Starting a marijuana business is an exciting prospect. The industry has grown exponentially. Today, medical marijuana is legal in 38 states and DC, while adult recreational use is legal in 19 states and DC. More and more people are expressing interest in trying it in its various forms for a range of purposes from sheer curiosity to managing chronic health conditions.
Businesses have the potential to do well. However, the process of getting started comes with several challenges unique to the cannabis industry. Here are some of the most common marijuana business challenges you should know about and what you can do to face them.
4 Common Challenges in Starting a Marijuana Business and Their Solutions
Limited Banking and Financing Options
Starting any business, marijuana-related ones included, is expensive. It’s not uncommon for entrepreneurs to seek a loan or other forms of financing to get things moving. The problem for aspiring cannabis business owners is that, despite more and more states legalizing its use, marijuana is still illegal at the federal level. As a result, getting a loan or opening a bank account with a traditional bank can be almost impossible. On top of that, you also can’t use credit card processing machines.
The SAFE Banking Act protects banking institutions that want to provide financial services like loans to cannabis businesses, but it has yet to become law. Fortunately, you have another option — Bespoke Financial.
The first licensed commercial lender focusing on the cannabis industry, Bespoke works with companies in various sectors, from growers and manufacturers to distributors and retailers, offering a range of fast, flexible financing solutions. They make it easier for you to get the capital you need to start and grow your operation.
Ongoing Legality and Regulation Issues
Cannabis business owners have numerous state laws and regulations to contend with to stay compliant. Every state has its own set of cannabis laws, which can even vary from one city or municipality to the next. They also have to worry about federal regulations.
Compliance is critical. Failure can lead to many problems from citations to being shut down. It can also result in significant legal issues, including hefty fines and jail time. You need to stay up-to-date on local, state, and federal laws and regulations. Things like reading industry news and working with knowledgeable and experienced partners can help.
Public Perception and Overcoming Stigma
Views surrounding cannabis are changing. However, stigmas persist. Many people still see it as a “gateway drug,” think all users are lazy stoners, or legalization will lead to increased use among minors.
You can work to overcome these and other types of stereotypes in a few ways. For instance, you can publish informational blog articles that educate users about safe use and potential risk factors. Other options include sharing positive stories covering how cannabis has helped real users or contributing to (or starting) conversations on social media.
Branding and Digital Marketing Hurdles
Branding and marketing challenges tie back to some of the others mentioned above. Numerous rules and regulations surround the types of images you can use and how you can (and can’t) advertise. You also want to avoid perpetuating stereotypes when creating your brand or establishing your presence online. Working with a branding and digital marketing company experienced in the cannabis industry can help ensure you stay compliant and reach your target audiences.
Facing Marijuana Business Challenges
While you may face many challenges as an aspiring cannabis business owner, starting and running a successful company can be within reach. As with starting any other company, it takes hard work, dedication, a willingness to learn, and finding solutions to face obstacles along the way.