The cannabis business has just received a massive boost from all across the world. The legalization and acceptance of cannabis by government entities and the general public open up new avenues for the cannabis industry to expand. New cannabis policies are bringing in opportunities that are in some ways altering the industry.
To prove this fact, let’s have a look at some of the stats:
- According to a report by CNBC, Wall Street’s top cannabis analyst believes that the U.S. sales of marijuana will rise more than $80 billion by 2030.
- The global legal marijuana market size is expected to reach USD 70.6 billion by 2028, according to a new report by Grand View Research, Inc.
- As per Business Insider, the legal cannabis industry could skyrocket to $100 billion in the US alone by 2030.
With these facts, we can say that technology and cost are a few of the major contributors to such change. Science, agricultural, digital, and commercial technology advancements have made things easier or even better than before. Understanding cannabis is now a little easier, but there’s still a lot to learn!
So let’s first understand the technology factor that is shaping the cannabis industry.
Technologies Transforming Cannabis Industry
1. Smart Technology For Intellectual Property
Patents can be applied by cannabis breeders who create new strains to safeguard their intellectual property. If the strains were created via traditional breeding processes, they can do this. And apart from that, technology is transforming cannabusiness in other forms as well.
For example, BLOCKStrain, a software firm, assists cannabis breeders in tracking their IP in the same way that cryptocurrency transactions are tracked. It employs cutting-edge technology to store and track Big Data pertaining to marijuana strain genomes.
BLOCKstrain unites traditional cannabis culture with modern crypto-technology to create a smart platform. Its safe and unchangeable blockchain platform ensures worldwide cannabis strain certainty and ownership.
2. IoT Automation
Cannabis plants require a lot of attention to detail and strict schedules due to their temperamental nature. That’s why, to connect to the growing operations and control settings specifically for cannabis, many cannabis farms have turned to IoT technologies, such as agricultural sensors.
Growers may add thermostats, temperature controls, humidity sensors and controls, scheduled watering, light cycles, and more to a connected growing system to assure the best conditions for their plants.
The producers can track their product from seed to sale with the use of IoT systems, which use tracking IDs to identify plants throughout the germination phase and follow them as they grow, are harvested, dried, and sold.
Such meticulous documentation helps the owner to monitor the business and hunt down any issues, all while increasing customer transparency across the supply chain.
3. AI For Packaging & Labeling
Marijuana labeling must include accurate information as well as secure packaging to keep out of children’s hands.
For example, Strain Brain utilizes AI on its website. It offers a cannabis product label that can be customized to your specifications, to contain the details of each dispensary, as well as scientific data and pricing.
Each label includes a QR code that can be scanned with any compatible smart device to obtain information. It’s useful for keeping track of products and giving customers the information they need to choose the ideal marijuana strain for their needs.
4. Seed-to-Sale Technology
For both producers and retailers, this technology has been a game-changer in the cannabis market. Shopify, which is best known for its online retail sales platforms for brick-and-mortar businesses, is now doing the same for the marijuana industry.
For example, the cannabis sector benefits from Shopify’s software-as-a-service (SaaS) cloud platform in two ways:
Retailers may now evaluate data on consumer purchasing behaviors, for starters. Because sales were illegal in many places at first, the cannabis market was dominated by cash transactions.
This makes it impossible to track purchasing patterns. Marijuana sellers can use Shopify’s eCommerce platform to help with ordering and analyzing what is and isn’t working in terms of product or margin.
Second, Shopify’s cloud-based compliance software may help with documentation from seed to sale. It keeps track of the product from the time it is planted until it is sold on dispensary shelves, ensuring that consumers receive a high-quality product.
Make sure you choose a well-experienced healthcare application development company to start with your online business.
5. Real-Time Video Surveillance
Licensed merchants and microbusinesses that engage in cannabis retail sales must use a video surveillance system to record point-of-sale areas and places where cannabis goods are exhibited for sale.
The positioning of cameras at each point-of-sale location must enable the recording of the facial characteristics of anyone buying or selling cannabis, as well as anyone in the retail space, with sufficient clarity to identify identity.
Digital video surveillance systems are used by licensed establishments to effectively monitor and record images of the area under surveillance at all times.
Recreational cannabis has been around for a long time, so it’s understandable that many governments are attempting to legalize it in order to collect taxes from newly established legal cannabis businesses.
Medical marijuana, on the other hand, holds a lot of promise. It can be used to treat a variety of medical ailments and symptoms, as well as a supplement.
The cannabis industry is largely conducted online. That isn’t to say that dispensaries aren’t worthwhile investments.
If you want to invest in a project like this, you should know that these stores make a lot of money.
how to sell weed and make money online? How much does it cost to start a dispensary? This is one of the first questions you should ask yourself. Will this online cannabis seed business pay off?
However, even in the most saturated areas, the surging demand for cannabis provides significant opportunities. Retailers looking to compete with big-box stores should work smart, focus on establishing a positive in-store experience, and invest in cannabis technology that streamlines operations and reduces costs.
How Much Does It Cost To Start A Dispensary?
Selling cannabis online does have similarities to setting up any other online business. You need to set up an eCommerce store with a hosting provider, develop content, create social media accounts for your business, and the list goes on.
There are several ways to be successful in selling cannabis online. Choosing the right platform and building a strong brand presence is critical along with knowing and understanding the cost to develop a cannabis app
Obtaining a license is the first step in starting a dispensary. The licensing process is lengthy and costly, and it differs by location. Expect to go through extensive background checks and pay a licensing cost.
In some states, like Washington, the number of licenses granted by the state is limited, and they can only be obtained by purchasing one from an existing licensee
License is important whether you are running a brick-and-mortar store or running an online cannabis shop, because selling weed online may be legal, but it still has several restrictions.
2. Capital Requirements
Aside from the license and possibly legal fees, many people are turned off by the industry’s capital requirements. Some states demand proof that you can afford the full cost of running a cannabis business before granting you a license. A local government may require proof that you have enough liquid assets to keep your business afloat in tough times, depending on where you apply for a license.
It isn’t hard to find a location for a weed business shop, but it can be costly. Dispensaries can be legally close to a school, church, park, arcade, and/or anywhere else where children are expected to congregate, according to city and state restrictions.
Cannabusiness might cost up to hundreds of thousands of dollars per year to find an acceptable location with foot traffic and parking. It’s critical to spend more money to make the store more welcoming, pleasant, and modern in order to keep people coming back.
4. Platform for E-Commerce
Despite the fact that cannabis is legal, cannabis banking remains a challenge for some. Not all eCommerce platforms are willing to accept cannabis sales for this and other reasons. Fortunately, there are two excellent alternatives.
WooCommerce has worked with Square and Viva Wallet to make payments secure and convenient for users. Shopify is another great choice for all of your cannabis e-commerce needs, and they’ve put together a comprehensive guide on how to sell CBD on their platform.
5. Cannabis Business Cost for Banking
Cannabis’ legal ambiguity creates a shaky relationship with state-licensed enterprises. When banks collaborate with cannabis businesses in the United States, they accept the risk that government enforcement priorities may shift, making cannabis technology-friendly institutions a target.
The majority of banks are unwilling to take on the risk. Others, such as local credit unions, demand a premium for their services and the risk they assume. Some banks charge cannabis businesses thousands in monthly holding fees!
6. Staff Costs
The cannabis business costs to get dedicated employees, which will be a bit expensive!
Human resources have always played a crucial role in the establishment of any business, and a dispensary is no exception. Even if you have a clear vision of how you want your dispensary to run, you will find it difficult to put your plans into action without the help of others.
Furthermore, the cannabis market provides several job prospects; however, the dispensary owner is accountable for handling such operations, which necessitates the expenditure of dollars. It would be advantageous if you had a team of motivated, experienced, and well-trained individuals ready to take the company from startup to conglomerate status.
According to the stats released by MJBizFactbook, the entire economic impact of marijuana sales in the United States in 2021 is predicted to exceed $92 billion, up more than 30% from last year, and upwards of $160 billion in 2025.
7. Day-to-Day Costs & Smart Investments
A dispensary can’t function without merchandise, customers, and employees. Growing your own cannabis in a state that enables vertical integration can cost more than hundred dollars per pound, not including inventory costs for edibles, topicals, and other goods. A crew of budtenders, a store manager, and a master grower can cost thousands of dollars in salary (per year). Finally, keep in mind the costs of insurance, license renewal fees, taxes, legal retainers, and trademark protections.
By investing early in technologies that can improve their operation, a wise cannabis retailer may save time and money elsewhere. Investing some amount in hardware and software, such as computers, an integrated point-of-sale system, and a complete security system, can be a significant initial expenditure, but it could save your company money in the long run.
Technology has altered many aspects of our lives and made work easier for the majority of us. As time passes, technology will continue to evolve. Although technology has numerous advantages in the cannabis sector, it also has certain disadvantages. There are several possibilities to collaborate with a company but, it is advised to choose the one that has the knowledge of the market like Appinventiv.
There are numerous success stories in the cannabis retail industry. It’s difficult and costly, but the reward for a wise and well-informed business owner is huge.
Hopefully, now you have a better knowledge of what it takes to set up an online cannabis shop. Those who are willing to put in the effort and follow the guidelines have a great chance of succeeding. If you follow simple steps and are interested to discuss more regarding your cannabis business we are happy to help.