Last updated on November 15th, 2019
People growing cannabis for business purposes tend to care about how much THC is in their final product. So, what is THC? Also called tetrahydrocannabinol, it is the chemical found in marijuana that causes psychological effects brought about by using cannabis. It has taken decades to get most states to legalize cannabis, and more countries are continuing to legalize it. Starting a cannabis business has become easier; you can even get cheap marijuana seeds to get started. However, there are a few things you should know before doing so. Keep reading to find out.
Basic Things You Need To Know When Starting A Cannabis Business
01. The Set Complex Rules And Regulations
Several states have allowed the use of cannabis for recreational purposes, but they all have some set regulations and laws that you must follow as a seller. Some states give out many licenses while some are very restrictive. For instance, they may need you to provide proof of a massive amount of capital. Having a criminal record can be a hindrance when considering a cannabis business plan.
Your best bet can be researching about the laws of your state not forgetting the county and city laws too. Doing so helps you determine whether you’re qualified to start a cannabis business and what other steps you need to follow to be on the safe side of the law.
You can also join an industry group or association like the NCIA (National Cannabis Industry Association). Another crucial thing to remember is talking to an attorney specializing in the cannabis market. Having a good attorney will help you stay updated on any legal changes as they arise.
02. The Niche To Specialize In
Finding your niche is a vital step to start marijuana business as it helps you stand out. There are also regulations that govern what you can, and can’t do within a certain niche; be it manufacturing, growing, or selling.
Here are some niches you can choose from:
This one can be a perfect choice for anyone with a green thumb. The cultivation niche allows you to experiment using different strains and also give them names according to how they smell, taste, affect, and many more. Cultivation is an area that’s highly regulated which means you need to make a substantial financial investment and also prove that you have enough horticultural knowledge for you to get a license.
Collective and dispensaries are the common names for retail stores that sell cannabis. However, that doesn’t mean that anyone can walk in these retail stores and buy cannabis. Customers are supposed to be above a given age and have a medical marijuana card. Business wise, this niche is very profitable.
Marijuana Infused Products Manufacturing
You can get cannabis inside food these days. These foods are known as marijuana edibles. One significant benefit of these edibles is that they can be consumed at any time, no matter the place.
Specializing in this niche can help you get a wide range of customers as there are people who need the intake of cannabis but don’t like smoking hence offering them an alternative.
However, you might face many challenges in this niche because you have to control the dosage of cannabis you use in these foods and also mask the marijuana to make it hard to detect directly.
This niche can be a great one for anyone who doesn’t want to sell, create, or grow cannabis. You can start an industry that indirectly works with people who are already in the cannabis market. Doing that can help you make a lot of money without facing the same risk they do. For instance, you can be a cannabis app developer or a cannabis attorney.
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03. The Types Of Cannabis Businesses
The critical decision when starting any business is deciding whether to start it all on your own, work with someone else, and make it a partnership or form a business entity like a corporation or LLC. When deciding on the business type, you have to consider some factors like the amount of capital needed, taxation, liabilities, and control. Besides, your cannabis logo should be designed in such a way that people cannot forget it easily.
Partnerships and sole proprietorships are cheaper to operate; but since you are the owner of the business, you’re personally liable to any obligations, liabilities, and debts that the company might be having.
A corporation or LLC is liable for the business shareholders, debts, and the members are not personally accountable. If you want to start a corporation, you will be needed to fulfill some regulations and also pay a specific fee. For affordable yet powerful logo design, you can use an online logo maker tool that lets you get one such logo in just 5 minutes.
04. How To Choose A Business Name
Coming up with a name for your Cannabis business is crucial as it determines the amount of success you get. Why? Your business name reflects what you offer, your brand, and also shows how unique you are from other cannabis businesses.
Here are some factors to remember to help you come up with the best business name:
i. The name should be memorable.
ii. It should represent what your business offers accurately and precisely.
iii. The name shouldn’t infringe any other current trademarks.
iv. The name should show the seriousness of your business.
05. How To Finance Your Cannabis Business
One of the significant factors to consider when starting a cannabis business is the amount of capital needed and where to get it. Even though you might get high-quality and cheap marijuana seeds easily. When a cannabis business idea comes up in your mind, first you need to get a license and pay a non-refundable fee which varies depending on the state.
Financial institutions like banks are usually tied to the government, which makes it hard to get funds from them to start a cannabis business. However, you can still get funds from specialized groups that invest in marijuana business, crowdfunding, incubators, and business accelerators.
06. How To Market Your Cannabis Business
Among the significant factors to consider when starting any business, is how to market it. One of the best and easiest ways to market your cannabis business is using social media. Social media helps you to market your marijuana business to a broader audience compared to any other marketing method.
Popular channels such as Facebook, Instagram, Twitter, and YouTube are the vital tools you should use to promote your business. Creating a dominant presence of your cannabis business on social media channels is critical as it’s an easy way to reach your customers. You need to engage your potential and existing customers with exciting and interactive content.
Make sure your website is professional looking and graphic design ideas are par excellence. Also, ensure that you post content regularly on your social media pages. Doing so helps you to stay relevant and prove the potential of your cannabis business to your prospects.
Besides, ensure you choose a cover photo for your social media pages that attract the attention of your visitors. Make sure you include some crucial elements of your brand, such as images, colors, and other essential things you want your business to display on social media.
07. How To Build Trust
When thinking of starting a cannabis business, establishing trust in one of the critical factors to consider as it helps to propel your business. Your customers need to see your cannabis business as a stable and legit venture. They, require you to ensure them that your business is not involved in any anti-social or illegal activity.
To build trust and establish brand identity, you need to make sure that you’re always available to answer their questions and explain more to them about how your business works. Ensure you are fully transparent about the terms that your business operates on. Also, tell them about the legal requirements your cannabis business has met. Doing that makes your customers trust you and your business more.
When talking to your potential customers, ensure that you give them your contact details and office details as it’s a crucial factor to win their trust. Even better, give them your official business card containing all the vital information about your cannabis business. Creating a unique business card can help you make your business stand out even more.
08. How To Change Your Marketing Plans
The cannabis business is prone to vary in market conditions. So, you need to know how to make adjustments to your marketing plans in case of any random changes in the market. You should be able to know when your marketing strategy isn’t performing as it should and changing some of the most crucial aspects of it to make it more effective. It’s also necessary to have marijuana logo that can easily convey a message that you’re into marijuana business.
You should be innovative in all your market approaches when dealing with varying market conditions. One of the best ways to evaluate and see if your current, marketing method requires some amendments is trying to get feedback from your customers. If your customers say they can see some faults or that they have a problem with a part of your approach, then you should make some changes.
The Bottom Line
Starting a cannabis business can be an easier process if you already know the above things and consider every needed requirement. The availability of cheap marijuana seeds also reduces the cost of starting a cannabis business hence helping you save some money to cater for other crucial necessities.