The legal marijuana industry grew to $10.4 billion in 2018 in the United States and employs more than 250,000 people, according to research firm New Frontier Data. With the cannabis industry booming and changing constantly, it may seem overwhelming and deterring if you’re thinking of breaking into the industry. You might ask: is it too late to get into the legal cannabis industry?
Why should I get into the legal cannabis industry?
There are many reasons why it may be smart for you to join the cannabis industry. Below are just a few of the many:
Entering a new industry causes disruption, which can then lead to innovation for future products.
Shaping the laws, rules, and future
In a new industry, things develop at a fast pace. Because of this, there is often no “right” answer in the industry. The plus of this is that the boundaries are untested – this gives you the opportunity to explore unanswered questions/issues and pave your own way.
Who knows? You could start new trends and standards for marijuana production in your local/statewide industry!
Not everyone will succeed, but entering now gives you a better chance of growing/succeeding. Additionally, it also gives you a better chance for your exit strategy in the future for selling your marijuana business or getting acquired. However, there is more to the marijuana industry than just being pro-cannabis. At the end of the day, it still takes a business-centered approach.
Tips on breaking into the industry
Here are some starter tips for starting your cannabis business:
1. Come up with a unique idea
With the industry booming right now, businesses with similar concepts are multiplying by what seems the second. It’s important to position your company in a way where it fulfills an unmet need.
There are many sectors of the marijuana industry to go in besides dispensaries and grow operations. Research each of them in detail and formulate your cannabis company from there. Industrial hemp is another rapidly growing industry to look into, as well as CBD.
2. Understand your customers
As with any business, knowing what your target customer base is crucial. You should promote all marketing, advertising and product efforts to your audience.
3. Know (and follow) the rules
No matter how great and innovative your business plan is, you’re going to get shut down if you don’t follow the rules set forth in state laws. The rules and regulations surrounding the marijuana industry are incredibly complex and there are a lot of moving parts.
It’s recommended to hire an attorney to navigate the process and ensure your business’ validity.
4. Raise capital
As with any start-up, investment capital is vital to getting your business up and running. Despite its legality in Michigan, some investors don’t want to put their money into the cannabis market since it’s still illegal according to United States’ federal law.
Since the SAFE Banking Act is still in the throes of Congress at the federal level, it’s best to find solid private investors. Look to an investment firm or your attorney to connect you with the right investor(s) for your business.
Recreational marijuana applications now being accepted
It is definitely not too late to get into the legal cannabis industry. Just last week, the MRA for the state of Michigan released applications for the following adult-use license types.
- Class A Marijuana Grower
- Marijuana Microbusiness
- Designated Consumption Establishment
- Marijuana Safety Compliance Facility
- Marijuana Event Organizer
- Temporary Marijuana Event
These license types are ones that do not require a medical marijuana state operating license. The Marijuana Regulatory Agency (MRA) will begin accepting applications on Nov. 1st of this year. The MRA will be enforcing a two-step application process consisting of a (1) Prequalification and (2) Establishment Licensing application.
More information on this process can be found here.
Contact a cannabis lawyer today
It’s vital to have an experienced cannabis attorney assist you with this process. Doing this will ensure that you are starting on the right foot in this exciting yet complex industry.