Thinking of starting a vape shop?
Like most businesses, embarking on the adventure of opening a vape store is no easy task. But there are a few key aspects — that if addressed early — will set your business up for success in the future. Intrigued? Here are 4 key things needed to reach vaping victory.
1. Prepare a Business Plan
Vaping and e-cigarettes is an enthusiast driven hobby. There’s a vast vape community that obsessively covers the details of everything from the latest mods to new types of liquid and even pending FDA legislation. This bleeds over to the business side of things, inspiring many would-be entrepreneurs to open up a vape shop based solely on their love of the hobby. After all, what could be better than turning your favorite pastime into something you get paid to do day in and day out?
The issue is that passion doesn’t lend itself to the kind of measured and calculated thinking needed to run a successful business. As a result, many vape shops meet an untimely end. This could all be prevented if more of these entrepreneurs took the time to put together even a basic business plan.
Don’t worry, writing a business plan doesn’t require an MBA, and many of the standardized business plan templates you can find with a quick Google search will serve your purposes. But there is one major area where vape shops differ from a traditional retail business: licenses and legal requirements.
In general, laws around the sale and use of tobacco also apply to vape and e-cigarettes. However, each state, and even some localities within a state, have their own regulations. It’s important to check with your local authorities to understand the laws you’ll need to comply with and licenses you’ll need to acquire. Accounting for this in your business plan can save you time and prevent major or legal trouble down the line.
You’ll also want to have a firm grasp on the start-up cost associated with opening a vape shop, including how you’ll acquire financing should you need it.
2. A High-Trafficked Area
This one probably isn’t a surprise. Like most retail businesses starting out, you want to choose a location for your vape shop with plenty of foot traffic, parking, and an inviting storefront. The more foot traffic that passes your vape shop on any given day, the better.
Where vaping differs from other retail businesses is the size and growth of the industry. Vaping is a hot trend, with the vape industry projected to grow from $8 billion in 2015 to $47 billion in 2025. Everyone is looking to get in on the action, and that makes the location that much more important.
At this point, there’s a high likelihood that you won’t be the only vape shop in your community and the one with the best location will win. As vaping has become more mainstream, it’s also made its way into gas stations and convenience stores, so you’ll be competing with them too. Taking the time to perform a competitive analysis, as well as studying the available commercial real estate to identify the optimal location could be the key to your success or failure.
3. A Reliable Supplier and a Quality Product
You’re starting a vape shop, so it’s safe to assume that you have a passion for vaping and a few favorite products and brands of your own. The good news is that you know how to choose a reliable supplier and a quality product. So buckle down and do your homework. It’s crucial for you to find a reputable wholesaler that carries the products you trust. The last thing you want or need is for your supplier to either run out of the items you sell or for them to be unreliable. So do some research online and ask around at your favorite vapor shops.
Though deciding what products you’ll actually be carrying is the fun part, make sure that you’re not just choosing products that you’d want to use. It’s best to sell a few quality brands and items that are appropriate for both beginner vapers and those that have been vaping for a while. Though you serve a niche community, you want to make sure that you appeal to the largest number of people possible. Do a little market research and ask around. What are vapers looking for? What do they feel vape shops are currently missing and what would they be excited to see at a new shop?
For beginners, you’ll want to sell at least one variety of rechargeable e-cigarette or an e-cigarette starter kit. For more experience vapers, you will want to offer several vape kits that allow for customization. Lastly, be sure to stock a variety of vape supplies like batteries, mods, and perhaps most importantly, many varieties of vape liquid or juice.
4. Share Your Knowledge and Offer Great Customer Service
The importance of knowing your customer is a truism that applies to the vape and e-cigarette industry. As a vapor store owner, it’s important to recognize that some of your customers will be entirely new for vaping, others will be experts, and many will fall somewhere in-between. Based on that, your approach must be twofold: 1) you’ll need to provide advice and product recommendations that meet your customers’ individual needs and 2) you’ll need to deliver excellent customer service consistently.
That means being able to help new vapers pick out the starter kit they need just as well as you can talk through the intricacies of a new vape pen or vape mod with an experienced user. Like a sommelier, you’ll also need to be able to speak to the nuances of the thousands of flavor and nicotine strength combinations of vape juice.
As far as customer service and customer relationship management, you’ll want to develop policies that make sense for your business, but here are a few general questions you’ll want to answer:
- How will employees greet and interact with shoppers in-store?
- How will you handle returns or exchanges?
- How will you handle disputes and irate shoppers?
- Will you order products that you don’t carry in-store for customers?
- What programs will you put in place to develop customer satisfaction and loyalty?
Once you feel like you’re able to address these questions satisfactorily, make sure to put your policies in writing and train your staff on them. While a lot of customer service may seem like common sense, people will surprise you in the heat of the moment. The best thing you can do to combat this is to regularly revisit customer service policies with your team and practice roleplaying as needed.
5. A Smoking Social Media Presence
Social media is critical for any retail business; it helps drive traffic to your store and is integral in building a strong and personable brand. But since search engines such as Google and Bing don’t allow vape stores to bid on pay-per-click keywords, this makes a strong social media strategy crucial to starting and running an efficient business. It also goes hand-in-hand with the community of vapers you’ll be cultivating. Ideally, you want your social channels to attract new customers and keep returning customers up-to-date on promotions and events at your store. If you’re new to social media or this task seems daunting, check out our post on how to make your small business social media more effective.
6. Create a Welcoming Atmosphere
The atmosphere of your store is a significant way to differentiate yourself and get a leg up on the competition, especially if you can’t compete on price as the case of an online vape shop can. To that end, if you consider your vape store more of a vape lounge you’ll be on the right track.
This means cultivating an environment that encourages customers to hang out and vape instead of leaving immediately with their purchases. To help you achieve that goal, consider adding the following elements to your shop to create a comfortable, inviting vapor lounge:
- Comfy couches and chairs
- Tables with a variety of reading material
- Drinks and light snacks
- Televisions and/or music
- Plenty of lighting
- An outside seating area (if your space allows it)
Another way to build a warm and inviting atmosphere is through events. For example, you could host a tasting for a new brand of vape juice or a launch event for a new e-cigarette company or vape company. Taking a step back from vaping culture, consider showing games during the football (or another sport) season. This gives your customers the opportunity to relax, vape, and chat with like-minded individuals. Lastly, since many people switching to vaping as an alternative to traditional cigarettes and other tobacco products, you could go so far as to host a tobacco cessation support group.
The biggest takeaway is that when customers have several competing vape shops to choose from, they’ll naturally drift towards the one with the most inviting atmosphere. While you can do a lot with the physical space of your location, the attitude of you and your employees can be even more impactful.
7. iPad-Based POS System
Purchasing an iPad-based POS is one of the most important moves you can make when starting any business. A vape shop is no exception. A good POS system will not only provide a customer-friendly experience at the point of sale, but also will allow you to capture customer information, optimize staffing and manage your inventory more efficiently. Starting a business is time-consuming, but using a POS system helps you save time so that you can focus on the aspects of your business that matter most.
Starting your own business can definitely feel overwhelming at times. But with the recent surge in the popularity of vaping, starting a vape shop can be a lucrative endeavor. Do your research, stay focused and the success of your business will come.
If you’re about to open a vape show, or already running one, and looking for a point of sale system, consider ShopKeep. Our software has features that can help vape shops like yours.