This title may surprise you, but since founding VapeMentors I have been many conversations and encouraged some people to not open a brick & mortar location. Sounds strange since we’re consultants, but nothing would be more painful to us than to see someone open a location, put in their blood, sweat and tears (and money), and have it go down in flames. Our real priority is supporting Entrepreneurship and that focus happens to be in the vape space.
Why would you not open a shop?
Reason #1: Not enough money.
Pretty simple, right?? But you’d be amazed at how many people we have spoken with that have just a few thousand dollars and want to open a shop. Their motivation and heart is in the right place, but many times common sense (not always common) is missing. This question has been addressed in more detail in our Special Report called “How to open a Vape Shop when you have no $$” but here’s our rough rule of thumb.
Unless you have a minimum or $20,000, and that is bare bones minimum, please do not attempt to do this on your own. Granted, there are places in this country where $20K takes you further than other places, but even in those cheaper places there some things you cannot discount, especially the cost of inventory and supplies. Having less expensive rent and opening costs are great, but you will pay within 10% in costs of materials no matter where you live.
A huge percentage of businesses not vape related fail due to “undercapitalization,” which in simple terms running out of money. Guaranteed everything you budget to spend will be off by at least 10% to many times that. Even double… You want to open a restaurant, show store, dress shop…you name it, our suggestion is to be sure you have budgeted more than you need and plan on 90 days operating capital n advance.
Reason #2: Not enough experience.
And that can take one of two directions.
You may be a great Technician, which means you can tear apart a mechanical and throw on a new wick in just a few minutes. You know your juices inside out and which ones hit and which ones do great rings and which ones suck. That is great knowledge to have to work IN a Vape Shop but necessarily to own and run one.
On the other side of the equation are those that have a history or background of owning businesses or other entrepreneurial ventures, but sometimes don’t have any knowledge of the vape market. They don’t know an Ego from a Kanger and possibly know even less about juices. Hell, they may not even Vape! You know, that’s all good and is not a reason to pass on a shop. The truth is, Technicians are easy to find and hire and teach those that don’t know.
If you have zero business background or entrepreneurial experience and maybe just a bit of Technical know-how, then you need guidance. If your passion and motivation are real, you can pull this off. I have said that the Vape market has been very forgiving, which means that even those that did it wrong or poorly many times made it work. That window is shrinking as more seasoned pros (with more money) enter this space.
Reason #3: You are in it just for the money…
There is money to be made in this business but you really should have passion for it in some areas. If you have true unbridled passion for wanting to be entrepreneurial and you believe in the product that is great. If you think you want to convert the whole friggin’ world because you were able to kick the tobacco habit and that’s your goal in life…it may not be enough.
Here’s the reality of the Vape Space the way we see it.
It is not going away in most of our lifetimes. Big Tobacco projects that the “VTM” industry, which stands for Vapors/ Tanks/ Mods in their words should exceed conventional tobacco sales in the next decade. That means that this small but growing $2.2B industry may get to the $35B mark by 2014. That is a 10-fold increase which is beyond huge. Our projections here at VapeMentorS show that we should have a 2x-3x increase in the next 18-36 months, which means as much as $7B by 2017. That may be low, but we’re rather err that direction.
The “e-vapor” market is on the radar of this same Big Tobacco industry and they will probably not go the route of opening retail stores, but they will get into the manufacturing industry along with the e-cig space, which they already dominate. Will we see authentic “Marlboro Red Vape Juice” in the near future? If I were a gambler I would put my money on it.
What are the top questions you wished you asked or what do you wish you knew then that you know now? Can you avoid learning “the hard way?”
Share your ideas via e-mail to norm@VapeMentors.com
Author: Norm Bour
Norm Bour is the founder of VapeMentors and the host of the award-winning podcast Vape Radio. He’s a vape industry coach, speaker, author and can be seen rubbing shoulders with the top influencers in the vape industry.