Excuse me if this isn't the proper place for this question. But I didn't know where else to turn...
I was in a local shop yesterday where a friend of mine works, and I was talking to him and the owner of the shop and I was telling them about how I was planning on venturing into making my own juice line, and how I was planning to have it sold in local shops after a while. The owner told me that this was a great idea, but that I should move quickly because of new laws that are coming.
He told me that soon, nationwide, companies that produce eliquid will have to pay the government $50,000 per flavor of juice that they have in their lineup, also you'll be needing a license just to buy nicotine base, and that soon the price to get a license will be around $15-$20,000.
I've heard of states changing laws lately (Indiana being the closest since I live in Ohio) that have been putting all kinds of restrictions on making your own juice. Security firms patrolling your building, ridiculous insurance policies, level 1 clean rooms required, etc...
Can anyone shed some light on this? I have a great name, marketing campaign and flavor profiles lined up to get this off the ground. But, if I can't do it without making a $100,000+ payment to the government, then I see no point. Thanks in advanced!
I don't think that's 100% accurate; no legislation for regulation has passed so it's up in the air still.
That's what he was saying. That it hasn't passed yet. But it should in June, which then it takes 90 days for it to actually take affect. So he was saying basically in October it was changing to the new law. He said he's seen companies starting to trim down their flavor profiles and everything in anticipation of this.
What he is likely talking about is the FDA fnalizing their Deeming Rule they posted last April. They will be finalizing in June but effective law wont go into effect for a while after that. The problem with the Deeming rule right now is that unless your product was on the market before 2007, you have to apply for pre-market approval, which indeed will cost upwards of 30,000 dollars as you have to prove, not claim, but prove your product is "good" for publoc health and you and your operation are up to snuff (clean room, refridgeration, osha health standards etc) to be able to legally sell your product. Whether you have a product on the market after 2007 doesnt mean jack shit. (Unless FDA changes the grandfather date) 99 percent of the existing market cant meet FDA standards which is why you'll hear the advocates screaming the the regs will hand over the market to Big Tobacco. Unfortunately, its not cool to be an advocate, so the collective "we" havent fought hard enough to save the whole vaping industry. The basic advice I have for any new, young person wanting to get into the business is "know the law", including proposed law. You could lose your shirt in this market, either with state regs or federal regs. Some well established businesses are already losing their shirt because local state or town regs place so much tax on their product that they cant compete with "online sales". Also, even a fully online business has to take care of IT needs, such as keeping records, backups and paying taxes and information security. Can you hire an IT guy? How about insurance? What happens if someone got sick from your juice because you titrated wrong? Are you keeping samples of every batch for a year or more to protect yourself in case of a lawsuit? What about testing for diacytel? Can you afford that test on ever batch? Point is, think this through. Eliquid is not as simple as making tasty juice and selling it for 20 dollars a pop. We are going to witness a huge consolidation of the market and will likely see 50 percent of the business go under by 2020. Be careful and be thoughtful.
That's a very well thought out and written response. I'm recently going through the considerations of what it would take to start a line, and do it right. At a high level, seems pretty simple, but even now without all the looming regulations, there's a lot to consider that people don't realize. So in the meantime, I'll get all my fucking ducks in a row doing cost sheets and business plans and see what the fuck happens in a couple of months. The market is still really young, and if the guvmit don't fuck it up there's still plenty of room in the pool, just heed Typo's advice.
Correct me if I'm wrong, but at the last ecig "roundtable" wasn't the number thrown out by the FDA for estimated cost to market something absurd like $10,000,000 per SKU?
I seem to recall it being something ludicrous like that.
Essentially if we don't get congress to act and change the grandfathering date for vaping, or the courts to throw out the whole tobacco deeming, the FDA is basically gonna roll this whole thing up and hand it to big tobacco/big Pharma, as they're the only ones that will be able to afford the cost to market.
It's sad.
No. No one knows what's going to happen, and what you just stated is an absolute worst case scenario mostly perpetuated by zealots who the the 'gumnit' is gonna take everything away from them. And every company I've seen is expanding their lines, not shrinking them. While things are going to change, and I expect clean rooms to be required, no one knows at all what's going to happen.
Do you live in the south? We get a lot of those types down here.
About trimming down their flavor profiles: see my other comment. Similar registration requirements were recently proposed in the cigar trade (where they remain in committee deliberation). Many cigar manufacturers actually rushed several blends out last year because if the law passed, all existing cigars would have been grandfathered in.
I imagine if chemical analysis and registration (what he's talking about with the fees per blend thing) became mandatory, they'd do something similar where old flavors would be grandfathered in. Retroactively imposing requirements on these types of products has shown to be troublesome in the past.
You can read a little more about the war we fought last year in the cigar trade at http://halfwheel.com/fda
I know it is not strictly related to vaping, but what this guy is talking about is EERILY similar to what we were dealing with Q2 last year in the cigar trade.
Yes, technically those guys are right, but I think they are completely underestimating those numbers. There's talk that it's going to take MUCH more money PER FLAVOR, to get passed through the FDA, and also MUCH higher fees yearly. This will wipe out 99% of the ejuice market as only a few companies like Suicide, Cuttwood, Cosmic, can afford to have this done. What else will happen is it's going to take a lot more money to get an ejuice line, and basement ejuice companies will no longer exist. Maybe it's a good thing, but for guys like you and me who make their own juice for themselves and friends and family, we're fucked. So hopefully things go our way, although I'm VERY pessimistic, and I've been stocking up since I first heard about such 9 months ago.
If you haven't heard about looming regulations, and aren't actively involved in helping to influence them, then I say don't quit your day job.
I love how he hasn't even started diying and is talking about "starting a juice line" like it's just a quick little Diddy. I've been making juice for almost a year and I don't have anything close to a "juice line".
Yea, it's the new gold rush. Oh, I have a snappy snappy name I'm gonna get rich selling juice!!! I didn't even mention the cost of insurance. Let him dream a little longer. Better to spend a buck on a lottery ticket.
> I love how he hasn't even started diying and is talking about "starting a juice line" like it's just a quick little Diddy
That's like 33% of this sub's posts. With the other hand being everyone in ECR whining about prices because they don't understand the overhead of a high risk industry, lol.
I'm in the works of closing up shop on a juice company I started last year. Been mixing over two years now. It wasn't worth trying; I would have had to quit my job and hire people just to keep up with orders. Even then, I'd have been making less money and probably had less free time, more stress.
Beyond that, any store you go into with info and samples is pretty much 'yeah we will take some FREE SAMPLES OF YOUR JUICE.' And then never contact you again.
I sell juice to a group of people my age. I do think advertise or anything, everyone just loves my juice and it's spread through word of mouth pretty fast. Just from making juice for about a dozen people I would never attempt to keep up with an actual customer base.
The FDA has not stated how much it will cost to submit an e-liquid recipe for evaluation.
The FDA does not have the power to enforce licensing the sale of Nicotine.
Go to the FDA website and educate yourself, they have documented how they propose to regulate e-liquid and it's not hard to understand, nor a long read.
My advice? Wait until June when they finalize and announce their regulations, then decide if it's a market worth getting into.
Well he has a point, if you aren't already an established juice maker its going to be extremely difficult to make it when regulations pass. Even well known companies will have a hard time making it if they pass really strict rules. Regulations are inevitable, the government will always control any market where money is being made. It was just a matter of time, most of the regulations they have passed here in texas have been about age. Which most quality vape shops didnt sell to minors in the first place. We haven't heard too much about juice making regulations yet, nothing in writing at least.
Well as I always say, as long as they don't or can't completely restrict the sale of nicotine base then we will always have DIY. They won't be able to ban PG or VG, as it's used in too many things. Flavoring? Nope. Companies like Capella and Lorann have been selling flavor for decades for food. All they're doing is trying to scare us back into smoking tobacco. FUCK them. I'd quit vaping first.
I'm from Indiana and the bill is pretty mixed. Since there is no regulation any for juice, it'll be interesting to see how fast this catches on. I don't think anybody knows how this is going to affect vape shops around here, but I can't see it helping them out.
To do it right. At this stage in the hand you're going need bare minimum of 20k to get started. Going about it the right way of course. I know. I have experience in this field.
According to the FDA site, there is a conference June 1-2. They are open for public comments on the proposed regulations through sometime in July. The link below should help answer questions, and point you in the direction of learning more on the topic.
http://www.fda.gov/NewsEvents/PublicHealthFocus/ucm172906.htm
Something similar with the chemical analysis registration fee was recently proposed in the cigar industry. As far as I know, the proposed legislation fell off the radar and is no longer an issue.
They wanted something like 150k per size in each blend of cigar to establish a chemical analysis of the product.
Everyone was like "lol wut? It's a cigar, it's tobacco. One ingredient and it came out of the ground. Sure tobacco on it's own has several chemical compounds in it: nicotine, flavinoids, etc. This doesn't mean it's combustion properties have changed much in the last 300 years."
So far as I know, this legislation fell off the radar and has not been brought back up. It was, after all, fairly ridiculous.
EDIT: Actually, the deeming rule has been referred to a committee for review. Although it is not strictly related to vaping, you might consider reading up on the following two legislative actions, as similar actions may soon face the vaping community if they have not already:
https://www.congress.gov/bill/113th-congress/senate-bill/772
https://www.congress.gov/bill/113th-congress/house-bill/792
As a final note, (I didn't mean to make three comments, I'm sorry) a certain amount of regulation is coming, you can be sure of that. We cannot self-regulate forever. I wish we could vote with our wallets, but the problem with that is the govt cannot capture enough of or revenue stream that way. It's sad, but we must all realize that as the vaping community grows, the attention of the feds will turn more and more to what we're doing. If they can find a way to monetize it, they will.
I would prepare for some kind of taxation. Whether it's a floor holding tax built into the product at the wholesale level or an additional tax like Pennsylvania is proposing right now (40% is stupid though), there will be some kind of tax.
I would prepare for some kind of production inspection and requirements. Remember when a few of us raised pitchforks at nude nicotine for releasing double-strong 100mg/mL batches? That't can't ever happen. Seriously. The resulting lawsuit will erase a business from the map.
Finally, I would prepare for some kind of oversight. Most brick and mortar shops I see these days have some kind of tobacco license hanging with their tax resale certificate. That's great. Some do not. If you own a Brick and Mortar, you should be prepared for ATFE to come in and check you out once in awhile.
It's usually fairly painless. I now manage a cigar shop and work in a vape shop and the ATFE lady is very nice (and surprisingly fair). But we must be cautious to dig our heels in on the issues that really matter, while allowing a fair amount of leeway on certain regulation.
Of course, for some, there will always be DIY. :D
this is accurate. i run two juice lines and a shop in Dfw. you have two years. start mixing now
Can you elaborate on this? What did you mean by you have two years?
After the FDA deeming is published and finalized, the rules go into effect in two years from that date.