Opening an e-cigarette or vape store can be a lucrative endeavor. This seven part series will cover all the aspects of starting your business. So stay tuned in the upcoming weeks for our upcoming blog posts on permits and licensing, choosing a location, hiring strategies and more. We’ll be starting with a strong base; researching and mapping out your business plan.

Creating a business plan will help you to organize the direction of your store. Additionally, a business plan is usually necessary when you apply for a business license and especially important in attracting investors to your business.

What do I need to include in my business plan? 
We’ll go over these important factors that you’ll want to include in your business plan:

Market Analysis
Key points
Products
Tools for Growth
Location
Competition
Strengths and Weaknesses
Loan Summary Statement
Breakdown of Costs
Balance Sheet
Financial Plan
Management

Market Analysis
Market analysis involves doing some research within your market and in your area. How much potential success could your vape shop achieve? Is there a viable market for what you’re trying to open?

*First, do your market research by utilizing primary (your own) and secondary (already conducted) research. You can gather primary research through surveys or personal observation.

*Next, determine your target market. Figure out what your target demographic looks like. How old are they? What do they do for a living? Is your customer base mostly men, women, or both? Would your service be especially appealing to a particular ethnic, or economic group? Will only wealthy people be able to afford your service? What type of neighborhood are e-cig shops most successful?Establishing your prime market will help you to establish the clear characteristics of people you want to market your service to.

*Take your target market and figure out the size of your potential market. How many people in your community fit into your target demographic? How big are your potential competitors?

Key Points
*Concept: This is where you define your e-cig shop strategy. What type of goods and services will you offer? Are you looking for more of a lounge or retail shop? Will you serve food or beverage? What do you want your e-cigarette shop to provide? Use this to start forming your company’s mission statement.

*Direction: Direction setting tells you and helps you focus on where you are headed as a company. Use this section to outline where you are going as a company and how you seek to achieve it. Let potential investors know that your business will be a meaningful addition to the marketplace.

*Market Approach: Think of all the positive benefits your company will provide. This will help you choose a strategy. Evaluate where you have a competitive advantage over competition and use this to reach your goal. How will you establish that your e-cig shop would be better, cheaper, more fun, offer more variety or more convenient than competitors. Make sure you’re fulfilling some sort of need.

Products and Services
List your products and services that you will offer. Include sample menus of e-liquidsvape models, cases, or classes you may offer.

Tools for Growth
Consider how your e-cigarette store can expand in the future and specifically how you can achieve these goals:

Location
Detail the dimensions and approximately where you plan to lease. Also, detail what type of space you require. i.e outdoor space, parking, visibility, renovations etc.

Competition
List the competing businesses in the area and proximity to your prospective location

Strengths and Weaknesses
Detail what competitive advantage you may have over other competitorsin the area and how your business would fill in the gaps that competitionleaves open.

Loan Summary Statement
List all of the details of your business loan including how much you are borrowing, which bank is providing the loan, the interest rate, and how you plan to allocated loan funds.

Breakdown of Costs
Include an organized chart detailing your cost breakdown.

Balance Sheet
Include a projected breakdown of the costs and finance allocation for the first 6 months of operation.

Financial Plan
Target your funding sources. Evaluate your appeal according to the R.M.A (Risk Management Association) database that banks and other funding sources use. Lenders will typically look to the company’s Capital, Capacity, Collateral, Conditions, and Character or what is known as the 5C’s of lending when underwriting a loan. You’ll need to have covered all these bases well before seeking funding. Detail your financial figures accurately and clearly.

Management
Present yourself, investors and other partners you already have included in this endeavor in the best light possible. Include resumes and relevant experience.

Remember to stay tuned for the upcoming blog posts in this series covering all the elements in “How to Open a Vape Shop” including:
*applying for a business license
*product sourcing
*marketing

Sources: wikihow.com/
bizplancompany.com/
vapesquad.com/

Written by Sierra Adkins

vape stealthtouch

 

How to Open a E-Cigarette or Vape Store: Business Plan and Research

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