How to Start a Cannabis Business

Are you interested in starting a cannabis business? If so, the Master of Cannabis Certification Program from Cannabis Training University is right for you. CTU provides in-depth information on cultivation, extraction, infused product, retail, and ancillary cannabis businesses.

Our online-based curriculum provides aspiring cannabis entrepreneurs with step-by-step instructions on launching a marijuana business. If you’re interested in pursuing your cannabis business idea, here’s what you need to know.

Become Knowledgeable About Cannabis

Whether you want to start a cannabis dispensary, farm, or manufacturing facility, you need to understand the industry terminology related to businesses, medicine, law, cultivation, cooking, and extraction.

The Master of Cannabis program provides you with several downloadable handouts covering essential business terms you need to know, including cannabis collective, point-of-sale system, surety bond, moratorium, merchant account, and SEO.

For example, as a business owner in the cannabis industry, you need to understand vertical integration, a business structure where one organization completes all parts of the supply chain (cultivation, manufacturing, sales). Vertical integration is a requirement in some states.

Understanding cannabis terminology allows you to communicate with experts about investment opportunities, customers, and your staff. We teach you everything from strains to terpenes to the most popular cannabis products and provide downloadable handouts you can refer to later.

Find Your Niche Market

Where do you fit in the cannabis industry? You may have an entrepreneurial spirit but aren’t sure what segment you want to focus on. Understanding every aspect of the supply chain, from cultivation to retail, can help you find an underserved niche market.

CTU provides you with in-depth instruction on the setup and operation of cultivation, extraction, infused product, retail, and ancillary cannabis businesses. You'll understand how each segment works and the challenges involved with each business type.

Understand Federal, State, and Local Rules and Regulations

Research the applicable federal, state, and local cannabis regulations to determine the eligibility requirements for business license applicants and operational restrictions for cannabis businesses. Understanding the rules can help you remain compliant and avoid a license suspension.

CTU’s Master of Cannabis Certification Program features up-to-date rules and regulations for all states in the U.S. and provinces and territories in Canada and many countries around the world. Staying on top of the latest legalization laws can show you where you can continue to expand your business.

Be Aware of Industry Challenges

The legal cannabis industry is one of the fastest-growing industries in the country. However, cannabis companies still have many hurdles to overcome, primarily due to cannabis’ federally illegal status. Federal legalization of cannabis would overcome many of these challenges.

CTU’s Master of Cannabis Certification Program provides you with a complete overview of challenges in the cannabis industry.

Banking

Banks are hesitant to lend money to cannabis businesses, but some may operate accounts for these companies. Recent estimates indicate that over 400 banks and credit unions in the U.S. operate accounts for cannabis businesses.

If you’re interested in opening a cannabis company, be prepared to pay more for a business bank account and various deposit and transaction fees. Banking reform under the SAFE Banking Act has been considered several times by Congress.

Taxes

The Internal Revenue Service civil tax code section 280E states that “no deductions or credit are allowed for any amount incurred in a business that consists of trafficking controlled substances prohibited by federal law.”

Cannabis’ illegal federal status means businesses must pay taxes on their gross income, unlike other companies that only pay taxes on their net income. Working with a professional tax accountant can help your business entity navigate the 280E tax code. 

Black Market

The illegal cannabis market still has a strong hold over the marijuana industry. Legal cannabis businesses have a hard time competing with black market prices. Cannabis businesses must make high-quality products at competitive prices to retain customer loyalty.

Security

Because businesses do not have access to traditional banking, cannabis businesses must deal in cash. Having a lot of cash on hand significantly increases a business’ security risk. Businesses will need to hire security services to transfer cash and work with a bank that accepts cannabis money.

Cannabis businesses must have a strong security plan that may include security systems, fencing, guard dogs, and other loss prevention strategies.

Compliance

Cannabis businesses must adhere to fire, building use, zoning, and environmental controls. In addition, each jurisdiction has its own regulations, and regulations can vary between medical marijuana and adult-use marijuana markets. Staying informed about the latest rules and regulations can require a lot of attention and patience.

When starting a weed business, you must remain compliant with your state’s tracking regulations. Tracking will be done on a complex computer program. Mistakes with the tracking program can lead to fines, audits, and closure.

Create a Business Plan

A cannabis business plan lists your organization’s objectives and how it plans to achieve its goals. A business plan can include a go-to-market plan, competitive and industry research, mission statement, financial estimates, and other information that can be relevant to investors.

A comprehensive business plan should include an executive summary, market analysis, company description, marketing and sales plan, and a facility operating plan. Learn more about creating a business plan and view a sample business plan used by an actual business by enrolling in CTU’s Master of Cannabis program.

Apply for Licenses and Permits

CTU makes it easy to apply for a cannabis business license in states that have open application periods. We update the laws to reflect the current license availability in every state, province, and territory and provide links to license applications and fees.

Business license requirements vary by state. For example, some states allow for an unlimited number of licenses, while others may restrict the number of business licenses they issue. Consider residency restrictions, background checks, and other licensing restrictions.

Join the Cannabis Industry Today!

Join thousands of other satisfied Cannabis Training University students. Learn how to apply for and run a successful cannabis business and explore different industry growth opportunities with world-class cannabis education. Sign up for the Master of Cannabis Certification Program today!