Cannabis or marijuana has been used by humans for thousands of years, yet in modern society, it has mainly been under prohibition and considered illegal despite the fact that many people believe it provides health benefits as well as euphoric highs.
There are two active ingredients in cannabis, THC, and CBD.
THC is the property that makes people feel high or stoned, and CBD is why many people believe in marijuana having medicinal benefits.
Indeed, there is evidence that cannabis has been used for therapeutic purposes as far back as 2,700 BC when Chinese Emperor Sheng Nung drank cannabis-infused tea to combat illnesses such as malaria, gout, and rheumatism.
Even in the modern world, there are tales that Queen Victoria used cannabis to combat her period pains.
In the 21st Century, however, many countries have become more liberal, and some such as Canada, the USA, and parts of Europe have legalized the use of cannabis.
This has led to many businesses springing up based around CBD and its associated products, as they try to provide health benefits to the masses.
If you are interested in the CBD business, read on about how to get started.
Why do you want to start a business?
When you decide to start any business, you have to know that your motivation is correct otherwise, the chances are that you will fail.
If you have a strong background in the world of cannabis and CBD and have plenty of experience growing plants and creating medicinal products or foodstuffs, then you are going to be in a good position to take advantage of this nascent industry.
However, if you have just decided that it sounds like a cool thing to do because it is the latest ‘hip’ new industry, then you are setting yourself up to fail.
Do you see this as a long term enterprise, or are you just looking for a hobby or supplementing your income?
These questions all need to be answered before you enter the industry as they will all require different approaches and strategies in order to succeed.
Who will you sell to?
Knowing who your target market is, is absolutely vital for any new business because otherwise, you will struggle to sell your product to the right people.
If you live near a college and think that there will be plenty of students to sell to who love to get high, then you are not going to get anywhere because they will not be looking for a cannabis CBD product; they will be looking to get high, and that requires THC.
On the other hand, if you are looking to create a product that has medicinal benefits that might help to calm people who are anxious or might help people to find their appetite after cancer surgery, then you will find that you have a ready-made market place as people are already actively looking for these sorts of products.
Make sure you have a clear idea of who you are trying to sell to, and then you will give your new business the best chance of setting out on the right foot.
Where will you source your raw product?
You have two options when it comes to sourcing the CBD that you will be using in your products; you can source the oil directly from a wholesale supplier, or you can grow the plants yourself and then extract the oil.
Many a first-time Ganjapreneur thinks that it will be a piece of cake to simply grow some plants in a greenhouse and then extract the oil, and hey presto, they have their product.
Well, this is not the case as growing the plants takes years of experience, and extracting the oil is a skill that needs to be learned from a professional.
A much better way to start is to source your oil from a wholesaler, and then you can concentrate on your products and your marketing.
Once you have established your business, you can then invest your profits and spend the necessary time learning how to grow and extract the oil from the plants.
Create a brand
Branding is paramount in any business, but it is particularly important when starting out in the world of CBD because it is such a competitive industry.
Your branding has to be clear, and also has to stand out as it needs to set you apart from the rest of your competitors.
If your product is being aimed at the medicinal world, then it needs to give an air of authority, whereas if you are targeting the recreational market, it can afford to be more playful.
Make sure that you use social media to reach your target audience as it is a great way of getting your brand known in the industry.
Make your photography attractive and make sure that your logos stand out, and then you will stay long in the memory of your customers, helping to ensure that you are profitable from the start.
Think about financing
Financing can be one of the biggest barriers to entry in the world of cannabis and CBD, as many traditional lenders will refuse to lend money to this sector of the economy.
In fact, many banks will refuse even to offer current accounts, so finding a way of handling your banking operations can be very stressful and, in some cases, impossible.
Make sure you speak to lenders that do not offer money to mainstream marketplaces, as they are much more likely to support your business.
A strong business model is also key, especially if you are growing your own plants, because there is a considerable lag between investing in your plants and receiving funds from your sales, and you don’t want to run the risk of going bankrupt in the early days.
As we have learned, starting a CBD business is not easy, but it is definitely possible given the right preparation and business acumen.
Knowing what you are trying to achieve from the outset is key, as is who you will sell to.
Make sure you are well-financed as many traditional lenders stay clear of the CBD market and create a strong brand so that there is awareness in the industry.
Decide early on if you want to grow your own plants or source oil directly from a wholesaler, and if you follow these steps, you will give yourself the best chance of succeeding at your new venture.
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