The cannabis industry is growing, and many entrepreneurs around the world are scrambling to get their piece of the green pie. However, many can get stuck in a rut if they don’t pay attention to how the industry continues to develop and change around the world. Keep your eyes and ears open, and you won’t fall into that furrow. Here are 8 considerations that can help you stay on top of any developments and keep your startup profitable:
1. Corporations Will Enter the Fray
For the most part, the cannabis industry is ruled by small businesses and startups. As cannabis becomes more and more accepted, that will change. Big pharmaceutical corporations will make their moves, and back those moves with enormous amounts of capital. Your startup needs to be prepared to fend off that attack, which is best done by securing your target market as soon as possible.
2. Cannabis Will Become More Widely Accepted
The best consideration you can make is the idea that cannabis will become more wildly accepted. While some stigma will always remain, the fact is more and more people are becoming informed and okay with marijuana usage, both recreationally and for health reasons. That means the market you’re looking at will likely grow as time goes on. If you want to get the most out of it, you have to take that growth into account as you plan your startup’s systems and scaling.
3. Dealing with Banks Will Get Easier
Traditionally, fundraising for cannabis entrepreneurs has been difficult. Startups are largely reliant on investors to raise capital, as banks have been steadfast in passing on cannabis business loans since 2018. However, things are set to change. As products in the industry become more accepted, socially and legally, banks will become more willing to lend money to entrepreneurs running related startups.
4. Buyouts Will Become More Rampant
For many entrepreneurs, the exit plan is to sell the startup once it’s viable and profitable. The good news for you is that selling a great cannabis startup will become a lot easier. Large companies who want in on the industry may decide that creating something from scratch is not for them and elect to purchase an existing business. This jumpstarts their entry, as they’ll not only acquire the systems present in the company, but the clients as well.
5. Cannabis Products Will Pop Up in Existing Stores
Large corporations won’t always need to put up new stores or brands to get their piece of the green pie. If they have an appropriate store, they can just start manufacturing their own cannabis or CBD products. For example, companies that sell drinks can offer CBD infused versions of their existing products. For entrepreneurs such as yourself, this can be a tremendous hurdle, as you may find yourself fighting against a massive corporation that’s backed by a beloved brand.
6. Scrutiny Levels Will Rise
The more mainstream cannabis becomes, the more people will purchase your products. While that’s obviously grand for your startup, you also need to be prepared for the scrutiny that will come with constant use—this scrutiny will go beyond just the quality of your product. Customers will want to know everything about your startup, and you’ll need to make sure your company is ready for that level of transparency.
7. Various Methods of Consumption Will Become More Popular
For many people, cannabis consumption is represented solely by smoke inhalation. However, as information grows more widespread, people will find that there are plenty of ways to consume, from drinks to delicious foods. When constructing your startup, you must consider whether or not to offer a variety of cannabis consumption options, or to focus on a singular type of product.
8. Research and Knowledge Will Spike
The more people and companies are interested in an industry or topic, the more research is done. As the cannabis industry gains momentum, information and knowledge on the herb will grow and spread. This is good for your startup, as a well-informed and understanding market is required for it to succeed. However, this also means that you’ll need to stay informed as to the changes this knowledge will bring. Laws on manufacturing or growth, for example, may shift as more research is done, and you’ll need to make sure that your startup adheres to these changes in requirements.
Running a cannabis startup can be a profitable endeavor for you as an entrepreneur, but it remains a young industry, one that’s still subject to numerous quick developments. Stay on top of these developments, and you’ll secure your startup’s bright future.