, purchasing a point of sale and accounting software, launching a marketing campaign, and hiring and training staff are just a few of those vital first steps. You’ll need to account for your startup costs throughout the whole process.

Don’t underestimate the costs of stocking your inventory, too, when learning how to open a vape shop. To start out with, it’s suggested that you stock your vape shop with at least the following products:

• Hardware
• Replacement coils
• E-liquids
• Vape batteries
• Battery chargers
• Vape juice

It’s a good idea to purchase your inventory through a wholesale supplier, so you can essentially buy double the stock at half the price. Just do your research to make sure you’re not sacrificing quality for quantity.

So, how much does it cost to open a vape store? In a 2013 report, Jon Merton, founder of Vapor Craze in Long Beach, CA estimates that running a vape shop costs anywhere between $7,420 to $10,020 minimum monthly, but that’s not including product. The report also recommends having $50,000 to start a vape shop, and that you have enough to cover six months’ worth of expenses.

Understand the regulations

The industry of vaping is regulated for quality and safety, and thus, compliance is very important. It is another area where the accredited wholesalers might just assist you – giving out compliant blends for best vape brands which are in line with all the required regulations.

With support from a recommended vape wholesaler with a track record as well as a comprehensive vaping business support range – from partnerships with suppliers to formulation development that is unique and from the delivery of OEM white label product up to the co-packing, you will get help from e-liquid wholesaler will help you to build a business in vaping that will succeed.

Get business insurance

When thinking about how to start a vape shop you definitely need to think about what kind of business insurance policy you’ll need—and factor high insurance fees into your startup budget.

According to internal data, Insureon says that vape shops pay much more for insurance than other retail shops. Where the average annual cost for small business owners holding the company’s general liability insurance policy was $591.13, vape shops’ coverage for the same policy cost an average of $711.11 annually. But the exact cost of your insurance policy will depend on risk factors like your projected revenue, the value of your property and equipment, and the value, type, and amount of products you stock.

Although you can purchase your insurance through general insurance companies, know that there are also niche insurance brokers with policies geared specifically toward covering vape shop property and products. E-juices, health hazard and defective products, your brick-and-mortar location—there’s an insurance policy for all of the above.

Get a business credit card, business checking account

You’ll want to be sure to keep your business finances separate from your personal finances, especially in a business where the product you’re selling is fairly regulated. A business checking account is a good way to do this, and should be a top priority when you’re starting a vape shop. You’ll need a place to keep the money that’s coming into the business and you’ll want a bank account to be able to pay employees and bills from as well.

Having a business credit card can be another important step for you, since it will serve as a means to an end when it comes to getting funding. It’s also great for building your business credit score. You’ll want to help boost that credit score as much as you can in the beginning and your business credit card can help you do that. Pay it off on time, if not early, and reach out to suppliers who you’re paying on time to see if they can vouch for you to the three credit bureaus to help boost your score, it could pay off later down the line.

Although card issuers do ask for your industry and amount of time in business on your application, it’s highly unlikely that they’ll turn you down on the basis of either stats. Really, card issuers mostly care about your personal creditworthiness and your ability to pay back the credit you use.

So, expect the card issuer to make a hard credit inquiry when you apply for your card, and that they’ll ask about your business’s financials. Don’t worry if your vape shop doesn’t yet have an annual revenue; as the primary cardholder, you’ll provide your personal income and outstanding debt, too.

Of course, credit cards can become expensive if you carry a balance month to month. But assuming you pay your bills in-full every month (which is simply a best practice of card ownership, anyway)—and you choose a no-fee business credit card—plastic might be your most affordable option to cover some of your initial expenses while you’re figuring out how to open a vape shop. It’ll certainly be one of your most accessible right now.

Get funding

Aside from preparing for high up-front costs, vape shop owners should also know that it’s hard to secure financing in this business. Despite its high profitability, banks put your industry in the riskiest category, so you’ll have a hard time gaining approval from the biggest financial institutions in your area.

Even beyond the industry-risk factor, banks generally won’t fund startups, period. Brand-new ventures don’t have the credentials—like time in business, strong revenue, and profitability—to prove to these institutions that they can repay what they owe.

Although certain online lenders are open to funding vape shops, even they often won’t issue loans to startups, either. Instead, the newest vape shops might want to look for alternative sources of funding to get their ventures off the ground. Crowdsourcing, bootstrapping, friends and family loans, and personal loans for business are all popular, and attainable, funding options for brand-new businesses.

If you’re determined to secure a true business loan—and separate your personal and business finances and build business credit from the get-go—you can start using a business credit card, which we discussed above, to pay for business expenses. But, you’ll have to be careful to pay back your card regularly and in-full to build the kind of credit that will convince lenders you’ll be a good investment.

Down the line, once you’ve built up your credit score and business’s finances, you can turn to a vape shop-friendly alternative lender for a bigger business loan.

Rent a location

A business needs visibility not just on Google but in real life also. Keep in mind that a vape store is a retail business. So look for a good place, not too small, nor too big. Ideally, you want a crowded place with high traffic, a parking lot, and visibility.

If you can’t find a street-level space, check for some popular options like shopping malls, retail shops, or gas stations. Another idea is to set up an online vape store. But one thing is for sure. Opening a vape shop business is quite profitable as it’s a constantly growing trend. When looking for a space, learn about the competition, rent price, and the potential of the location. In other words, trust the numbers

Make sure you offer the best products

In other words, find a trustworthy and reliable supplier for your vape shop. People will appreciate you by what you offer them. So you need only the best.

But how to find suppliers that will deliver you top-quality inventory? Start by asking people in the niche or make a Google search and check the reviews. When you find one, speak with them about all the details and analyze the offer.

Just one thing. Make sure you offer a variety of high-quality vape juice, kits, and supplies.

Get the right people to work with

Let’s not forget that people run businesses. So whom to look for when opening a vape shop? Hire people that know about the vape industry and will help your customers with the right information and recommendations.

But that’s not enough. Your future employees will represent the face of your brand. So look for employees with good soft skills that are respectful, positive, and client-oriented.

Do Your Homework

Before partnering with a wholesale e-cigarette/vape supplier it’s very important to do your homework and choose to partner with brands that not only have great products but are also committed to assisting you to achieve your business goals.

Amongst other things look for a vaporizer manufacturer/supplier that has the following:

A strong history in the vaping sector including quality assured manufacturing and with a wide selection of branded vaping products.

Offers great sales and service, including dedicated account management, logistics, and international distribution support, especially with regards to customs requirements. The best choice here is to look for a vape brand that has wholesale distribution outlets within your country or region.

A dedicated marketing and promotions team with a strong online brand presence who also offers a great point of sale and online marketing resource support to their retail partners. This will save you thousands in time, money and human resources.

Start off Small

Once you’ve completed your research it’s important to test the waters before diving in and placing a big order.

Sure, there are some cost-saving advantages to placing larger purchase orders but it is advised to start off small to test your customers’ approval rating of the brand. Always look for a manufacturer brand that has a low minimum purchase order volume, a sliding wholesale pricing system based on volume and a client loyalty program that opens up even greater long term partnership purchase order savings.

It is recommended to request a product sample or placing a small order first. This allows you to check both the brand’s supply chain efficiency with regards to delivery times and product quality once your vape kit arrives.

A further consideration before ordering is to check the brand’s new product release schedule. The last thing you want to do is place an order only to discover that a few weeks after arrival the kit has been superseded by a new or updated model as this will make it more difficult to move your stock.

The bottom line holding too much stock and/or superseded stock can dramatically affect your vape business cash flow.

Find the Best Vape Wholesale Supplier

Actually, “reliable wholesale supplier” is always a top search in the circle of vape store owners, no matter which country you’re in—and no matter you run business online or offline. When you find a good wholesaling partner to work with, you’ve just about got the key to success.

Benefits of purchasing wholesale e-juice

When you buy the vape juice direct from the wholesale vaping supply, you will enjoy the following benefits:

Saving of money

What it means, in short, is that to buy an e-liquid from the wholesale vaporizer juice suppliers denotes that, you are going to have access to high-quality products at a price that is quite affordable. When you take the distributors, middlemen, out of the process, you save money as you will not have to pay any of the fees which they charge.

As the owner of the vape shops, you need to be aware that there are a variety of overhead costs with the business. That is the reason why it is important finding somewhere to save on costs when it is possible, and mostly when doing the purchasing of the products that you want to store.

You will have to pay for the labor and e-juice expenses of the vape company, and not the products shipping from a single warehouse to the next. At the same time, when you avoid the distributors, you will only have to pay the designated wholesale price on the products, instead of the higher rates which they might offer.

Why the distributor prices normally get high at times, is because they need to make money, so they purchase the products at the wholesale and then go ahead selling them at a particular price so that they get paid. When you buy cheap e-juice, it denotes that you will get a price that is quite low as compared to having to buy per unit since when it is ordered in bulk, it becomes quite cost-effective.

Sizes of the bottles

The suppliers of e-liquids might as well offer you a choice of various bottle sizes. It is possible for your customers not to be too sure of the flavor that they like and which one they don’t like and will require getting a smaller bottle for purposes of trying out first before purchasing the one at a higher price, which could be more cost-effective. To have a wide range of sizes is known to allow your customers in making various choices, warranting a repeat sale.

The trade data

When you work directly with the vape company, you tend to have access to the various methods of e-liquid formulation. Details like the flavors, ingredients, supplying, and packaging are some of the things that you will access. With such information, you can compare easily with a variety of wholesale vapor supply so that you get the best deal for the products with high quality.

Access to relationships and deals

To shop for wholesale vape juice is what gives you the opportunity of creating a valuable and long relationship with a particular vape company. To build relationships with manufacturers denotes that they will be able to think of you when they have deals as well as new products before anyone else does.

Vape wholesalers tend to have various connections in the industry. What it means is that you can be able to meet other experts in the industry and learn from what others are currently doing to ensure that they succeed in their business. When you initially start, such relationships might not seem to be quite important, but when the time comes, and there is a need of relying on the wholesaler, you will want to know they are somewhere in case you need their support.

Extra money

When having a direct relationship with a particular wholesale vaping supply, you get the products cheaply as compared to using a distributor. When you cut the third party, it denotes that you can easily sell the products in the shop for a similar price that you usually would, but get them at cheaper prices from the wholesalers.

Always in supply

You don’t want to deal with not having the required products, especially when having a few regulars and knowing the type of e-liquids which they purchase. With the popularity of the world of vaping growing daily, you expect that more customers will come to you to look for vape juice. But, keeping a steady supply might be a problem if you work with distributors.

When you buy your vape products direct from the wholesale vaping supplies, it denotes that you will not run out of supply. And if that happens, you can always get the products to be shipped to you the following day so that your customers will know that, you care about their preferences and make them readily available whenever they need them.

To run out of stock can be quite detrimental to the business. A customer that comes in for a certain flavors or vape brands might end up leaving without buying and finding an alternative vape shop to embrace. You don’t want to lose a customer in such a manner. Instead, ensure that you work with a wholesaler that can ship products to you whenever you need them.

Purchasing vape juice in wholesale

Finding the right wholesaler is not always a straightforward process. It might take you weeks sampling the various e-liquid flavors which are available from various companies. To start your search, you should check out the forums online and ask out for recommendations.

From that, you can come up with a listing of the wholesalers that you prefer working with and send an inquiry directly to them. It is recommended that you ensure that check their websites to get to find out other information that you might find valuable.

Ensure to shop your e-juice from the specialists. You want to get to use wholesalers who do sell vapes together with the vape juice so that you can know that they will be a one-stop-shop and will provide you with all that you need. Alternatively, you might find wholesalers who offer vape juice only and it could be the best one for you because you feel they are the ones who are dedicated to their craft, developing e-liquids of high quality.

Spread the word about you

Online marketing is a must nowadays. If you are not on social media or don’t have a website, consider your vape shop doesn’t exist for your customers. So, hire someone to develop a friendly-looking and functional website, set up your Google business profile, and create pages on the most popular and relevant social media platforms.

The bottom line

If you’re determined in starting a vape shop, we definitely encourage you to go ahead and do it, but know that you’ll encounter challenges at many turns—prohibitive excise taxes, strict FDA regulations, competition from online sellers and traditional nicotine vendors, and trouble securing funding can all put your vaping startup at risk.

But armed with a ton of research, a well-crafted business plan, and the advice of experts, we’re sure you can navigate these roadblocks. If you can keep your doors open as the FDA rolls out more e-cigarette regulations in 2022, you and your local vaping community will be happy to own a slice of this $5.5 billion industry.