Vape Shops Need to Rethink Their Business Plan in Light of Deaths

Just a year ago vaping was being touted as a safe alternative to cigarettes and other products containing nicotine. It seemed as though everywhere you turned, a new brick and mortar vape store was popping up. That was then. Now, it looks as though the vaping industry could go up in smoke and your business along with it. If you own a vape shop, should you be concerned? More importantly, what should you do now?

What's Going On?

This past summer, health officials in a varies states began receiving reports of people developing severe breathing illnesses. The only common factor in the illnesses was that the patients had all recently vaped. To date, more than 500 people are suspected or confirmed to have sustained vaping-related illnesses, and at least ten have died. As of the date of this post, numerous states have imposed some type of ban, temporary or otherwise, on marketing or selling vaping related products. 

FDA Deadlines

For years, e-cigarette manufacturers, and related companies selling vaping products operated without FDA approval. In 2016 the FDA determined that e-cigarette products fell under the same umbrella as cigarettes and smokeless tobacco, which are regulated by the FDA. Initially, the FDA set a deadline of August 2018 for e-cigarette companies to file applications to market their products. 

However, in 2017 former FDA Commissioner Scott Gottlieb, as part of his plan to curb nicotine levels in traditional cigarettes, decided to extend the filing deadline to 2022. He believed that e-cigarettes could be beneficial to his plan by giving adult smokers an alternative to conventional cigarettes. In light of the vaping relating deaths and illnesses, the application deadline has been moved to May 2020. 

Many people are pointing the finger at Gottlieb, and the FDA for the vape-related illnesses. Some believe that the current situation would not exist had the FDA set shorter filing deadlines. 

State Regulations 

As noted above, various states have enacted bans on selling or marketing vaping products. Massachusetts was the first state to prohibit their sale for four months while health risks are analyzed. It is expected that many more states will follow suit shortly. 

What Are Shop Owners Saying?

Obviously, those who sell vaping products, especially those in Massachusetts, are not happy. According to an article on Boston.com, one shop owner feels "violated" by the Massachusetts ban. The article goes on to say that shop owners are blaming the illnesses and deaths on black market marijuana cartridges. 

The Writing is on the Wall

From a business perspective, the writing is clearly written on the wall. What once might have been a lucrative business is now going up in smoke. In fact, the CEO of Juul, the leading e-cigarette company, recently stepped down and was replaced by K.C. Crosthwaite, who was the chief growth officer at the tobacco company Altria. Vaping products could soon be banned, or be so heavily regulated that it will be difficult for vape shops to survive. 

From a Business Perspective . . . What Do You Do?

I have seen a wide array of responses on business sites focused around vaping. Some industry representatives suggest that vape shops begin carrying alternative products like CBD oil and infused foods. Whether this is a good idea or not is uncertain. However, what is critical is that vape shop owners start looking at products and service to initially supplement and ultimately replace vaping products. When doing so, you would be foolish not to consult with an attorney, especially if you begin selling food-based products.  

However, vape shop owners need to look at whether they can survive on the sale of alternative products and services. Just because you put "so much" time and effort into your vape business does not mean that you should go down with the Titanic. Business is fluid; it changes rapidly. If you want to be a successful entrepreneur, you need to be able to adjust to the waves and know when it is best to abandon ship. 

Another reason to speak with a lawyer is for help analyzing what your rights are concerning any business loans or leases that you may have entered into. 

Now, don't get me wrong; it is possible that the industry could survive. However, if I owned a vape shop, I would not be waiting around to see what happens. Just look at what happened to the smaller pipe tobacco and cigar manufacturers and related retail stores when the FDA began regulating premium cigars and pipe tobacco. They folded. If you are worried about the future of vaping products, (and you should be), now is the time to establish "Plan B." In the immortal words of George Washington, "If we are wise, let us plan for the worst."