These days, with smoking banned in nearly every public place, there still are people who smoke, and they want to acquire the instruments for their chosen vice. Cigarette smokers can go just about anywhere to get theirs, but cigar and pipe smokers generally have to seek out the illusive smoke shop. In high-traffic areas, opening a smoke shop can be a successful business, and they are welcome finds for smokers.
Most states require licenses to sell tobacco products. This is much like setting up a business in that you have to file forms to explain what you intend to sell, where and how. In the United States, you can’t sell tobacco products to people younger than 18. Tobacco products are heavily taxed, so be aware of all the rules for collecting and turning over such taxes.
In the U.S., tobacco product sales are regulated, and a license or registration is required for retailers. Information on this can be found at your state's website. For example, New York's website will give you information about compliance, the laws and where to apply for a Certificate of Registration.
Select a Location
High-traffic areas are best but tend to cost more. Still, since fewer people are smoking, you need to attract the percentage who still are, and you have to attract enough of them to make a living. Take a drive and look for existing smoke shops for sale. Malls tend not to be as good as plazas or main streets. The once mighty Pipe Den, which had stores in many early malls, went out of business while its chief rivals, usually independent owners, survived.
Design Your Store
If you are catering to cigar connoisseurs, for example, you will attract more of them with a walk-in humidor. This is simply a room within your store that is sealed and has high humidity. The cigars, and pipe tobacco in some places, are kept at a constant humidity, keeping them fresh and preserving the flavor. Humidors are so good at this that some pre-embargo Cuban cigars — the kind that made Cuba famous for its cigars before President John F. Kennedy signed the embargo of all things Cuban from entering the United States in the early 1960s — are still fresh today.
Select Your Stock
Depending on where your store is, you'll need to be very selective about what you keep on hand. A middle-class area, for example, probably won’t be a good market for high-end, expensive tobacco products. Some specialty shops choose cigars, pipe tobacco and non-mainstream cigarettes, while others have a wide variety of all types. You generally won’t find White Owl cigars in the humidor, and a place that sells Arturo Fuente may not carry Backwoods Smokes. A smoke shop operator needs to tailor to his customers over time.
Open the Doors and Advertise
Smokers will seek you out because they want a place they can go where they are comfortable. Some cigar and pipe smoke shops have comfortable chairs and “dens” where smokers can sit back, enjoy a cigar or pipe and have conversations. Smoke shops are about the only stores left where people can smoke indoors, so giving them a comfortable atmosphere will build customer loyalty.
Smoke Shop and Vape Shop Franchise Opportunities
Before making the investment in your own smoke shop, take a look at franchise opportunities. While there is an upfront cost in buying a franchise, you will have access to inventory, a proven store design and the training and support you may need as you're just getting started. Franchises also have brand recognition that smokers often look for, since they already know what brands you sell and what your pricing will be like.
Franchise opportunities are also available for vape shops. Of course, vape shops have a different clientele and the two business models don't normally go together well. If you are exploring the idea of a vape shop, make sure they are legal in your community. If they are legal, keep an eye on the news to see if upcoming legislation is being proposed that may damper or snuff out your business.