The Cannabis industry is booming, and you launched a weed startup to capitalize on that growth. Congratulations! You recognized a positive market trend, and you are more likely to see success because of it.
However, business success is never guaranteed, and in a brand-new industry like cannabis, the path to success can shift at a moment’s notice. At this point in your canna-business’s life, you need to focus on ways to avoid crashing and burning — and here are the best tips for preventing failure in the cannabis industry:
Plug Into the Laws and Regulations of Your Market
On one hand, cannabis’s piecemeal legalization has opened the door to allow entrepreneurs more opportunities to grow small businesses and find success. On the other hand, cannabis laws can vary wildly from place to place, meaning a Phoenix dispensary is subject to much different regulations than a retail cannabis shop in Oregon. What’s more, the novelty of the cannabis industry means that regulations will continue to shift as legislators, entrepreneurs, consumers and others find weaknesses in current systems.
Not only do you need to perform initial market research to understand the cannabis laws in your target market, but you need to stay connected to evolving cannabis regulations in that market. You might make connections with local legislators to get a heads up on upcoming changes to regulations, but closely following cannabis news can also suffice.
Stay Competitive With Your Direct Opposition
It is tempting to draw inspiration from canna-businesses around the world when you are crafting your business plan, but it is important that you pay closer attention to what your canna-competitors are doing within your own market. Just as laws and regulations frequently change, your competitors will grow and diminish as their businesses succeed and fail. Periodically, you will need to update research on your opposition and analyze which best practices you can adopt to remain competitive in your market.
Train Your Staff and Keep Workforce Morale High
Employee turnover is a significant concern for any venture, but cannabis businesses seem to struggle particularly with maintaining a consistent workforce. There are a few possible reasons for this, but a major one is training. Plenty of people are passionate about pot and expect that working at a canna-business will give them permission to be stoned 24/7. A stronger onboarding process, which sets employee expectations and equips them with the right tools for their job, will help mitigate this concern.
Further, you should put some time and energy into your canna-corporate culture. By thinking critically about the values of your business and brand, you will be able to attract and hire a workforce that shares and appreciates those values. A common culture is an important element of employee morale, which will encourage good workers to stick with your company as it grows.
Update Your Business Goals to Keep up With Performance
For most canna-entrepreneurs, winning a dispensary license in their target market is a make-or-break milestone. However, once you get your license and start operating, you need to be sure to have additional goals to push your business toward success. Too many canna-businesses fail because their leaders believe that winning a license is the most difficult obstacle; in truth, you should be setting and resetting your goals as you reach them, to ensure that you don’t become complacent and miss opportunities to grow your business to new heights.
Maintain Your Passion for All Things Cannabis
Few get into the cannabis industry without any prior experience with weed. However, just because you were a stoner in college doesn’t mean you have adequate familiarity with the current goings-on within cannabis culture. Too many cannabis leaders have gaps in knowledge regarding how consumers want or use weed today, and that can leave their businesses vulnerable to competition that has a firmer grasp on consumer demand.
Though cannabis is your business these days, you should strive to hold onto any passion you have for weed or weed culture. You don’t need to become a dedicated stoner to fill your knowledge gaps, but you should try to engage with your product on a regular basis and plug into common sources of cannabis culture. This will help you relate better to your target audience and your workforce even as your business finds success.
Just because an industry is booming doesn’t mean every business is guaranteed success. Regardless of the cannabis market you target, you need to work to grow your business — and that means paying attention to legal and cultural developments, watching your competition and setting adequate goals for you, your team and your startup.