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WINSTON-SALEM, N.C. (AP) — The founders of Avail Vapor entered the electronic-cigarette business in 2013 with their eyes open to the opportunities and roadblocks of an industry operating in a Wild Wild West mode.
The Richmond, Va., company is operating 33 stores in three states, including one in Winston-Salem at 2005 Frontis Blvd., two in Greensboro and nine overall in North Carolina. There are plans to open five more N.C. shops this year.
E-cigarettes are battery-powered devices that heat a liquid nicotine solution of varying strengths in a disposable cartridge and create a vapor that is inhaled. A vaporizer can be supplied and reused through the insertion of a liquid capsule.
Each Avail shop sells about 80 flavors of nicotine liquids, all made in a clean-room environment.
James Xu, a co-founder and chief executive, said he believes Avail stands out in a cottage industry where vape shops have popped up like mushrooms in Triad shopping centers and strip malls.
"We would like to become the Starbucks of vaping," Xu said.
"We believe we are part of a societal trend similar to how cell phones have eclipsed landline phones."
Xu's confidence comes primarily from targeting smokers ages 30 to 50 who are either trying to quit traditional cigarettes or want a potentially less-harmful nicotine product option.
For example, Xu said Avail's stores are mostly in urban cities with a significant concentration level of smokers according to Centers for Disease Control and Prevention data.
"We target the concentration levels of smokers from a financial standpoint because those smokers already dedicate a percentage of their income to nicotine products," Xu said. "We're just trying to get them to shift their spending to us."
Avail emphasizes tobacco-flavored liquids, though careful not tie the flavor to a specific traditional cigarette brand to avoid potential lawsuits from tobacco manufacturers. Xu said "most smokers' taste buds have been dulled by smoking, and other flavors aren't appealing at first."
As the taste buds began to recover, Xu said many adults transition to a coffee flavor before attempting candy, fruit and other flavorings.
Avail is expanding aggressively as the tobacco and pharmaceutical industries, and anti-tobacco and anti-smoking advocacy groups wait on the Food and Drug Administration to announce additional regulations on smokeless products, such as e-cigs, vaporizers, heat-not-burn cigarettes and snus.
In June 2009, Congress gave the FDA the ability to regulate tobacco products and marketing, but not the authority to ban nicotine or tobacco. The FDA has to approve any new tobacco product being marketed as a potential reduced-risk product compared with combustible cigarettes.
Where the Wild Wild West environment has emerged is in the absence of FDA e-cig regulations outside recommendations announced in April 2014 to ban sales to those under age 18, require health warning labels, an FDA review of existing and future products, and no more free samples.
The FDA did not curtail Internet sales or current marketing efforts that include television and social media. Xu said 2 percent of Avail's sales are online.
"We will be in a position to adhere to whatever final regulations that FDA hands down," Xu said. That includes switching to vaporizers that do not allow for inserting liquids.
"We believe FDA regulations will help our business immensely because it will help root out the bad actors that may be putting customers at risk with how they make their liquids," Xu said.
"Currently, the entry level into vaping is very low and the flood gates remain open."
Xu said he understands the concerns of anti-tobacco advocates who say e-cigs and vaporizers are serving as a gateway to traditional cigarettes, particularly since they are sold in flavorings not available with traditional cigarettes. Those advocates tend to tout a "quit or die" philosophy on tobacco products.
Other anti-tobacco advocates, who believe e-cigs can play a reduced-risk benefit to public health, said the jump in e-cig usage is a positive development considering traditional cigarette usage "reached historical lows among teens in 2014 in all three grades."
"We're putting together the technology so that for our bar codes, you can scan it and pull up the test results so you can see the consistency in our manufacturing and our products," Xu said.
"It is part of our way of showing we want to be in business for the long term," Xu said.
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Information from: Winston-Salem Journal, http://www.journalnow.com
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