5 Tips for Cannabis Business Startups
Cannabis is a hot topic right now, and with legalization happening in more states every year, there’s never been a better time to start your own cannabis business. That said, it can seem like an overwhelming prospect for someone who has no experience in the industry. If you are an entrepreneur who is looking to start a new cannabis business, there are many things that you will need to know before jumping in.
Making the leap to become a cannabis business start-up can be daunting, but with these five tips, you’ll have a much smoother process. We’re going to cover everything from choosing your state or country that has legalized medical marijuana, getting the appropriate licenses needed for your type of business, and more. Let’s get started…
Check legal requirements
The cannabis industry is controlled by strict regulations, and its legality differs from state to state. Although the medicinal use of cannabis is legal in 36 states, recreational use is still considered illegal on a federal level, except for CBD products which are strictly regulated by the control of THC levels in the product. Starting up a dispensary requires a license, and the number of licenses that you need will be determined by the size of your operation. We cannot stress the importance of reviewing the regulations in your state with a fine-toothed comb before you take any other steps.
Will you grow, distribute, or sell cannabis products?
Again, knowing the legal requirements and restrictions is crucial. There are several different doors through which you can enter the industry, each with its own laws, and each one can be profitable. The most common sector, however, still proves to be cannabis dispensaries, but this doesn’t mean that it is the sector that you have to take part in.
Create an online store
Once you’ve determined the sector that best suits your business, and all your ducks are in a row, your business is ready to take off. We live in a digital age that opens opportunities for every business to reach potential clients on a global scale. Getting your brand noticed is central to your success, and creating an online store is the key to improving awareness.
Marijuana consumers want to find the best deals and get the most out of their dollars. Online headshops like Grasscity are offering everything from bongs to vaporizers that are available for purchase, and they are usually the first place people turn to when they need cannabis-related products and devices. Following their example will help you develop a great and efficient business strategy.
Advertising in the cannabis industry can be tricky, but using social media platforms that provide links to your online store is crucial to pushing up your bottom line. Your online store must be visually appealing, with clarity, and easy to navigate. And don’t forget to update it regularly or you may find yourself in hot water.
Research your industry
In every industry, the biggest market players keep a constant eye on their competitors. It is no different in the cannabis industry. Look at what players in the industry are doing. From it, you can learn where successes lie, what to avoid, and how your business can fit into the industry in a unique way that causes you to stand out. Aim for something unique, something that will set you apart and pique interest and curiosity.
Determine a realistic start-up budget
We’ve already determined that the cannabis industry is unlike any other, and this ultimately means the probability of even higher start-up costs if you’re wanting to be seen as a legal competitor. From the get-go, the licenses alone can cost a pretty dollar, and you will need sufficient cash reserves to make the process run as smoothly as possible. If you’re aiming to enlist the help of investors, you need a strong business plan with clear financial objectives that are driven by fact and not the anecdotal data that is so readily available. Be picky when it comes to potential investors, and never give out more information than you should until the deal is done. Good investors are hard to come by, and once you manage to secure these, keep them constantly informed.
There is no doubt that entering the cannabis market is more difficult than any other industry. However, with great risks come great rewards. The industry is only projected to continue its growth, and, as the herb is legalized in more states and countries, the opportunity is ripe for the picking right now. Why wait when you can capitalize before the market becomes oversaturated?