Are YOOZ Physical Stores Profitable?

Are physical vaping device stores profitable? In fact, this question is much like asking whether any investment is profitable. Every investment carries risk and should be approached carefully. In any industry, whether profitable or not, some people lose money, some make money, some do well, and some do poorly.

No investment is risk-free or guaranteed to make money. So whether a physical vaping store makes money depends on many factors, and no one can say with certainty that opening a store will guarantee profits. Looking at it from another angle, if you do not open a vaping store and instead open a restaurant or supermarket, does that guarantee profit? Obviously not.

The same principle applies: even highly profitable sectors have people who lose money, and even less profitable ones have people who succeed. The difference is that some industries offer a higher probability of profit, some lower; some are harder, some easier. So what we should really consider here is the industry’s potential, level of saturation, and stage of development, rather than getting stuck on whether it makes money or not. To decide whether an industry is worth entering, you need to ask whether it is a sunset industry, a mature industry, or an emerging one, and whether it will have sufficient market size and growth potential in the future. Those are the key prerequisites when deciding whether to invest in any industry.

So let’s first look at the vaping market from a macro perspective. Choosing what industry to invest in, and when to enter it, is extremely important. Compared with other traditional industries such as food service and retail supermarkets, vaping is clearly still in its early stages in China. According to statistics and industry analysis from multiple investment institutions, the global vaping market has been growing at a compound annual growth rate of around 15%. In 2019, the market size of vapor-based e-cigarette products was about US$35.2 billion, and it is expected to reach US$82 billion by 2023. From 2019 to 2023, China’s compound growth rate is projected at 23.5%, far above the global average. China has seven times as many smokers as the United States, yet vaping penetration is only 1.2%, compared with 30% in the U.S. Based on 2019 statistics, China had 286.7 million smokers. At a 30% penetration rate, the industry’s potential market size would reach RMB 112.9 billion, comparable to the new energy vehicle sector. So from a macro perspective, China’s vaping market is clearly just getting started, with enormous future potential, making it an emerging industry worth investing in.

Next, let’s look at what support the CP (brand owner) provides for opening a store. As one of the most popular vaping brands on the market, YOOZ announced at the beginning of 2021 that it would launch its “10,000 Stores Plan” after the Lunar New Year. All policies under this plan are available nationwide. The main goal is to leverage YOOZ’s brand advantages and favorable policy support to help franchisees open stores more easily.

In addition to store-opening subsidies and standardized operations and management training, YOOZ also provides official brand campaigns and a full range of supporting measures such as the “Good YOOZ” CRM management system to help channel partners and store owners manage operations, build a good business, and make money together. In terms of investment size, the cost for ordinary entrepreneurs is relatively low. Basically, around RMB 30,000 to 50,000 is enough to open a new store. With YOOZ’s dedicated subsidy funds, new store owners can worry less during the early stage and have enough time to get through the “difficult period,” without stressing too much about limited experience, weak marketing, low initial customer traffic, or poor early profitability. This shows that the YOOZ brand offers strong support for ordinary store owners.

Finally, let’s consider from the operator’s own perspective what other important factors need to be taken into account when opening a YOOZ physical store.

Step one: secure a favorable location. Choosing the right store location plays a decisive role in business performance. As the saying goes, “A tiny difference in location can mean a huge difference in sales.” In the industry, this is called “securing the dock.” In fact, this is the most important factor for any physical retail store. You need to consider whether the location, customer traffic, and the business you plan to operate are a good match, and, within your budget, try to secure the best possible site.

Step two: brand influence. A strong name gives legitimacy and recognition. The importance of the store name affects your business image and directly influences product sales. In this regard, YOOZ’s strong market influence as a leading brand gives it a natural advantage.

Step three: interior design style. The store’s design directly affects its image. Success does not depend on luxury, but neither is it wise to go for something crude and shabby just to save money. What matters is practicality, individuality, and a sense of quality. In this area, store owners do not need to worry, because the brand provides a unified supporting package and design style that is stylish and distinctive, appealing to young consumers who prefer a fashionable and minimalist aesthetic. Store owners do not need to stress about how to decorate the shop. #p#Page Title#e#

Step four: operating activities and advertising. Advertising and promotional campaigns have become essential routine tools. YOOZ provides store owners with extensive campaign support, including gifts and related promotional materials, which is a clear advantage. Of course, store owners still need to handle daily customer maintenance, customer engagement, service quality, and operational management. In my personal view, aside from the main merchandise, some peripheral products should be given away when possible (provided that doing so encourages customers to buy more and increases average order value), and discounts should be offered where appropriate. In addition to official holiday promotions, store owners can also run their own campaigns, such as discount cards for repeat purchases. Add customers on WeChat to make follow-up marketing easier, manage customer relationships well, retain customers, and encourage repeat purchases. Modern marketing has in fact shifted from marketing products to marketing customers. These are all basic skills that a qualified store owner needs to learn and master.

In the end, many vaping specialty stores still do not make money. The market is reshuffled almost every year: some money-losing stores close, while new store owners continue to enter. But this is simply the market’s process of survival of the fittest. This risk exists not only for YOOZ specialty stores, but for any physical retail business. From what I understand, stores that perform well can easily make RMB 200,000 a month, while poorly run stores may make only a few thousand yuan a month, not even enough to sustain operations. So once again: investing involves risk, and entering any industry should be done cautiously. Although the vaping industry is an emerging sector with huge potential and a low entry barrier—you can get started with just tens of thousands of yuan—it still requires a certain level of investment and capability. Only by managing customers carefully and operating wholeheartedly can you run the business well.