Now that the Garden State has a pro-cannabis governor in Trenton, more people are taking note of the changes that have been proposed for NJ’s cannabis industry. Finally, it’s less a matter of if, and more of a matter of when.
As people take notice of cannabis events like the NJ Cannabis Symposium Series popping up in NJ, geared toward preparing business owners who want to participate, we continue to get reactions of surprise and questions of, “isn’t it a little early to be planning for this?”
And if you thought yes, you’re likely already behind.
New industry participants stand the best chance to compete with multi-state license holders by starting early. Here’s why:
The cannabis industry is a well-developed, albeit segmented, industry with hundreds of thousands of individuals involved on a daily basis, generating some $7BN in annual revenue. There are companies that have footprints in as many as 13 states; and it’s not just one company – there are no fewer than 17 companies with at least one location in 2 or more states.
There’s a constant thread in the news that is inadvertently perpetuated; “It’s the wild west, anything goes, there’s no industry standard or correct way to do things…”
Cannabis coverage via mainstream outlets is becoming more commonplace, but we still have a long way to go to expel the misinformation and stereotypes about cannabis as a legitimate business.
At one point in time, this wild west claim may have been valid, but those days no longer. Are there further advances to be made? Of course. But medical marijuana has been legal in California for over 20 years now, and the industry has grown up and continues to evolve. At the last annual industry conference, MJBizCon in Vegas, 678 vendors witnessed 18,120 attendees pass by over 3 days.
While not formally adopted, there IS an industry standard developing. Dozens of experienced consultants have woven a web in order to network the entire industry together, constantly improving on standards, all while navigating evolving regulations. Non-profits like ASTM International have developed committees for the development and maintenance of industry standards in cannabis just like they’ve done 12,000 times across the globe in nearly every other industry. We attended the most recent committee meeting in New Orleans last month, and it was truly amazing to see how far we’ve come in this regard.
An unfortunate result of the “industry as the wild west” mindset is the perception that a newcomer can enter the industry in 2018 and “figure it out” themselves and still be competitive within the market. This is no longer the case because there are so many experienced, well-capitalized, hyper-competitive opponents out there doing everything they can to gobble up new licenses in as many new states as possible. Settling into an “I got this” school of thought is unfortunately an easy way to flush a million bucks down the drain.
Those looking to enter into the cannabis industry as a new applicant must start to prepare for licensing and operation as far in advance as they can in order to become competitive with the well-established players from other states and countries like Canada.
- completely engross themselves in the industry as it exists in other states so they can make projections as to what the new program may look like in their state, and make decisions based on those conclusions
- Familiarize themselves with the cannabis application process
- Start preparing their application based on what it is expected to contain
- Attend the major tradeshows like MJBizCon and CannMed and other smaller regionally focused shows to get a sense of what information and resources already exist
- Tour as many operations in as many states as possible, learning what has been working, what hasn’t, and what they’d do differently given the opportunity to start over
- Lean on the experience of industry professionals who have consulted on or worked inside well-established operators (Admittedly this last one sounds self-promotional, but it’s tricky to find a balance between providing written advice and helping people understand that no amount of information is replacement for an expert partner)
The multi-state competitors are already 50% complete with the aforementioned process. They’ve done it in at least 2 states. They likely have a team dedicated to preparing and applying for new licenses. The best way to offset any disadvantage as a new industry participant is to start early.