Being an entrepreneur isn’t for the weak of heart. But, running a business in the cannabis industry? You’ll need to be well prepared – and maybe a little bit crazy too. The cannabis industry is the latest and greatest frontier for entrepreneurs, with a projected valuation of almost $150 billion by 2030 – but it’s also one of the most competitive and challenging landscapes to dive into. Especially when you consider how complex it can be to obtain a cannabis license and keep your business legally compliant.
But, regardless of if you’ve crossed the hurdle of securing a license, or if it’s your first time considering a cannabis business at all, with the right guidance, you can own and operate your own cannabis dispensary before you know it.
Here’s some key areas to consider that you may have overlooked:
- Understand the Playing Field for Cannabis in Your Neck of the Woods
The first step to opening a cannabis dispensary is to understand the regulations in your state. Each state has different laws regarding the sale of cannabis, and they can differ drastically even within state lines, so it’s important to do your research before you start your business. Take advantage of free resources that can help you understand the landscape before you take any moves into business.
Understanding your region’s unique legal landscape will also help you assemble an essential part of your business plan as you get ready to open your doors: your SOPs. SOPs, or Standard Operating Procedures, help you ensure that your business is running efficiently and compliantly – helping you stay on track.
- Tackle the Obstacle of Licensure Early
For those with a love of all things cannabis, opening a dispensary may seem like the perfect way to turn your passion into a business. However, before you can start selling your wares, you’ll need to obtain a cannabis license from your state or local government. But be aware, while worthwhile, the process of obtaining a license can be complicated and expensive.
Your application will require things, like your business plan, proof of financing, and background information on all team members. In some cases, you may also be required to submit to a background check, proof of interest in acquiring insurance, or in some states, proof of a security plan.
Once you’ve submitted your application, the next step is to wait for a decision from the licensing authority. This can sometimes take months, so it’s important to be patient. If your application is approved, congratulations! You’re on your way to opening a compliant cannabis dispensary. If not, don’t despair; simply review the feedback you received and try again. With some perseverance, you’ll be serving up joint after joint in no time.
Next comes obtaining a business license. This can be done by contacting your local business office or Chamber of Commerce. They will be able to provide you with the necessary paperwork and help you get started on the process.
- It’s All About Location, Location, Location
The next step is to find a location for your dispensary. You can either look to repurpose an existing building OR build your shop from the ground up. In either event, it’s important to choose a location that is easily accessible and visible to potential customers. You will also need to make sure that your dispensary complies with all local zoning laws. Especially in states with more established cannabis markets, you’ll want to select a venue that works to your advantage, ideally in an area without an existing competitor nearby.
- Consider Your Biggest Asset: Your Employees
Your employees are a huge consideration when you own and operate a dispensary because your employees are responsible for creating a positive experience for customers. From customer education to product promotion, your employees are an essential part of your dispensary. Scarily enough, the average turnover rate for budtenders is over 55% within a year, making it even more important for you to prioritize employee education and empowerment through clear standard operating procedures. If possible, try to hire experienced leadership, like managers, to help train younger or less experienced staff.
- Make Marketing a Priority
If you’ve recently opened a cannabis dispensary, you might be wondering why marketing is so important. After all, you have a product that sells itself, right? Wrong. In order for your cannabis business to be successful, you need to attract customers and build loyalty. And one of the best ways to do that is through effective marketing. By investing in SEO and Google Ads, for example, you can ensure that your dispensary comes up first in Google searches. You can also use targeted advertising to reach potential customers who live near your dispensary. In addition, effective marketing can help you build brand awareness and create a distinctive identity for your business. So if you want your cannabis business to thrive, don’t forget to prioritize marketing. It could make all the difference.
- Assemble a Solid Tech Stack to Support Your Business
As cannabis dispensaries become more prevalent, it’s important to have a strong tech stack to support your business. Dispensaries rely on software to track inventory, process payments, and manage customer data. Anything you want to do in the cannabis space – including everything outlined in previous bullet points, such as licensing, SOPs, and marketing – can all be enhanced through technology. Without a robust tech stack, dispensaries can quickly become overwhelmed by the sheer volume of data they need to manage.
Need help selecting the right tech stack for you? Schedule a free consultation with the MJstack team, to begin better aligning your cannabis technologies for optimal success.
