As the number of states that allow cannabis is growing rapidly, the number of cannabis-related businesses is growing fast.
That means that people are investing in all of the different cannabis products like cannabis extraction companies around the country. If you want to start your own extraction company, there are a few things to think about in advance.
Here are five things you need to consider when you want to start an extraction company.
1. Set Your Budget
When you want to start any kind of business, you need to start with a budget. If you don't know how much money you're starting with, you could risk going into debt just to get it off the ground. If you can't start off on a good foot financially, you're going to struggle to maintain balance as you grow.
You're going to need a lot of equipment when you want to start your extraction company. If you're planning on doing the actual extraction on site, you're going to need safety equipment as well. Every municipality has their own regulations for setting up a business like this but you should familiarize yourself with OSHA guidelines.
Between the tanks, fittings, pipes, and vessels you'll need, there will be a lot of upfront costs. Find an investor who can help you out or see if there's another extraction company who has old bug functional equipment that you could buy.
If you're planning on being a middleman or a distributor of extraction goods, you'll need to find a supplier. You'll have lower startup costs but you'll still have to set up a budget to pay for staffing, office setup, and getting licensed.
2. Figure Out Your Growth Plan
Every business needs a business plan. Without one, you're going to have trouble figuring out where your next source of income will be when you hit the ceiling on one.
You need to know what your goals are. You need to set goals when it comes to taking over a marketplace. Then, you should have a direction for where you want to take your business once you meet that goal.
You'll start with a core group of staff and employees at a location that might be generous for space now. However, you need to have a plan for what it would take to expand. If you spend all of your money on your location, only to outgrow it in a year or two, you'll be in a tough situation soon.
Think of your business plan as a road map of where you want to go and how you're going to get there. Once you have the generalities mapped out, be as specific as possible as you plot your course. This way you can be sure that every choice you make is oriented toward your goals.
3. Check Out Your Local Market
Every business has a market to contend with. When you're first starting out, you'll need to set a reasonable goal as to where your market is and how you're going to dominate it. If there's already an extraction business in your area, you have a challenge ahead of you.
If you're working in a robust cannabis environment, that's good for business because there's a receptive audience. It also means that you'll be facing competition. In order to beat this competition, you need to set yourself apart.
The way to do that is to cater to what the wants and needs of your local market are. If you find that the people in your region like products and services that are locally-grown and organic, cater to them. If they prefer things to be hip and trendy, you're going to have to cater to that market.
No matter what the local market is, you need to listen to your consumers. You can have the best product in the world but if you're not selling it the right way, you'll end up shuttering in no time.
4. Grow Your Presence Online
One of the most important tools for telling potential customers and clients about your products and services is via the internet. The internet is awash with cannabis-related businesses offering all kinds of services.
If you don't have social media profiles for your company, it's time to get started. Start off simple, by adding duplicate information and the same avatar to every single channel. That's how people will know they've found the right company.
Add contact information and content about your products and services.
Start a blog that's connected to your URL in order to attract more traffic. Write short posts a few times a week answering your clients' most common questions and concerns. PAck your posts with your keywords and local geographical terms so that search engines can direct user searches to you accurately.
5. Find Alternative Distribution Channels
Once you've got your products on your website and perhaps a brick and mortar location set up, you need to find ways to get products out there. A distribution channel beyond just e-commerce and your shop can put your products in stores around the country.
You might need a skilled sales person on the ground, but if you can get your products and services into shops and stores, you'll see a huge sales boost. Offer discounts when shops buy in bulk or ask them to price your products as BOGO and you'll build an audience fast.
Cannabis Extraction Companies Can See Huge Profits
As the market for products that cannabis extraction companies can provide continues to boom, the number of people investing is growing. With more investors comes more opportunity to grow, but you need to make sure you have a strong plan. A lot of money with no plan in front of you is a recipe for disaster.
If you want to learn a little more about the science of extraction, check out our guide.