Marijuana use is far more prevalent in the United States as more and more states legalize it for medical use or recreational use. Because of this increased use of marijuana, many entrepreneurs may be looking to start their own company to tap into this market and see their passion turn into profitability.
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That being said, starting your own marijuana business can be substantially harder than launching any other type of business. If you have an interest in marijuana, here are a few tips on how to start a marijuana business in the U.S.
Create A business Plan And Speak With Established Industry Experts
Business planning is what sets a strong foundation for an upcoming business launch and helps you ensure that you’re working on a path towards growth. In the marijuana industry, planning is especially important, some of the main focus that you should have as you’re developing a business plan include:
- Navigating the Legality of THC: Tetrahydrocannabinol (THC) is still illegal according to federal law, but many states have come up with their own legal guidance regarding marijuana. If you want to keep your business operating, it’s important to do your due diligence to understand the laws regarding marijuana in your state (for example, a legal state like California) so you can acquire the proper licenses. This will allow you to grow and distribute without the concern that your operation will be shut down and you will be facing legal consequences.
- Coming Up With a Marketing Plan: Most marijuana companies don’t just rely on word of mouth. Figure out which marketing channels will be most effective in helping you stand out in the cannabis industry. As a new small business, you will likely want to create a plan for local marketing first, expanding your marketing strategies as you scale your business.
- Looking to the Future: No cannabis company focuses solely on one type of product. For example, even though you may initially cater to marijuana users, you may wish to expand to cannabidiol (CBD) later on. Use authoritative resources like American Marijuana to learn more about CBD and some of the top-rated CBD products (edibles, CBD oil, vapes, etc.) that you may wish to include in your store down the road. Even better, CBD is legal at the federal level, allowing you to tap into a national market!
The more planning you do, the better the chances of your business thriving once you finally do launch.
Understand The Challenges That Businesses In The Marijuana Industry Face
Launching your own cannabis business is by no means a walk in the park. Although marijuana is profitable, there are numerous challenges that business owners face when they do decide to start their own company.
Just a few of these include a lack of banking made available to marijuana businesses (resulting in increased security expenses), issues growing in the face of mega-companies that are already dominating the market, and the fact that rules and regulations are always changing. Dive into some of the challenges that other businesses have faced to prepare yourself for the road ahead.
Know Where You’re Going To Secure Funding Before You Take The First Step
Unless you have the ability to fund your business on your own, you’re going to rely on investment support from somewhere. That being said, securing traditional investors and traditional loans can be hard because of the industry that you’re operating in. Instead, you’re going to have to get creative to find funding and ensure that the money you do have is going to good use.
Starting a marijuana company can be costly, so it’s best to create a budget beforehand, create a list of resources where you can secure funding, and aggressively target these resources to keep your business running optimally.
Starting your own cannabis business can be a great way to make money if you’re passionate about marijuana. However, passion alone is never enough to start a thriving business. If a business is in the cards for you, use the guide above to dive into some of the most important aspects of starting your own small cannabis company!