Starting and running marijuana business can be a hard nut to crack. However, a quick check on marijuana business pros and cons can get you started with this golden plant.
Can-a-Biz or Can’t-a-Biz?
Still on the fence about joining the circle? Let’s look at a few marijuana business pros and cons.
Undying Commitment and Readiness to this endeavor? Ummmm…
Chances are you’ve thought about this already. You wouldn’t be reading this unless you didn’t go through some sort of first step towards a direction. But whether you think this is going to be a walk in the park or a walk across burning hot coals, it’s always best to make a list of things to consider from each side.
CANnabis: Marijuana Business Pros
Look, let’s not dance around this. You can call it the shallowest, dumbest, most immature reason for getting into the marijuana business, but ask yourself this: would you rather sell weed or sell mops?
It practically advertises itself! Bob Marley, Bob Dylan, Willie Nelson, Snoop Dogg, Dave Chapelle, Cheech and Chong, Seth Rogen, Woody Harrelson, Steve Jobs, Elon-fricking-Musk, and many, MANY more. Name an industry and I’m pretty sure that some of the biggest icons in that industry have advocated cannabis in some form or another.
As opposed to Mr. I-Won-Awards-on-something-you-probably-didn’t-know-existed-and-was-a-guest-on-some-show-noone-watched advertising the Maxi-Mop 5000.
But wait, there’s more…
It’s BIG Business
Revenues on marijuana sales in the US alone have reached the total revenue for Taco Bell this year and expected to overtake revenue from the NFL next year. That’s fifteen BILLION dollars by 2020 and the growth has almost doubled annually since en masse legalization-a trend expected to continue if supply is able to keep up with the large demand.
You’re in this to make the big bucks, right?
It’s Something You (Probably) Use Yourself
Okay, this is admittedly just an assumption. You know that saying “If you love what you do, you’ll never work a day in your life?”
That’s BS. Work is work. But consider this: Supposing – just supposing – that you’re a weed enthusiast, rolling a HANDPICKED QUALITY big fat one after 5PM is a comforting thought, isn’t it?
And if you’re not one: being with co-workers who are happy should minimize workplace stress, right? It should at least make for interesting office parties.
If that’s not a marijuana business pro, I don’t know what is.
It Still Has Large Untapped Product Potential
That revenue we talked about? That’s mostly just from straight recreational and medical use. Being a new industry, there are still as-of-yet undiscovered uses for marijuana that further research and creativity will help bring out (I keep telling people HASHNEYLAND NEEDS TO HAPPEN!).
Seriously though, the prior status quo of marijuana has hampered extensive research and development into its scientific benefits. The current wave towards full legalization provides better supply and incentives towards breakthroughs just waiting to be discovered.
It’s Well Liked
You’re in pretty good company. Current laws are largely restrictive, but there is veritable tidal wave in favor of changing that. The Pew Research Center has released a statistic that most Americans (2 out of 3) support marijuana legalization. Public fears on its health effects are largely diminishing with support for cannabis legislation doubling since the 2000’s. In fact, a house committee has recently just approved a bill decriminalizing cannabis on a federal level and is expected to clear the full House.
You’re not Selling Candy: Marijuana Business Cons
While marijuana dispensary first timers will often describe the experience as like stepping into a candy-store, the business aspect of it is anything but.
You know all those celebrities we mentioned earlier? Almost none of them can specifically advertise your business effectively. Under the Canadian Cannabis Act: it is prohibited to promote cannabis or a cannabis accessory or any service related to cannabis. While some states in the US (where cannabis is legal) allow forms of advertisement, you’ll find they are no less restrictive. Examples : Georgia flat out prohibits it and California says that they “can only be displayed where at least 71.6% of the audience is expected to be over the age of 21 and not within 1000 feet of daycare centers, schools, playgrounds or youth centers”.
Forget about rebel marketing as well because Facebook, Instagram, Twitter and Google have all openly stated that they will not be featuring any marijuana-related advertisements.
High Entry Cost
You can read about the small business challenges here. But the short of it is, between high application and license fees and high taxes (as much as 45% in some California jurisdictions), you’re going to be needing a pretty high business capital to get this started and running.
Oh, and there’s your equipment cost, too. What, did you think production cost was just a bunch of nets, LED lights and tea bags? Legal marijuana means health regulations, surprise inspections and hygiene checks.
And you can pretty much count your traditional capital generators out. Despite legislature allowing banks to work with cannabis companies, rare will be the bank manager who’ll give you the time of day because…
You’re (probably) a Slacker!
Again, admittedly an assumption. The wrong kind. Who would banks most likely want to work with: a weed-seller or a mop-seller? It’ll be a long time before weed sheds its traditional pothead imagery.
Until Marijuana is uniformly legalized across all 50 states, the US cannabis market will continue to be limited and unsure. Laws are still in flux and your 40 application requirements could may well be 40,000 next year.
Even with the wave of support towards the goal of legalization, there is considerable opposition rushing to meet it.
The Bottom Line
So you’re probably no less confused now than when you first started this right? Let’s remedy that. While the lack of advertising is indeed a challenge, a good product speaks for itself. The demand is large and as long as your QUALITY is up to snuff, people will come. And while you can’t currently rely on banks to finance your starting capital, there are a number of alternative methods to get you started. The future is bright because last we checked, we’re living in a democracy: governments should serve the people, not the other way around, and the major sentiment towards marijuana is positive.
End of the day, you’re in this to establish a business and make money off a booming industry. You can’t get something for nothing. And who knows? Maybe it’s your work ethic that finally breaks that pothead image mold.