How to start a hookah business

Updated March 23, 2017

Hookah, which has been popular in the Middle East for more than 1000 years, has only recently gained popularity in the United States. In the past few years, hookah lounges have popped up all over the country, usually in or around college towns. Similar to coffee shops, these trendy lounges are a hit with young people. Starting a hookah lounge could prove lucrative, but it won't be cheap. Start-up costs start at about £65,000.

Contact your local government about the smoking ordinances in your county. Many states no longer allow indoor smoking. You may be required to adjust your approach in order to obtain approval. Once approved, contact your liquor authority to obtain a liquor license if you intend to sell alcohol in your hookah lounge.

Experiment with hookahs and shisha to find the best flavour and burn. Using smaller pieces of coal makes for a slower, more even burn. Good charcoal won't mask the flavour of the shisha. You'll want to experiment with a variety of hoses to see how each one draws. Try mixing shisha flavours and offering a variety of flavours. Find premium shisha, which will have more flavour and burn longer.

Find a location near a college or university, as hookah lounges are popular with young people.

Purchase hookah and shisha supplies: tongs, bowls, covers, hoses, coals, shisha, hookahs, as well as refrigerators, stainless steel prep tables and coolers (if serving food and beverages). Visit for detailed descriptions of different types of shisha and hookahs.

Design your hookah lounge business. Purchase couches, booths, tables, bar stools and chairs for your hookah lounge. Find cheap, used furniture at thrift stores. Check notice boards at colleges for graduates who no longer need their furniture. Contact restaurants that are going out of business or frequent restaurant auctions. Contact local artists about decorating your lounge with their work. It's free decor and extra advertising, since your artist will also direct traffic to your lounge.

Determine what to include in your hookah lounge. You may offer food and drinks such as espresso, food, smoothies and energy drinks. Offer inexpensive entertainment such as live music, a DJ, open-mic nights, belly dancers, poker or video games.

Hire responsible employees who have experience working in an environment in which I.D. checks are required. Patrons must be at least 18 years old to enter your hookah lounge, or 21 if serving alcohol. You will need to ensure that your employees understand how important it is to check each and every I.D.


Purchase liability insurance. Consult with a business lawyer. Hire an accountant to help get your books in order and learn of your tax liability.

Things You'll Need

  • Liability insurance
  • Sales tax permit
  • City approval
  • Liquor license
  • Food handler's permit
  • Location
  • Hookahs
  • Shisha
  • Furniture
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About the Author

Shanika Chapman has been writing business-related articles since 2009. She holds a Bachelor of Science in social science from the University of Maryland University College. Chapman also served for four years in the Air Force and has run a successful business since 2008.