Is Owning a Cannabiz Everything It’s Cracked up to be?


In the new and rather booming industry that surrounds the recent legalization of marijuana in select states, a new question has been posed: how does a business advertise for marijuana responsibly and legally in a country where it is still banned by federal law?

There have been many strict rules created regarding the marketing and advertisement of marijuana, forcing businesses who advertise online or otherwise to use vague, indirect language and euphemisms to reach its customers. This is aimed at keeping the advertising away from children, as most adult products strive to do. However, many find this counterproductive, as their products are directed at a select audience and this makes it tedious to connect with them. Even big names like Google and Twitter are reluctant to allow bold-faced advertisements, which executives in the legal marijuana industry find hurts these business’ potential revenue as well.

With the unique set of rules set out for those in the cannabis industry, it is becoming harder for potential buyers to find their sources and actually purchase them, even with marijuana prices on the decline.

A few of the hurdles that new marijuana businesses must climb over include: 

Money Loans

Since weed is still classified at the federal level as a level I narcotic, the idea of federally owned banks handing out loans for cannabis startup companies does not sit well. Most small businesses will typically seek out loans from an FDIC, but cannabis startups cannot. This means that cannabis entrepreneurs are being forced to turn to private loans with much higher interest rates, and equity-based loans that run off of a business’ current worth, making it difficult to attain.

Money Storage

Not only are banks and other financial institutions hesitant to loan money to the cannabis industry, they aren’t too excited about taking their money, either. This means many in the marijuana industry have been left with no option but to deal in cash only, posing a giant security risk.

As the industry is very successful, this means there is a lot of cash being stored in the brick-and-mortar stores themselves. Knowing this, people try to take advantage, forcing employees to have to do things like walk to their cars together to avoid being robbed and transport their earnings in armored cars. This also means that employee salaries must be paid in cash only.

Restrictions on Business

It isn’t possible for marijuana businesses to simply open up anywhere they choose. City and state-wide restrictions stop them from putting up their stores near residential and school zones while also limiting the hours of business. Along with this, there are a number of tax laws that prevent cannabis businesses from claiming business expenses related to the distribution or production of goods that are still federally illegal, costing them even more money.

Marketing Restrictions

Those in the marijuana business cannot simply advertise their products to the public at large. They are not allowed to advertise anywhere that may be seen by minors, taking away the use of billboards, television ads, and some online advertising marketplaces. As they are also barred from advertising on sidewalks, in parks, or any other public space, this also hurts their ability to advertise on their own property.

Owning and operating a marijuana business might seem like a lucrative dream to many, but for some businesses that are already functioning, it may feel more like a nightmare figuring out all of the logistics. If you are considering starting up your own cannabis business, these are a few things that you should take into account before you begin, in order to make you aware of what you are getting yourself into.

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