Vapor shops are becoming the primary driver of the electronic cigarette industry, likely due to the significant increase in the number of locations nationwide and the personal touch vape shop employees provide, a recent study suggests. Brick-and-mortar shops have grown from just a few hundred several years ago to between 6,000 and 8,000 in 2015, driving the growth in the tanks and mods segment. Of the $2 billion in sales of these products expected this year, $1.2 billion will come from sales in local shops.

Overall, sales of e-cigarette supplies are expected to reach $3.5 billion in 2015, double that of sales in 2013, and seven times the estimated $500 million in sales in 2012, according to Roebling Research.

Our findings show signs of maturing businesses with many increasing in operating experience, number of locations, and developing sales through the online and brick-and-mortar channels.

A Driving Force for the Industry

Although there are certainly other factors involved, the massive growth in sales has been heavily impacted by how quickly brick-and-mortar vape shops have expanded across the country. Roebling found that of the owners it surveyed, 86 percent opened their locations within the past two years, and half in the last year. Making vapor products easily accessible locally has undoubtedly contributed to the popularity of vaping, and vapor shops are likely to shape the industry moving forward.

Think of it this way: for those of us who have been at it for a while and don't live in big cities, chances are we were forced to drive long distances to stock up on the best e-juice and box mods, or search around for it online. Now you're much more likely to have a retail vape shop only a short drive away.

For a newbie, it's much more enticing to give vaping a try, given the ever increasing number of personal vaporizers, mods, atomizers, tanks and whatnot out there. It's hard to pick the right product if you have no experience, and vape shops provide a level of service you won't find online, or at traditional retail outlets or convenience stores that carry a limited selection of products.

Vape shops know that consumers new to the practice require handholding when it comes to selecting the right gear and using a personal vaporizer for the first time,” says Roebling.

Getting people started on the right path will keep them coming back time and time again, and hopefully help them to avoid (or quit) smoking. It's also good for long-time vapers, as we have the option for instant gratification and impulse purchases, which I'm willing to bet most of us have done at one time or another. It's much easier to say “no” when you're shopping online – at least for me.

Today's retail vapor stores carry a wide array of products and offer a relaxed atmosphere to ask questions, test new gear and sample e-juice. Some shops specialize in certain types of products, such as mechanical mods and RDAs, while others offer a more diverse selection with varying levels of expertise. Many vape shops are also using custom e-juice as a way to keep their customers coming back, with 68 percent of vapor shops selling their own private e-juice lines.

The Future Of Retail Vapor Stores

So where does the vape shop go from here? Although the majority of business owners in the Roebling survey owned single-location vape stores, 46% were part of multi-store chains. Successful shop owners are likely to open additional locations as vaping continues to gain popularity. For those that do, they gain the advantage of more purchasing power and broader reach, which can in turn lower overhead and allow them to compete with online retailers and provide lower prices across the board.

Online retailing is another avenue successful brick-and-mortar vapes stores are likely to take. With expectations of a 25% increase in online sales in 2015, getting online and selling to a wider audience is a potentially lucrative move for those that are willing to commit the extra time and resources.

The big question that looms over the entire vaping industry, though, is the impact of newly proposed city, state and federal regulations. Although the vaping industry is certainly booming, the potential for damaging regulations is still present, and the risk varies from state to state.

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