A Sobering Look At Starting a Vape Shop in 2021

Sep 15, 2021

The vaping industry has exploded in such a way that many cannot resist getting in and have their share of this lucrative pie. It is estimated that by 2025, the industry is set to be worth $61.4 billion. 

Euromonitor, a market research group, has reported that an estimated 55 million adults will be vaping by 2021. 

Perhaps all these impressive stats have piqued your curiosity and are now considering opening up a vape shop this year. But have you considered that it may not be as easy as you think?

Let’s look at some of the stark realities of launching a vape shop in 2021. 

Regulatory Obstacles

The myriad of regulations for opening up a vape shop can be intimidating. In the United States, it is especially challenging due to the constantly evolving regulations and even bans within some states. 

If you have a brick-and-mortar shop, expect to pay exorbitant excise taxes on vaping products, depending on the state and municipality you live in. 

If your vape shop happens to mix loose tobacco, make or modify vaporizers, or mix e-liquids, you will need to stay in compliance with the FDA’s tobacco retailer and manufacturer regulations. 

Additional licenses and permits will be required to legally open and operate a vape shop. This will also depend on your state, county, and city. Lawyers may need to be consulted to verify the requirements for opening up a vape shop in your area. 

Pandemic’s Impact On Brick and Mortar Stores

After last year’s outbreak of the pandemic, the spread of infection resulted in widespread closures or strict operating restrictions of many retail establishments nationwide. 

Now, even after many stores have reopened and the availability of a vaccine, consumers are still hesitant about making a trip to the store and avoiding person-to-person contact as much as possible. 

As seen early on in the beginning of the outbreak, most consumers have preferred to mostly shop online for all their needs. Online vaping shops have certainly met this need. 

As a result, opening up a brick-and-mortar vaping shop in this current climate might not be the best move. 

US Online Vape Shops Face Regulatory Roadblocks

Although launching an online vaping shop may seem like taking the path of least resistance, it is not. 

As mentioned previously, the United States has one of the most stringent regulatory laws when it comes to vape shops. 

To get started, you would have to confront the following legal matters:

  • According to the FDA, e-cigarettes, e-liquids, and ENDS cannot be sold to customers under the age of 21. Therefore, your website would need to be equipped with an age verification solution in order to make sure you are only selling to adults. 
  • Since many states and cities have a ban on the majority of e-liquid flavors or the sale of all vaping products online, your website must show the appropriate products to customers in the areas with flavor bans. Where there is a ban of all vape products online, your website must automatically decline sales to those customers. 
  • If you ship vaping products across state lines, you will need to comply with the PACT Act. This requires you to register and keep sales records for state tobacco taxation authorities. 

Profitable But Not Easy

Without question, launching and operating a vape shop has the potential for a truly bankable venture. However, one would be remiss to not take careful consideration of all the roadblocks that this path can bring. 

If you take the time to conduct considerable research, craft a well-thought-out business plan, and seek the advice of experts, you will be armed with the tools needed to navigate the unpredictable waters of the vaping industry.

Let us help you get a high risk merchant account today!

Get Started

Award winning.

  • 2012
  • 2013
  • 2014
  • 2015
  • 2016

Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

Live Chat