(NOTE: This story appears in the May 2024 issue of ED Magazine.)
With placement, installation, remote updates, service, custom stock and replenishing, taxes and licensing all managed by the vendor, Jordan Brown and VapeTM provide effortless supplemental profits for club owners.
VapeTM is a vape vending machine company which originated with an entrepreneurial idea from a third-generation partial owner of a jukebox, ATM and vending company, based out of Cleveland, Ohio. Bred with a certain business acumen, as well as a literacy for market data, founder and owner Jordan Brown saw the opportunity in vape vending machines in the numbers, which were “exploding in Europe.”
After a successful trial with a machine he purchased and assembled himself in his uncle’s bar, Brown knew he had a winner, so he expanded his enterprise: first, throughout Ohio, and then, the country. The demand for his vending machines was broad, according to Brown, because many establishments either didn’t yet have a vape dispenser, or did have one which wasn’t in agreement with the law.
When he spoke to the establishment owners about these concerns, many admitted that they were unaware, and claimed that their vendor “took care of it.” Even so, Brown knew legally that the liabilities were shared.
“I kind of felt bad for the owners,” he shares. “I don’t think that they or the vendors had any intentions of not following the law, which is, after all, complicated.”
Not only were many machines operating illegally, but Brown felt that they were also unsightly, with poor graphics and product selection.
“So, I got involved with a national law firm and figured out how to streamline a lot of licensees and tax implications,” he says. “I hired a software engineer and brought the software in-house to customize the machine and the graphics. I was confident that I could provide a service and value that protected the business owners and provided profits anywhere our products were placed.”
A partnership for a share in the profits
VapeTMs (a play on “ATMs”) are designed for club owners’ ease. In order to start receiving revenue, a club owner has to handle almost nothing themselves outside of reaching out to VapeTM. The vending company owns and operates their machines, from which they pay out a monthly revenue share to the establishment owners, similar to how a lot of ATMs are placed.
The placement agreement is negotiated based on factors such as the club’s location, volume and hours of operation. It’s primarily a turnkey placement, or “plug and play,” meaning that the club just needs to provide electricity, and VapeTM will plug in the machine, brand it to the club’s preferences, service as needed, stock and replenish the vapes based on local market sales, and then, at the end of the month, split the profits with the owner of the establishment.
Strip clubs face enough legal barriers as it is. My goal is to create an easy, legal and profitable addition to their business.
– Jordan Brown
“We handle everything: the excise taxes on nicotine, state sales taxes, vendor’s licensing, nicotine dealers license or tobacco or vape license, as required by state, and they would just get a check or direct deposit into their account,” Brown explains.
For club owners who want to be more hands-on, Brown adds that he does sell his machines for outright ownership.
“We could support that and give them a login, where they can manage the machine remotely and still purchase vapes from us,” he says. “But for the most part, what I’m seeing is that most of these establishments would rather have a turnkey program.”
According to Brown, there are over 25 states which support the ownership and operation of vape vending machines “without too much scrutiny or red tape.”
VapeTMs are equipped with age verification, and depending on the state, an application for facial recognition, as well. But in some states, local laws will require more involvement; for instance, clubs which have dancers under the age of 21 may need to have the machine “supervised.” Brown encourages club owners to reach out to him directly for any questions regarding their local legality.
“Strip clubs face enough legal barriers as it is,” he says. “My goal is to create an easy, legal and profitable addition to their business.”
Custom to your club
Most clubs that sell vapes already either have them in a machine which is not closely monitored or through an unregulated bathroom attendant, according to Brown.
“In both situations, there’s a high probability that they’re not selling the most popular, and therefore most profitable brands,” he says. “We function not only as a machine installer, operator and supply, but also as an expert in product selection and pricing optimization.”
VapeTM purchase vapes from registered distributors in the state in which they’re selling, with a selection customized to the club’s request and local market sales data, to ensure that their machines are only stocked with the highest quality and highest selling vapes.
“Whatever people are smoking, those are the vapes we’re going to put in the machine,” Brown states. “If some of the repeat customers are dancers, for instance, we can provide the owner a certain flavor or brand request.”
Each machine can hold 18 different brands or flavors. For optimal sales, the selection generally includes a variety such as mints and fruit flavors of premium vapes with a higher markup price. After the machine is installed, VapeTM continues to monitor its individual sales data to see what’s selling best in your specific club.
We handle everything: the excise taxes on nicotine, state sales taxes, vendors’ licensing, nicotine dealers license or tobacco or vape license, as required by state, and they would just get a deposit into their account.
– Jordan Brown
“We’re very hands on and nimble,” Brown continues. “And as we start to operate the machine in a new place, we will continue to collect data to make changes, ultimately creating a profile that’s unique for them.”
VapeTMs come in a few different models, such as a convenient wall-mount machine and a larger floor model, which has more capacity and features customizable LED lights.
The machines can also be branded to the club. On a 32-inch LCD touchscreen, which Brown describes as “very sexy and slick,” up to eight different banners, logos or phrases can be uploaded remotely. Brown encourages clubs interested in this highly competitive feature to reach out with artwork or images to see what’s available.
The details in the data
After installing vape dispense machines in establishments across the country, Brown’s data showed that many of his repeat customers were nighttime employees and clientele who craved nicotine after late-hours drinking. That’s how VapeTM first entered the adult nightclub industry, but it’s only the beginning of the relationship Brown intends to build.
“The strip club world, as I begin to know it, is a small community,” he says. “If I can establish myself, create a reputation and do a good job, I feel that it is an industry that we can grow in. With our machine, we can increase the size of the pie by providing more variety, selection and service, creating a win/win situation for myself and for club owners.”
VapeTM has shown their commitment to partnering with the industry through efforts such as joining ACE and sponsoring and attending this year’s ED EXPO.
“Joining ACE, which I was introduced to by my friend, Warren Cato of Club Control, seemed to me both a great way to express my care for and support of this industry, as well as to get involved,” says Brown. “I’m happy to participate in any way that I can add value.”
VapeTM commits to placing their machine at your establishment for free. The sleek and sexy machine can be branded with the client’s logo and advertisements. VapeTM will handle all of the licensing and taxes. They also service the machine, stock and replenish the vapes based on your local market data. All that club owners have to do to get a machine installed and start seeing a revenue share is reach out to discuss a placement agreement.
As a sponsor and attendee at this year’s ED EXPO, VapeTM will be bringing a few different machines stocked and able to dispense.
“At the EXPO, I’m hoping to gain both friends and business relationships,” Brown says. “I want to show club owners that we can increase their profitability with a service and a product that follows the law.”
For more information, call 888-537-8273, email jordan@vapetm.com or visit vapetm.com.
