In the last ten years, electronic cigarettes have exploded from non-existence to a $3.5 billion industry. An industry which up to a few months ago the US Food and Drug Administration (FDA), seemed set on destroying.
Then last August, the FDA announced a major shakeup to the agency’s policy on e-cigarettes which includes the de-nicotinization of cigarettes, and a PMTA deadline delay. Following that announcement, the FDA had issued a guidance titled Extension of Certain Tobacco Product Compliance Deadlines Related to the Final Deeming Rule, in order to formalize and explain this deadline extension.
“The further extension of premarket review compliance deadlines covered by this guidance applies to all categories of newly regulated products that were on the market on August 8, 2016, including ENDS (e.g. e-cigarettes and e-cigars), hookah, pipe tobacco, and cigars. The compliance dates are being extended from November 8, 2017 (SE EX requests), May 8, 2018 (SE reports), and November 8, 2018 (PMTAs) to August 8, 2021 (SE EX requests, SE reports, and PMTAs for newly regulated combustible tobacco products, such as most cigars, pipe tobacco and hookah tobacco) and August 8, 2022 (SE EX requests, SE reports, and PMTAs for newly regulated noncombustible tobacco products, such as most ENDS or ecigarettes).” read the guidance.
Some hope at last
E-cig Intelligence, a news-led independent agency, that specializes in tracking and covering regulatory changes in the industry, has recently carried out a survey amongst US vape shops. The data collected indicates a surge of optimism amongst 77% of the remaining retailers.
Whilst before the announcement more businesses were preparing to close their operations, 50% of the respondents said that they are now looking into increasing their stock levels, and 42% even said that they are planning to expand their business.
Below is a press release that E-cig Intelligence shared with us at Vaping Post :
US vape stores respond to FDA announcement with increased optimism
77% of retailers show optimism towards the industry after FDA announcement, survey says
US vape stores are enjoying renewed positivity about their future following the FDA’s recent decision to postpone key regulatory deadlines, a recent survey has shown.
The independent survey represents over 1,000 US vape stores, and was conducted by e-cigarette industry data provider ECigIntelligence. The responses showed a 31% increase in vape store operators having a positive outlook on the future of the vaping market in the US.
Before the FDA announcement in July, most vape stores had arrested any expansion plans and cut back on general spending; the survey shows that since the announcement, many retailers are planning the expansion of business or stock levels. 77% of retailers are feeling some industry optimism, an immediate 25 % increase on responses received before the FDA decision; 50% of respondents are now looking to increase stock levels, and 42% plan to expand their operations. More than 10% have no plans to take any action as yet and will await further regulations before deciding.
Price pressure
Average monthly revenue per store shows no change compared with 2016, at around $27,000. While the ratio of mods and starter kits have increased, the e-liquid share of revenue has decreased, which reflects the increasing price pressure on e-liquids and the growing popularity of larger bottle sizes.
Also, the number of stores that offer in-house e-liquid has increased from last year. For those that offer both in-house and third-party brands, in-house e-liquids on average account for more than half of their e-liquid revenue
