With the cannabis industry growing at record numbers, it’s never been a better time to invest in this market. Even better, cannabis is a growing industry (pun intended) because plenty of states still haven’t legalized it fully. So, as legalization continues its slow march across the country, more people will start to partake in this plant’s benefits.
That said, while there is plenty of demand for marijuana buds and products, how can you enter the market and become a successful “weedtrepreneur?’ This article will be an essential guide to help you understand what it takes and how to ensure long-term success. Let’s begin.
Step One: Start With the Basics
If you’re going to make money in any industry, you need to know as much about it as possible. So, if you’re not really interested in cannabis (either smoking or consuming), you’ll find it harder to make it in this business. While it’s not impossible to thrive without knowing cannabis’ effects, there’s no reason to start a company without some essential understanding of the industry.
There are two components to pay attention to – the biology of the cannabis plant and the rules and regulations of the industry. Here are some points to consider when doing your research.
Growing marijuana is a pretty straightforward process, but there are some essential components to understand, including:
- Male and Female Plants – Cannabis is dioecious, meaning it needs males and females to produce fertilized seeds. In a growing operation, you only want female plants since they make buds. However, if you want to grow your own strains, you’ll need both. Breeding cannabis is pretty tricky and time-consuming but can yield some unique strains.
- Indoor vs. Outdoor Growing – Some areas are suitable for growing cannabis (i.e., northern California), but you can only grow crops once per year. Indoor grow operations require more funds upfront, but you can grow crops all year round.
- Soil vs. Hydroponics – Hydroponic growing offers better control and faster cultivation, but it’s expensive and comes with some risks. Soil growth is easier to master but takes a bit longer. Most growers prefer soil, but high-end operations may pick hydroponics.
Since cannabis is still illegal at the federal level, each state sets its own rules and regulations. For example, marijuana is fully unlawful in some states, while others may allow medicinal cannabis. There’s also a difference between full legalization and decriminalization. In the latter situation, police and prosecutors won’t go after users, but they will still prohibit dispensaries and dealers.
Overall, it’s best to start your operation in a state with full legalization. However, keep in mind that registration, licensing, and zoning laws vary by state and county, so the approval process can be lengthy can complicated. You should review local laws and consult a cannabis attorney before starting any business.
Step Two: Plan for Now and the Future
As it stands in 2022, cannabis is only legal state-by-state. So, if you were planning to expand your operations across state lines, you can’t transport materials or supplies from one location to the other. Because interstate travel is federally governed, you could face serious charges.
That said, it seems like federal legalization will happen relatively soon, so it’s good to plan your long-term business model accordingly. Also, you may find that some states are more accommodating to weed businesses than others. In that case, you can weigh the pros and cons of moving to a better location to start your dispensary or grow operation.
Step Three: Pick Your Avenue
The cannabis industry involves far more than just dispensaries selling buds to consumers. There are many ways to make money from marijuana, so you must figure out which option works best for your needs. Here’s a breakdown of the different avenues available.
THC vs. CBD
While cannabis is illegal at the federal level, hemp is not. By law, hemp must contain 0.03 percent THC or less. As a result, CBD products have flooded the market, thanks to recent studies illustrating the various health benefits of this cannabinoid.
So, if you’re worried about running into legal hurdles, selling CBD products is a safer bet than selling buds. However, because THC is what gets users high, it’s often in higher demand (no pun intended). Overall, you can make a lot of money either way, but CBD has fewer obstacles to overcome.
Growing vs. Selling
Growing your own cannabis gives you more control over your products, but the process is time-consuming and expensive. Alternatively, you can partner with growers to get high-quality buds to sell to your customers. Also, keep in mind that you may need to expand your operation as you grow your business. So, you might be able to produce enough cannabis in an office building today, but you may need a massive warehouse tomorrow.
Buds vs. Edibles
Cannabis buds are the most common way to sell the plant. However, many users prefer to ingest their weed via edibles. Common edible products include pastries, candies, and THC-infused butter. The added benefit of selling edibles is that you can appeal to newer users and sell the products without THC as an added revenue stream. Many dispensaries will also sell both, especially edibles with a long shelf life.
Regardless of the route you want to take, you can also sell various paraphernalia and equipment to your customers. Examples include bongs, vape pens, grinders, storage jars, lighters, and many more. Also, remember that those who smoke weed also get the munchies, so it may make sense to offer snacks and other treats. This way, your customers can take care of both tasks at once.
Step Four: Develop a Brand and Market It
One challenge of entering the cannabis business is that there’s a lot of competition. That said, because the industry is so new to so many states, there aren’t too many well-established brands. So, users don’t necessarily prefer one brand over the other because there’s not as much recognition across the industry.
So, to stand out, you need to create a stable brand and market it as much as possible. While you’re in control over your branding process, some elements to include are:
- Professional – Gone are the days of buying weed from a corner dealer. Instead, many consumers want to purchase from reputable suppliers.
- Legal – If your brand implies that your weed is still illicit, you may attract attention from local law enforcement. Instead, you want to present yourself as above board at all times.
- Experienced – You’ll likely be marketing to both veteran cannabis users and newbies. Either way, you want to highlight how much you know about the plant and the strains you’re selling. If you seem out of your depth, how can your customers trust your recommendations?
Step Five: Build Strong Relationships
As with any other industry, success is creating a stable network of suppliers and customers. Once you establish your brand, you’ll need to build relationships with various people within the industry. Some examples can include:
- Seed Banks – If you’re planning to grow weed, you need high-quality seeds to ensure consistency and stability. Seed banks can keep your operation in good standing.
- Regulators – While you don’t want to seem like you’re in a quid pro quo relationship, having an amicable understanding with inspectors and other regulatory bodies makes sense.
- Growers – Even if you grow your own marijuana, you can supplement your stock with buds from other growers. Strong relationships with these operations ensure you get access to the best products before other dispensaries do.
The Bottom Line
Becoming a successful weedtreprenuer means doing your homework and following the proper steps forward. Now that you know what to expect, you can conduct more research and start turning your business idea into a reality!