No business can survive without a business plan. Nowhere is that truer than in the cannabis industry. Developing a cannabis business plan is one of the savviest steps you can take. Despite the low competition in states first initializing legislation, there remains significant legal, cultural, and economic hurdles to combat.
It’s not hard to see the attraction. According to New Frontier Data, the cannabis industry will hit $51 billion globally in 2025. Tens of thousands of jobs are being created – and numerous cannabis millionaires are now living the good life. Doesn’t everyone want a slice of the pie?
If you’re planning on establishing a cannabis company, there has never been a better time. The financial support exists and is growing – and the market is booming. The only question is, what’s your cannabis business plan (or, more specifically, your dispensary business plan)?
With ever more entrepreneurs opening dispensaries and other cannabis-related businesses, planning ahead can help avoid obvious mistakes. It’ll save you a lot of headaches going forward.
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Below we’ll explore the key elements to include in your cannabis business plan. Whether you’re developing a large-scale manufacturing or small-scale dispensary business plan, answering these questions will help you create a solid plan.
Your customer base will inform almost every other decision you make. If you’re creating a dispensary business plan, it’ll determine the name, location, and product selection.
There are two ways to decide on your target market:
No business exists without funding. When you’re developing a dispensary business plan, knowing how you’re going to rent the premises, buy stock, and hire staff is of paramount importance. Without money, you don’t have a business.
Cannabis companies can struggle to get funding because big banks refuse to touch them. (Cannabis remains illegal at the federal level, leading to complicated financial rules.) Nevertheless, there is a growing array of funding options available.
It should be stressed – you cannot access traditional funding forms. Nor should you lie to banks about the purpose of your funding. Remortgaging or using credit cards can get you into severe trouble if done under false pretenses
In time, you’ll also have access to loans from cannabis financial institutions such as Safe Harbor. Try to avoid the shadier financial institutions as they typically lack the expertise and experience to adequately handle a cannabis-related business’s legal aspects.
Getting your marijuana retail license is critical for any dispensary business plan. In fact, like funding, without a marijuana license, there is no business.
You should be aware of the potential difficulties. For example, suppose either yourself or your spouse has a criminal record. In that case, it can significantly impede your chances of being granted a license in certain states.
Anyone who has run a business knows you succeed or fail based on your operational strategy. Everyone else has never heard of the term.
It involves the hiring and managing of employees, obtaining materials and working with suppliers, and how you sell your products to customers.
Your operational strategy is the beating heart of your cannabis business plan. It’s not glamorous, it’s not glitzy, but it is the nuts and bolts of any business.
While writing SOPs is a little over the top for a business plan, you should have a clear idea of your procedures. Your operational strategy should always work in tandem with your business strategy.
Marketing is more than paid advertisements. It involves some fundamental decisions about your business. Think about which products you’re going to stock and where your premises will be based.
In addition: how are you going to get the word out? Will you rely on traditional advertising? Or will you develop an SEO and social media strategy to win over your clients?
Remember the 4Ps of marketing: product, price, place, promotion.
Answering these questions will solidify your cannabis business plan. The only thing left to do is get started.
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