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Juul is exploring plans to open its own US retail shops

Key Points
  • E-cigarette maker Juul Labs is considering opening U.S. retail shops that would admit only adults, a person familiar with the situation tells CNBC on Thursday.
  • Should Juul go through with the plans, it will first open store doors in Texas, the person says.
  • No formal decision has yet been made, the person says.
A pedestrian walks by an advertisement for JUUL on the door of a smoke shop in New York.
Scott Mlyn | CNBC

E-cigarette maker Juul Labs is considering opening U.S. retail shops that would admit only adults, a person familiar with the situation told CNBC on Thursday.

Should Juul go through with the plans, it will first open store doors in Texas, the person said, cautioning that no formal decision has yet been made.

Juul also plans to open a store in South Korea, the person said.

The potential plans would give Juul more control over distribution of its products, as regulators have increased their scrutiny of underage sales. Regulators have blamed a teen vaping "epidemic" on Juul. Opening its own stores could allow Juul to monitor sales closely and test technology that could prevent minors from buying its products.

The potential U.S. store would not sell fruity flavored e-cigarettes, the person said. Instead, it will sell only tobacco, mint and menthol flavors. Juul, which introduced its vapes and fruity nicotine pods in 2015, has been criticized by outgoing Food and Drug Administration Commissioner Scott Gottlieb for offering products that he says cater to younger users.

The FDA in March proposed restricting where fruity flavors can be sold, limiting them to age-restricted stores such as vape shops.

Walmart said earlier this month it plans to stop selling fruit- and dessert-flavored e-cigarettes altogether as part of a plan to prevent minors from buying tobacco. It will also increase the minimum age to buy tobacco products to 21 starting July 1.

Juul has over the past year tried to overhaul its image and demonstrate it is a health-focused company that wants to "improve the lives of the world's one billion adult smokers by eliminating cigarettes," as its website claims.

The person requested anonymity because the information is confidential. Juul declined to comment. The Wall Street Journal reported Juul's retail plans earlier Thursday.