The cannabis industry has quickly evolved into a booming business sector with many different types of businesses and products out there. So, it’s no surprise that so many people are looking for their chance to break into this competitive industry. However, despite how quickly the cannabis industry has grown, it’s still a fledgling industry that many business owners are trying to become acclimated with as it continues to grow.
If you’re looking to make a name for yourself in the cannabis industry, you’ll need to know a few things before you dive straight into it. So, today, we’ll explore some things you need to know if you want to start your cannabis business.
You’ll need to decide what kind of cannabis business you want.
In most cases, the first step to starting any business is to develop a business idea. However, since you’re already planning on a cannabis business, you need to decide what part of the cannabis industry you want to work in. For example, do you want to open a marijuana dispensary, get into marijuana cultivation, or perhaps do something in distribution? We’ll focus on a dispensary for this scenario, as it’s one of the most popular cannabis businesses available.
Many other steps for starting your dispensary will follow a similar pattern to starting any business. However, as a dispensary, you’ll also need to decide what range of products you’ll offer, such as only marijuana products, cannabidiol (CBD), delta-8 tetrahydrocannabinol (THC), or a combination of all of them. Delta-8 products are becoming almost as popular as traditional marijuana products. Delta-8 THC differs significantly from the federally illegal delta-9 THC. Delta-8 is naturally occurring in cannabis and still produces the psychoactive effects that delta-9 is most popular for producing. However, delta-8 takes longer to take effect, as it metabolizes into delta-9 in your body and causes what many consumers refer to as a “clearer high.” In fact, delta-8 products have gained enough popularity to come in many various products, such as 500mg delta 8 gummies, vape juice, flower, and more. Once you know what you want to sell, you can move into the more common aspects of starting a business.
Ensure you handle the legalities properly.
Every state has different laws about marijuana businesses. As a result, they each have varying business licenses, permits, and registrations for starting a marijuana business. So, you’ll need to check with your local state and municipality to ensure you’re within the required guidelines and regulations to start your business. Additionally, the taxes on your marijuana business will vary from state to state. No matter where you’re located, you’ll still need to register your business to pay taxes, meaning you should apply for an employer identification number (EID), also referred to as a business tax ID number.
Finally, insurance is another crucial step in handling any legalities around your new business. As a cannabis business, it would be best to look into cannabis insurance solutions explicitly geared toward your chosen industry. These companies offer insurance policies for cannabis businesses of all types and sizes with coverage for numerous hazards, including vandalism, theft, fires, and natural disasters.
Don’t forget the start-up costs.
No matter what industry you enter to start a company, you’ll face start-up costs. However, marijuana businesses typically deal with more expenses than conventional businesses. If you can’t cover these costs out of pocket, you’ll need to secure financing. For example, as a dispensary, you’ll need to purchase licenses to sell cannabis. Usually, the application fee for selling cannabis is roughly $5,000. However, this cost varies from state to state, such as Louisiana, where it’s only $150, or New Jersey, where it’s $20,000. So, you may need to secure a small business loan or alternative loan specifically for marijuana businesses.
Open your business and start selling your products.
Once you’ve managed all of the above steps, you’re ready to start the opening process. Just remember to ensure you comply with all legalities before you open.