When business-minded individuals make the switch from smoking to vaping, they often begin to wonder if starting a vape shop would be a good investment. If the idea of owning a vape shop has been kicking around in your mind for a while, know that you definitely aren’t alone. You’ve seen the positive changes that vaping has made in your life, and you’ve correctly surmised that selling vapes can potentially be quite profitable.
Before you jump the gun, though, you need to understand that there are some significant investments required if you want to start a vape shop – and getting started can be quite expensive.
Is running a vape shop right for you? These are the investments that you’ll need to make before you can launch your store.
Storefront or Warehouse Space
Before you can run any type of vape shop, you’ll need to lease or buy a storefront or warehouse. Even if you’re not planning to run a brick-and-mortar store, you’ll still need a space for storing your inventory – so there’s no way to avoid this investment.
You’ll probably want to scout potential locations and prices before you get too far into the process of launching your vape shop. A better location can potentially mean that you’ll enjoy more customer traffic if you’re running a brick-and-mortar store or better access to shipping solutions if you’re running an online store. A higher monthly rent, however, can potentially affect your profitability.
Inventory
If you want to start a vape shop, your inventory will probably be your single biggest investment. There’s often a very large difference between the wholesale and resale prices for vape gear – which is a good thing – but inventory will still be a major purchase for you. That’s because there’s a huge variety of products available, and everyone wants something different.
These are the main types of vaping products that you’ll need to consider carrying.
- Disposable Vapes: These are the most popular types of vapes that are available today. They’re available from several brands. Each brand makes several models, and every model is available in many flavors. You’ll want to carry the biggest variety possible.
- Refillable Vapes: The most common refillable vapes are large vape mods and small pod systems, and you’ll want to carry more than one of each type. Every refillable vape requires replacement parts such as pods and coils; you’ll need to offer those as well.
- Bottled E-Liquids: A refillable vape requires bottled e-liquid. This is another area where there’s an enormous level of variety because every major brand has many flavors that are all available in several nicotine strengths. You’ll lose a sale if you don’t have exactly what a customer wants.
If you want to run a successful vape shop, you can’t just carry one e-liquid brand. You need to have several brands in all of their available flavors and nicotine strengths – and that’s just one product category. That’s why inventory is such a major investment for any vape shop.
Domain Name and Website
Your vape shop will need to have an online presence. It’s important to get started on this well before your store launches because your domain name should almost always match the name of your business – so you shouldn’t settle on a name until you’re sure the domain is available.
Having a website is imperative even if you don’t plan to sell vapes online. According to recent surveys, about 80 percent of consumers go online to search for local businesses at least once a week. You can’t afford to lose out on that potential business.
If you don’t know how to put a website together, you’ll need to plan to have someone do it for you. If you only need a simple site to advertise your local vape shop, you can probably find a student who will do the work affordably. You could also try hiring a freelancer online. Setting up an e-commerce site, on the other hand, will likely cost thousands of dollars depending on the complexity.
Staff
If you’re planning to open a brick-and-mortar vape shop, you’ll probably need to hire at least one staff member. Vape shop employees typically earn around $10-15 per hour depending on the location, so you’ll need to budget for that along with benefits and other expenses. It’s not always easy to find experienced vapers who are also good cashiers and effective salespeople, so you should start your search early.
It’s possible to run an online vape shop as a solo operation on a temporary basis, but you’ll need to hire help when order volumes begin to increase. Someone has to sort through incoming products, put them in the right places, update your inventory tracking software and fulfill orders. It won’t be long before it’ll become impossible for you to do all of those things yourself.
Insurance
Buying the inventory for a vape shop is a huge investment, and you’ll want to carry some sort of insurance to protect that investment. You may even be required to carry insurance if you use your inventory as collateral when taking out a business loan. It might also be necessary for you to carry liability insurance. Vaping products have some inherent risk since they contain lithium-ion batteries, so you should expect your insurance premiums to be a bit higher than they would be for businesses in other industries.
Marketing Services
With any type of business, marketing is a requirement that you can’t avoid. Unless you’re opening a brick-and-mortar vape shop in a prime location that receives plenty of foot traffic, you’ll have to find a way to get the word out.
If you’re planning to open an online vape shop, marketing will be an even bigger challenge due to the intense competition. You’ll need to optimize your website to perform well on Google, or potential customers won’t be able to find you.
It’s possible that you’re already a skilled promoter and plan to handle the marketing yourself. If you’re not, though – or you just want to focus on other aspects of running your business – you should plan to get help. Your vape shop can’t succeed if no one knows about it.