Five Things To Consider Before Starting A Cannabis Business In 2018
In this rapidly growing cannabis industry, many businessmen and women are seeking to open their own unique cannabis business but unfortunately have failed in that regard. Here is a list of five things to consider before starting a cannabis business.
Underestimating the amount of start-up capital that is needed is a mistake many make. For a single location dispensary, you should be prepared to spend between 100,000 to 250,000 start to finish. This can vary depending on the cost of the real estate & how expensive your taste is trying to achieve the look and feel of the inside of your dispensary. Remember you can always enhance the look and spend extra on custom amenities after you’re opened for business. On the cultivation side, you can expect to pay at the minimum 700,000 for the smallest and simplest grow facilities. These can be achieved on this type of budget, but at this price point, you’re looking at a build that is often under 2000 square feet. What the average spend for a cannabis cultivation center are between 2-5 million dollars.
Be prepared to spend significant time studying your local market and learning about cannabis before trying to write your own application for a cannabis license to operate. These licenses vary in type and are mandatory for every legal cannabis business to have in place before you are allowed to run. Hiring a consulting firm with experience and success writing these will cost more than if you did it on your own. But their expertise will convey to the regulating bodies that you are not only aware of the laws that govern the industry, but that through the explanations required in the application, you’re able to spell out how you’ll follow these laws.
Make sure you speak to experienced cannabis construction professionals to determine the cost of the design and build out of your facilities before you apply for your license. Knowing these numbers can make or break your new cannabis company. Getting these numbers right the first time and understanding the timelines of construction are critical elements to keeping both your investors happy and remaining in compliance with deadlines set forth by the state you plan to operate in.
Never ignore the standard operating procedures no matter which type of cannabis company you plan to open. Even something as easy and straightforward as a cannabis delivery company can enjoy peace of mind and open communication through an adequately placed set of standard operating procedures specific the exact needs of that operation. These SOP’s have been developed through the trial and error of hundreds of cannabis companies and years of experience learning best practices. You have the opportunity to learn from the pioneers in this industry so that you don’t have to make the same mistakes they did. Take full advantage and find someone to develop these for you. You’ll be glad you did.
(5) Think Outside The Box
Using a cliched marketing and branding plan can sink your company before it even has a chance to start. At the beginning of the industry, it was understandable that new dispensaries faced the challenge of being identifiable to potential customers as a legal place to purchase cannabis. Having a green cross or cannabis plant as part of your insignia or logo was understandable then, but you will be left behind by the others who have chosen the improve their brands or start with a more sophisticated, target market specific approach. It can be tempted to follow the crowd but set yourself apart by investing the time and money upfront on a well thought out brand image you can be proud of.