The marijuana industry has expressed promising signs of growth in recent years. In 2020 alone, marijuana sales peaked at a whopping $20 billion. That’s not all. With a growth potential of between 20% to 30% each year, that ceiling is set to rise to $50 billion over the next four years.
That means operating successfully in this billion-dollar industry will demand you stay ahead of the emerging trends to fully maximize your profits. You can outsmart the competition by focusing on several crucial aspects.
1. It all starts with a unique idea
Armed with a unique idea in the vast marijuana industry, you can easily identify and seek to fulfill an unmet need. That might just be your trigger to success in the business.
Do you want to specialize in the dispensary sector or growing operations? Narrowing down your options will give you a solid starting point. As the industry gains more legitimacy, the dispensary and grow-ops sectors might suffer a huge blow in terms of price fluctuations.
In that case, you might want to lean more toward the edibles marijuana line or the line of marijuana-infused personal care products.
2. Packaging is key
Quality packaging is important for it prevents your product from spoiling, maintains your outlet’s professional appeal to customers, as well as helps you stay compliant with local regulations and standards.
What’s more, if you choose to sell or provide pre-roll tubes, you get some space for information and custom advertising on the packaging.
3. Know your customer base
If you want to maximize your marijuana sales in line with the industry prospects, know your target customers’ specific wants and needs. How do they like their packaging? How do they ingest marijuana? What is their cultural inclination?
While at it, take note that millennials happen to be pioneers of recreational marijuana and therefore the major contributors to the growth of this leading industry. You might want to tailor your products to their needs.
4. Master the rules of the game
While you may be fully armed with all the funding, best packaging, and dynamic customer base, failure to play by industry rules might cost you your business before it sees the light of day. You not only risk shutting the business down but also incurring hefty fines and even landing a jail sentence.
Each state has its own set of regulations governing licenses, permits, and marijuana business planning. Ensure you learn them and track any changes to the fine print.
5. Funding is not easy to come by
The subject of marijuana remains controversial in many respects. Under federal law, it is still considered illegal. This fact may hinder your efforts to raise startup or expansion capital especially from banks and other wary investors. Yet obtaining a dispensary license is not at all cheap. For most states, you need to possess at least $1 million in available cash.
If so, then look for private investors particularly excited about the fast pace at which the industry is gaining traction. They usually want a piece of the action and might help in getting your business plan off the ground.
In conclusion, beware also that no bank will agree to safely store your marijuana proceeds for you. You are therefore left staring at the risk of keeping your earnings in cold hard cash!