Vaping has taken off. The sweet-smelling market has grown exponentially since it first became a thing in the late 2000s. The latest figures suggest there’s 3 million vapers in the United Kingdom, up from around 700,000 in 2012.
Those are huge numbers. Especially for a market that’s addicted (literally) to the product it craves. Tobacco companies saw potential in the e-cigarette market and started buying up companies as they flourished a decade ago. A report commissioned by Cancer Research UK found the top five brands are owned by tobacco companies.
Suffice to say, the big dogs are in on it. And there’s space for you too.
Financing a vape shop
The market is established. It’s growing. The regulatory framework for e-cigarettes allows them to be sold to anyone over the age of 18.
So, you know who your customers are. You know the market’s healthy. What’s stopping you from getting in on it? As with most entrepreneurial ideas, it’s money that hinders the dream. But it doesn’t have to with yours. You can set up your dream vape shop with a loan.
Vape shop start-up costs
Setting up a vape shop isn’t a cheap enterprise. It will cost you over £10k. Thankfully, finance for vape shops is available, and you could receive the funds you need to get started in less than 48-hours. Perfect if you’re eager to get started.
Here’s a handful of the things a high-street vape shop will need to pay for:
- Security deposit for property lease – £1,000
- First month’s rent – £750 per month
- Business rates – £5,000 per year
- Construction costs for fit-out – £2,000
- Store fixtures and fittings – £1,000
- Office equipment – £200
- Inventory and stock – £5,000
- CCTV system – £800
- Shutter system – £600
- EPOS till system – £600
- Branding – £1,500
- Trademark registration – £200
- Exterior signage and vinyl – £400
- Interior signage and décor – £400
- Public relations and marketing – £600
These estimated costs quickly add up. You’ll need plenty of cash to get started.
Business rates are the biggest killer and can determine whether setting up a shop in a specific location is worthwhile. Rent is another killer. It’s important you find a lease that is competitive and can tie you down for over 2-years. Moving is expensive.
Loan types for vape shops
The best loan for a vape shop with no assets is an unsecured loan. Unsecured loans are suitable for amounts of less than £50k. Most vape shops will need a cash injection of £10k to £25k to get started. With an unsecured loan you borrow money with a written agreement you’ll make regular repayments. Nothing is secured against the loan.
An unsecured start-up loan is a great way to setup a vape shop. It gives you instant capital and it is easy to budget for with regular monthly repayments. The key to getting a good deal is to look out for the interest rate. The interest is the amount the lender earns on the money they lend to you. Our rates start from just 3.6% over one to five years.