Contact your health department to learn about the tobacco regulations and taxes in your county. Before you can obtain a tobacco license, you will need to select a business entity and find a location for your smoke shop. Once you've selected a location and registered your business, apply for your license and pay the annual fee.

Select a model for your smoke shop based on the needs of customers in your area. Hookah lounges are popular among college students. A good hookah bar will offer a variety of shisha, hookahs, snacks and beverages, as well as entertainment such as video game systems or belly dancing. Cigar lounges appeal to an older audience and should provide a variety of quality cigars and a relaxing atmosphere.

Experiment with the products you intend to sell. Hookah smokers are particular about the type of shisha and how well it burns. Cigar smokers may want machine-made or handmade cigars in a variety of strengths. Premium handmade cigars require humidors to maintain the right level of humidity and prevent the cigars from drying out. Become knowledgeable about popular types of loose tobacco and specialty cigarettes. Visit tobacco trade shows to get the latest industry news and try out different products.

Select a location for your smoke shop. Design your smoke shop to accommodate your clientele. Include entertainment such as a television, music, poker room or video game console.

Purchase furniture, humidors, fixtures, shelves, a cash wrap and display cases. Purchase tobacco, cigars, smoking instruments, premium cigarettes, as well as lighters, cigar cutters, rolling papers, pipes and flasks.

Find tobacco distributors.

Hire responsible employees over the age of 18 that you can trust to I.D. each client. There are heavy fines and strict repercussions for failing to I.D. tobacco consumers. Be sure your employees understand the severity of working in your smoke shop.