The cannabis industry continues to thrive with the introduction of dispensaries, edibles, lifestyle brands, restaurants and more. However, there are still many opportunities that have not been tapped that can allow you to start and grow a successful cannabis business.
With that said, starting, and growing a successful cannabis business is not easy. You have to contend with contradicting laws and regulations, taxes, among other roadblocks. With sales projected to reach at least $20.2 billion by 2021, it is necessary that you get the foundation of your cannabis business right to be successful.
In this article, we will look at tips from successful cannabis entrepreneurs on how to start and grow a cannabis business. With the tips below, you will be able to avoid the pitfalls that plague many start-up cannabis businesses.
Create Solutions for Existing Needs
If you look at successful businesses you know of today, they have provided a solution to pressing needs. First off, you need to decide on which cannabis sector you will go into. You need to be unique and avoid the typical go-to’s such as dispensaries or grow operations.There are many other options that you can choose for your cannabis business. This includes everything from professional training, hydroponics, CBD oils, media companies, consultancy, education, cultivation products and so much more.
Despite the wave of cannabis legalization, you need to ensure that your business idea is legally viable and that you are offering a unique solution. For long-term success, your cannabis business needs to navigate legal barriers in this fast-changing industry.
Identify and Understand Your Customers
Armed with your idea, you need to do a market study to identify and understand potential customers. The legal cannabis industry is becoming crowded, and it is necessary that businesses start doing targeted customer marketing.
The success of a cannabis business is closely tied to how well you understand your customers. You will need to build authentic relations with your customers and create a plan on how you will meet their long term goals.
Know the Rules and Follow Them
You might have a glowing business plan and customers who cannot get enough of your products, but if you fail to follow the rules of your particular state or jurisdiction you are sure to attract hefty fines, business closure or at worst jail time. Unfortunately, the laws governing the opening of cannabis businesses are complicated and confusing, as they differ widely from state to state.
Due to these complications, you will need an experienced legal representative who is well versed in cannabis law and regulations. Disregarding set cannabis laws and regulations will stifle your growth and might affect your business.
Carry Out Competitor Research
Identifying your competitors is a crucial aspect of growing a business. Their businesses will provide you with a blue print on how to run a cannabis business and an opportunity to analyse the strategies that work.
Raise Enough Funding
Investment capital is vital for the growth of a business. Since the cannabis business is still illegal under federal law, banks, and other traditional financing options are skeptical about investing in cannabis businesses.
While it is true some investors are wary of entering the cannabis market, many other savvy investors are looking to cash in on one of the fastest growing business today. With that said, you need an investor who will bring experience and expertise from their industries to help you grow your cannabis business.
Resources and Networking
While there is much growth expected in the cannabis business sector, your best friends in the industry will eventually end up being your competitors. With that said, this could be a good way for you to start and grow your cannabis business.
In time, you will have a healthy circle of support and advice. Moreover, the cannabis business is still in its grassroots stage, which means it is a community-oriented industry. Whenever possible, be on the lookout for opportunities to reach out to other cannabis entrepreneurs in your area and see if you have a viable business plan.
For instance, you could network with other cannabis entrepreneurs in the National Organisation for the reform of Marijuana laws. They have several chapters around the country, and this presents some of the best networking opportunities with other stakeholders in the cannabis industry.
One of the greatest challenges you will get when starting your cannabis business is funding. However, networking with other cannabis entrepreneurs who came before you will set you up for long-term success. If you find these tips helpful (or would like to add some of your own), please leave us a comment in the comments section!
Sam Hoffman is a business and marketing consultant who helps digital businesses reach their exact audience. Sam is passionate about optimization and analytics. His current focus is helping decision-makers design their perfect business tools. He frequently writes about the latest advancements in the digital marketing industry.