Starting up a new business takes some things – initiative, idea, capital, and a good business plan.
Sometimes it is easier to find and gather the first three than to make a good business plan. In there you have to have everything worked out, planned, predicted, and sometimes if you don’t know what you are doing you can and you will make a huge mistake that will cost you a lot.
A business plan should be a foundation to every business endeavor and a solid business plan has to be written correctly for you to follow it through. Today we will give you several easy steps you have to take to write a successful business plan for a cannabis company. Why cannabis? Well if you didn’t know 38 states have active legislation that either legalizes cannabis recreationally or medicinally or completely decriminalizes usage of this drug. Thanks to this growing cannabis, distributing it or even selling it is a very sought out business idea and a very viable one.
So thanks to that today’s article will help you figure out how t write a good and quality business plan for this and if we managed to miss something check out https://www.ogscapital.com/article/cannabis-business-plan/ and see what they have to say about it.
Steps before a business plan
1. Real Estate
Before anything else, you have to find proper cannabis real estate. A proper zone for this is essential before starting this sort of business. If you don’t have a lease or a purchased property then your cannabis business is doomed to fail from the get-go because obtaining a business application without one of these two is virtually impossible. What you need to do to complete this task is to get an experienced cannabis realtor that knows his way around the zoning and any other obstacles that may come across.
2. Budget correctly
One of the things you have to consider is that landlords willing to lease to cannabis businesses will likely charge you a premium because they know that there is a huge demand for these kinds of property’s and they know that they can get away with lees overcharging. Another thing to consider is that some of these landlords will ask for very large deposits to cover all the potential risks that come with a cannabis involved business.
The business plan
1. Business model
This first step regards the part of the cannabis industry you want to be in. This is an important first thing to figure out because it will help you position yourself correctly from the start. It is important to know what you want to do and you can opt for anything from opening a dispensary, growing, or delivering.
Whatever you opt to do the most important thing is to read up on the state laws to make sure your cannabis business model is legal in your jurisdiction. Also, keep in mind that laws regarding cannabis can significantly change from one state to other.
2. Business cost
An essential part of every business plan is cost predictions. This requires a lot of research and time and it has to be meticulously done. There can be room for errors and you have to predict every single cost that will affect your business no matter how big or small. Price changes for equipment, parts, seeds, or whatever else is a part of the cost for your business also has to be predicted and represented in the cost side of your business plan.
3. Expected profit return
Here you have to address anything from the price to the period you predict you will make a first profit return. You have to pay attention to pricing and you have to be in the same ballpark as your competitors if you want to make a profit in any normal period. Profit returns will greatly depend on the time as a factor but you will also have to consider the total investment in the business. The faster you manage to make a profit the viable and better your business model and plan are.
4. Customers attraction
Sometimes overlooked, but this part of the business plan is very important. Here you will have to address your marketing types and plans and with it, you will show just how exactly you will attract customers to your business. You also have to address. Marketing is very important and knowing your customer base and the audience is very important especially when you are trying to pick a correct marketing strategy. Marketing is another huge expense so try not to overlook it in the expense part of your business plan.
5. Why is your business better than the competition?
This is a bit philosophical part of the business plan, but it is essential as well. Here you have to convince whoever is going to read this plan that what you are doing, or trying to do is in a way better and more profitable than what your direct competitor does. You have to implement any kind and any sort of innovation into the business to set yourself apart from a vast amount of businesses doing the same thing as you. Sometimes of research and preparation wouldn’t be a bad thing to do before writing this part of your business.
6. Legal counsel
In any business, you have to plan and predict the cost of retention and legal utilization. In any business plan, you have to have this laid out and you have to plan for this no matter if you will or won’t have any legal problems or anything similar. In this part, you have to state if you already have legal counsel and how it will help you keep everything in order, or if you don’t have it how do you plan to obtain it.
Every business plan is and has to be a lot more detailed than this. These are just simple steps to help point you in the right direction. Every step we have here has to be more thorough, more detailed with a lot of graphs, pie charts, and so forth. You have to place everything in order from the summary of your company down to products, marketing, strategy, personnel, and a detailed financial plan. Take these steps as a very rigid form or even a pointer into what you have to focus yourself on to make a decent business plan that is easy to follow and understand.