Vape Shop Business Plan
You’ve come to the right place to create your Vape Shop business plan.
We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Vape Shops.
Below is a template to help you create each section of your Vape Shop business plan.
Executive Summary
Business Overview
Leroy’s Smoke Shop is a neighborhood vape shop located in Portland, Oregon, that sells assorted electronic cigarette products and accessories. The Company will provide a large selection of products including starter kits, vape pens, vape mods, vape pods, dry herb vapes, disposable vapes and flavored liquid. Our shop is located in a convenient spot downtown and will provide a friendly and customer focused environment.
Leroy’s Smoke Shop is led by Leroy Ford, who has been in the vaping industry for ten years. He has spent much of this time working in e-cigarette manufacturing as well as managing several vape shops, smoke shops, bars, and nightclubs in the local market. As such Leroy has an in-depth knowledge of the vape shop business including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).
Product Offering
Leroy’s Smoke Shop will sell an extensive inventory of electronic cigarette products and accessories. Some of these products include:
- Electronic cigarettes
- Electronic cigarette accessories
- Tank refills
- Vaping equipment
- E-liquids
Though most of the shop will be dedicated to vape products, we will also sell regular cigarettes and CBD products.
Customer Focus
Leroy’s Smoke Shop will primarily offer its products to the residents living in downtown Portland, Oregon. Portland is a growing city full of young adults who are interested in vape and similar products. The city also has a large population of middle and upper class individuals who have the disposable income to spend on these products.
Management Team
Leroy’s Smoke Shop is led by Leroy Ford, who has been in the vaping industry for ten years. He has spent much of this time working in e-cigarette manufacturing as well as managing several vape shops, smoke shops, bars, and nightclubs in the local market. As such Leroy has an in-depth knowledge of the vape shop business including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).
Success Factors
Leroy’s Smoke Shop will be able to achieve success by offering the following competitive advantages:
- Management: Leroy’s Smoke Shop’s management team has ten years of business and marketing experience that allows them to market and serve customers in an improved and more sophisticated manner than the competitors.
- Relationships: Having lived in the community for 20 years, Leroy Ford knows all of the local leaders, newspapers, and other influencers. As such, it will be relatively easy for Leroy’s Smoke Shop to build brand awareness and an initial customer base.
- Great service at an affordable price: The complete array of vaping products and services offered by Leroy’s Smoke Shop nearly equals the most premium positioned competitors. However, Leroy’s Smoke Shop will offer these services at a much more affordable price.
- Location: Leroy’s Smoke Shop’s location is near the center of town, giving the company access to people going to and leaving the colleges, clubs, bars, and passersby shopping in the city.
Download the Vape Shop business plan template (including a customizable financial model) to your computer here <–
Financial Highlights
Leroy’s Smoke Shop is currently seeking $350,000 to launch the vape shop. The funding will be dedicated towards securing the retail space and purchasing inventory, office equipment and supplies. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs. Specifically, these funds will be used as follows:
- Store design/build: $150,000
- Equipment, inventory and supplies: $50,000
- Three months of overhead expenses (payroll, rent, utilities): $100,000
- Marketing costs: $30,000
- Working capital: $20,000
The following graph below outlines the pro forma financial projections for Leroy’s Smoke Shop.
Company Overview
Who is Leroy’s Smoke Shop?
Leroy’s Smoke Shop is a neighborhood vape shop located in Portland, Oregon, that sells assorted electronic cigarette products and accessories. The Company will provide a large selection of products including starter kits, vape pens, vape mods, vape pods, dry herb vapes, disposable vapes and flavored liquid. Our shop is located in a convenient spot downtown and will provide a friendly and customer focused environment.
Leroy’s Smoke Shop is led by Leroy Ford, who has been in the vaping industry for ten years. He has spent much of this time working in e-cigarette manufacturing as well as managing several vape shops, smoke shops, bars, and nightclubs in the local market. As such Leroy has an in-depth knowledge of the vape shop business including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).
Leroy’s Smoke Shop’s History
Leroy Ford is an entrepreneur who is passionate about vaping as an alternative to tobacco smoke. Upon surveying the local customer base and finding the potential retail location, Leroy Ford incorporated Leroy’s Smoke Shop as an S-Corporation on January 1st, 2023.
Leroy Ford has selected an initial location and is currently undergoing due diligence on the property. Until the lease is finalized, all operations for the company will be run from Leroy’s home office.
Since incorporation, the company has achieved the following milestones:
- Found location and signed a Letter of Intent to lease it
- Developed the company’s name, logo, and website
- Determined the list of products to be offered
- Began recruiting key employees with experience in vape shops
Leroy’s Smoke Shop’s Services
Leroy’s Smoke Shop will sell an extensive inventory of electronic cigarette products and accessories. Some of these products include:
- Electronic cigarettes
- Electronic cigarette accessories
- Tank refills
- Vaping equipment
- E-liquids
Though most of the shop will be dedicated to vape products, we will also sell regular cigarettes and CBD products.
Industry Analysis
Leroy’s Smoke Shop competes against small, individually owned vape shops and major regional or national chains. According to Grand View Research, the global vape shop market size was valued at $22.45 billion last year and is expected to expand at a compound annual growth rate (CAGR) of 30.6% from now until 2030. This shows that there is a large demand for vape all around the world and that demand will not be decreasing anytime soon.
Vaping in the US has soared in popularity lately, especially amongst millennials and Gen Z, fueling an increased number of vape shops. Going forward, the vape industry will continue to grow, as the US population will likely switch to e-cigarettes, especially youngsters and those who want to quit smoking. As more consumers become aware of the hazardous effects of tobacco smoking, they are introduced to new and safer smoking devices, thereby increasing the demand for these products.
To gain a significant share in the market, the key players are now focusing on adopting strategies such as product innovations, mergers & acquisitions, recent developments, joint ventures, collaborations, and partnerships. The leading players are introducing various e-liquid flavors in the market to cater to the evolving preferences of customers, thereby propelling market growth.
Download the Vape Shop business plan template (including a customizable financial model) to your computer here <–
Customer Analysis
Demographic Profile of Target Market
Leroy’s Smoke Shop will serve the residents of Portland, Oregon and the immediate surrounding areas. Many of the residents in Portland are middle class or affluent and have the disposable income to purchase vape products.
The precise demographics of Portland, Oregon is as follows:
| Total | Percent | |
|---|---|---|
| Â Â Â Â Total population | 1,680,988 | 100% |
| Â Â Â Â Â Â Â Â Male | 838,675 | 49.9% |
| Â Â Â Â Â Â Â Â Female | 842,313 | 50.1% |
| Â Â Â Â Â Â Â Â 20 to 24 years | 114,872 | 6.8% |
| Â Â Â Â Â Â Â Â 25 to 34 years | 273,588 | 16.3% |
| Â Â Â Â Â Â Â Â 35 to 44 years | 235,946 | 14.0% |
| Â Â Â Â Â Â Â Â 45 to 54 years | 210,256 | 12.5% |
| Â Â Â Â Â Â Â Â 55 to 59 years | 105,057 | 6.2% |
| Â Â Â Â Â Â Â Â 60 to 64 years | 87,484 | 5.2% |
| Â Â Â Â Â Â Â Â 65 to 74 years | 116,878 | 7.0% |
| Â Â Â Â Â Â Â Â 75 to 84 years | 52,524 | 3.1% |
Customer Segmentation
Leroy’s Smoke Shop will primarily target the following customer profiles:
- College students
- Young adults
- Local workers
Competitive Analysis
Direct and Indirect Competitors
Leroy’s Smoke Shop will face competition from other companies with similar business profiles. A description of each competitor company is below.
Smoke Shop
Smoke Shop is an online vape shop that has a large selection of products and has been in business for ten years. Smoke Shop offers a wide array of products like vape tanks, replacement coils, kanthal wire and wick, batteries and drip tips, and a huge selection of the most popular vape juice flavors currently on the market. Besides offering vaping products, Smoke Shop also provides a vast array of flavored liquids. It also provides the service of refilling the tank on-site for the customer.
Smoketown
Founded in 2018, Smoketown is the premier online vape store offering a selection of electronic cigarettes, e-liquids, and accessories. The company’s friendly and knowledgeable customer service team is always ready to provide the best customer service experience to ensure customers find what they’re looking for. In its e-cigarette gear shop, customers can find all their favorite electronic cigarette brands and accessories in one location.
Vape 299
Vape 299 is a local favorite known for its large selection of portable and desktop vaporizers. It also has an impressive selection of CBD, pipes, and other 420 accessories that are sold at some pretty low prices. All products sold on Vape 299’s website are strictly authentic. The company’s support team is super friendly, available 24/7 and helpful, and works to quickly resolve any issues customers may have with the ordering process.
Download the Vape Shop business plan template (including a customizable financial model) to your computer here <–
Competitive Advantage
Leroy’s Smoke Shop will be able to offer the following advantages over their competition:
- Management: Leroy’s Smoke Shop’s management team has ten years of business and marketing experience that allows them to market and serve customers in an improved and more sophisticated manner than the competitors.
- Relationships: Having lived in the community for 20 years, Leroy Ford knows all of the local leaders, newspapers, and other influencers. As such, it will be relatively easy for Leroy’s Smoke Shop to build brand awareness and an initial customer base.
- Great service at an affordable price: The complete array of vaping products and services offered by Leroy’s Smoke Shop nearly equals the most premium positioned competitors. However, Leroy’s Smoke Shop will offer these services at a much more affordable price.
- Location: Leroy’s Smoke Shop’s location is near the center of town, giving the company access to people going to and leaving the colleges, clubs, bars, and passersby shopping in the city.
Marketing Plan
Brand & Value Proposition
Leroy’s Smoke Shop will offer the unique value proposition to its clientele:
- Offering a wide collection of vapes
- Convenient location
- Comfortable, customer-focused environment
- Moderate price point
Promotions Strategy
The promotions strategy for Leroy’s Smoke Shop is as follows:
Social Media Marketing
Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. The Company will use social media to develop engaging content in terms of vaping benefits and customer reviews that will increase audience awareness and loyalty. Engaging with prospective clients and business partners on social media platforms like Facebook, Instagram, Twitter, and LinkedIn will also help understand changing customer needs.
Word of Mouth Marketing
Leroy’s Smoke Shop will encourage word-of-mouth marketing from loyal and satisfied clients. The Company will use recommendations and word-of-mouth marketing to grow the customer base through the network of its existing customers. The Company will be incentivizing its existing customer base to encourage their friends to come and try their service for the first time.
Special Offers
Offers and incentives are an excellent approach to assisting businesses in replenishing the churn in their customer base that they lose each year. The Company will introduce special offers to attract new consumers and encourage repeat purchases, which will be quite advantageous in the long run.
Website/SEO
Leroy’s Smoke Shop will develop a professional website that showcases pictures of our products. It will also invest in SEO so that the company’s website will appear at the top of search engine results.
Pricing
Leroy’s Smoke Shop’s pricing will be moderate, so that customers feel they receive great value when availing our vape products. The customer can expect to receive good quality vaping products at a more affordable price than what they pay at an ultra-premium vape shop.
Operations Plan
The operations plan for Leroy’s Smoke Shop is relatively simple as its overhead and cost is small. The functional roles for its employees are as follows:
Operation Functions:
- Leroy Ford will be the Owner and Manager of the vape shop. He will oversee the general operations of the store, help out with customer service, and maintain the shop’s inventory.
- Leroy is joined by Samantha Harris who will act as the Assistant Manager. She will help out with the store’s operations, manage staff, and oversee the store when Leroy is not around.
- Leroy and Samantha will hire a team of full and part-time employees to help run the shop as the store grows and becomes more popular.
Download the Vape Shop business plan template (including a customizable financial model) to your computer here <–
Milestones:
Leroy’s Smoke Shop aims to open in the next six months. The following are the milestones needed in order to obtain this goal.
- 3/202X – Finalize lease agreement
- 4/202X – Begin interior design and construction
- 5/202X – Social media and advertising campaign begins
- 6/202X – Final walk-through of construction and build-out
- 7/202X – Order and pre-stock inventory; hire key employees
- 8/202X – Grand opening of Leroy’s Smoke Shop
Management Team
Leroy’s Smoke Shop is led by Leroy Ford, who has been in the vaping industry for ten years. He has spent much of this time working in e-cigarette manufacturing as well as managing several vape shops, smoke shops, bars, and nightclubs in the local market. As such Leroy has an in-depth knowledge of the vape shop business including the operations side (e.g., running day-to-day operations) and the business management side (e.g., staffing, marketing, etc.).
Financial Plan
Key Revenue & Costs
Leroy’s Smoke Shop’s revenues will come from the sale of electronic cigarette products and accessories. The major costs for the company will be salaries and inventory. In the initial years, the company’s marketing spend will be high, as it establishes itself in the market.
Funding Requirements and Use of Funds
Leroy’s Smoke Shop is currently seeking $350,000 to launch the vape shop. The funding will be dedicated towards securing the retail space and purchasing inventory, office equipment and supplies. Funding will also be dedicated towards three months of overhead costs to include payroll of the staff, rent, and marketing costs.Specifically, these funds will be used as follows:
- Store design/build: $150,000
- Equipment, inventory and supplies: $50,000
- Three months of overhead expenses (payroll, rent, utilities): $100,000
- Marketing costs: $30,000
- Working capital: $20,000
Download the Vape Shop business plan template (including a customizable financial model) to your computer here <–
Key Assumptions
The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and pay off the startup business loan.
- Number of customers per day:
- Year 1: 20
- Year 2: 40
- Year 3: 60
- Year 4: 85
- Year 5 : 115
- Annual lease: $100,000
Financial Projections
Income Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| Revenues | ||||||
| Total Revenues | $360,000 | $793,728 | $875,006 | $964,606 | $1,063,382 | |
| Expenses & Costs | ||||||
| Cost of goods sold | $64,800 | $142,871 | $157,501 | $173,629 | $191,409 | |
| Lease | $50,000 | $51,250 | $52,531 | $53,845 | $55,191 | |
| Marketing | $10,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Salaries | $157,015 | $214,030 | $235,968 | $247,766 | $260,155 | |
| Initial expenditure | $10,000 | $0 | $0 | $0 | $0 | |
| Total Expenses & Costs | $291,815 | $416,151 | $454,000 | $483,240 | $514,754 | |
| EBITDA | $68,185 | $377,577 | $421,005 | $481,366 | $548,628 | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| EBIT | $41,025 | $350,417 | $393,845 | $454,206 | $521,468 | |
| Interest | $23,462 | $20,529 | $17,596 | $14,664 | $11,731 | |
| PRETAX INCOME | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Use of Net Operating Loss | $0 | $0 | $0 | $0 | $0 | |
| Taxable Income | $17,563 | $329,888 | $376,249 | $439,543 | $509,737 | |
| Income Tax Expense | $6,147 | $115,461 | $131,687 | $153,840 | $178,408 | |
| NET INCOME | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 |
Balance Sheet
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| ASSETS | ||||||
| Cash | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 | |
| Accounts receivable | $0 | $0 | $0 | $0 | $0 | |
| Inventory | $30,000 | $33,072 | $36,459 | $40,192 | $44,308 | |
| Total Current Assets | $184,257 | $381,832 | $609,654 | $878,742 | $1,193,594 | |
| Fixed assets | $180,950 | $180,950 | $180,950 | $180,950 | $180,950 | |
| Depreciation | $27,160 | $54,320 | $81,480 | $108,640 | $135,800 | |
| Net fixed assets | $153,790 | $126,630 | $99,470 | $72,310 | $45,150 | |
| TOTAL ASSETS | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 | |
| LIABILITIES & EQUITY | ||||||
| Debt | $315,831 | $270,713 | $225,594 | $180,475 | $135,356 | |
| Accounts payable | $10,800 | $11,906 | $13,125 | $14,469 | $15,951 | |
| Total Liability | $326,631 | $282,618 | $238,719 | $194,944 | $151,307 | |
| Share Capital | $0 | $0 | $0 | $0 | $0 | |
| Retained earnings | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| Total Equity | $11,416 | $225,843 | $470,405 | $756,108 | $1,087,437 | |
| TOTAL LIABILITIES & EQUITY | $338,047 | $508,462 | $709,124 | $951,052 | $1,238,744 |
Cash Flow Statement
| FY 1 | FY 2 | FY 3 | FY 4 | FY 5 | ||
|---|---|---|---|---|---|---|
| CASH FLOW FROM OPERATIONS | ||||||
| Net Income (Loss) | $11,416 | $214,427 | $244,562 | $285,703 | $331,329 | |
| Change in working capital | ($19,200) | ($1,966) | ($2,167) | ($2,389) | ($2,634) | |
| Depreciation | $27,160 | $27,160 | $27,160 | $27,160 | $27,160 | |
| Net Cash Flow from Operations | $19,376 | $239,621 | $269,554 | $310,473 | $355,855 | |
| CASH FLOW FROM INVESTMENTS | ||||||
| Investment | ($180,950) | $0 | $0 | $0 | $0 | |
| Net Cash Flow from Investments | ($180,950) | $0 | $0 | $0 | $0 | |
| CASH FLOW FROM FINANCING | ||||||
| Cash from equity | $0 | $0 | $0 | $0 | $0 | |
| Cash from debt | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow from Financing | $315,831 | ($45,119) | ($45,119) | ($45,119) | ($45,119) | |
| Net Cash Flow | $154,257 | $194,502 | $224,436 | $265,355 | $310,736 | |
| Cash at Beginning of Period | $0 | $154,257 | $348,760 | $573,195 | $838,550 | |
| Cash at End of Period | $154,257 | $348,760 | $573,195 | $838,550 | $1,149,286 |
Vape Shop Business Plan FAQs
What Is a Vape Shop Business Plan?
A vape shop business plan is a plan to start and/or grow your vape shop business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.
You can easily complete your Vape Shop business plan using our Vape Shop Business Plan Template here.
What are the Main Types of Vape Shop Businesses?
There are a number of different kinds of vape shop businesses, some examples include: Convenience Store with Vape Section, Vape Lounge, Vape Showroom, and Online Vape Shop.
How Do You Get Funding for Your Vape Shop Business Plan?
Vape Shop businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.
What are the Steps To Start a Vape Shop Business?
Starting a vape shop business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.
1. Develop A Vape Shop Business Plan - The first step in starting a business is to create a detailed vape shop business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.Â
2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your vape shop business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your vape shop business is in compliance with local laws.
3. Register Your Vape Shop Business - Once you have chosen a legal structure, the next step is to register your vape shop business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.
4. Identify Financing Options - It’s likely that you’ll need some capital to start your vape shop business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.
5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.
6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.
7. Acquire Necessary Vape Shop Equipment & Supplies - In order to start your vape shop business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.Â
8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your vape shop business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising.