The marijuana industry has been skyrocketing over the past years in the United States because of various legalizations that happened in many states. More than 30 states have legalized medical marijuana, 11 of which allows the use of the plant for recreational purposes, including Washington, DC. Cannabinoids have also been generally accepted, especially cannabidiol (CBD). In fact, only Idaho, Nebraska, and South Dakota have extremely strict laws regarding cannabinoid use.
The Current Landscape of Cannabis Investing
With such progressing perception of the plant and the compounds, it contains, the legal marijuana industry in the US has reached a new high, with an estimated value of $13.6 billion in 2019. It was also known to generate 340,000 jobs in the same year. Should this kind of success continue to occur, then the industry is projected to reach a market size of $73.6 billion by 2027 with a compound annual growth rate (CAGR) of 18.1%.
The projected success of the industry has caught the interest of investment companies and individual investors. Many have chosen to invest in marijuana stocks in the US, which has been experiencing turbulence over the past 2 years, albeit still being viable options as they have long-term potential for growth.
However, experts say that the virus pandemic creates an unexpected twist to past projections as it affected the economy in a tremendously negative way. With regards to the marijuana sector, one of the main effects of the pandemic is a spike in demand and sales, especially at the beginning when lockdowns and stay-at-home orders, when patients decided to stock up on prescriptions while recreational users gathered products for personal consumption.
The Advantages of Getting Investors
The current and future successes of the sector have the potential to benefit your dispensary business, especially if you get the right investor to support your business. If you are not sure how having an investor can be favorable to your business, here’s what you need to know:
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Additional Funding
Stocks are units of ownership in any business. When you sell stocks, stockholders are part owners of the company. The potential for earning is one of the most attractive potentials of any stock, as investors are buying stocks of your business in the hopes of cashing in on the profits while also supporting small businesses.
With this, the primary advantage of onboarding an investor into your dispensary is that they provide additional funding to your company in exchange for units of ownership in your business. You can use this supplementary money for research and development, especially if you want to carry high-quality products or if you want to source from popular suppliers.
Essentially, you can use this fund to increase the potential of your dispensary to earn high revenues. Because investors are part-owners of the company, they are entitled to part of your revenues if they go onboard as a revenue-based financer or financers who do not hold any stocks but provide funding in exchange for a percentage of the revenue. If they are stockholders, they will receive their part of the money should you decide to sell your company.
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Experience and Expertise
Your investors are not merely people behind the scenes who provide more money. They are also entrepreneurs who want to make sure that their investment will pay off. Because of this, they will contribute their experience and expertise to help the dispensary become more successful. Keep in mind that they are part owners, which means that they can have a say in the execution of the business unless your agreement states otherwise.
One thing to consider about getting investors because of the experience and expertise is that you might find points of disagreement that could be difficult to navigate. Because they are your own part of the company, you will need to consider their ideas and assertions.
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Strategies for Expansion
Investors accumulate wealth by investing their existing money into other ventures like yours. Those who have extensive experience tend to have a comprehensive network, which you can tap into for various parts of the supply chain. They may know a reputable company that can provide you with sustainably sourced packaging or other aspects of your business.
Moreover, if your investors see that your dispensary is gaining traction, they can tap into their network to find additional investors, if you are still selling stocks. This is a great way to gain more funds for expanding your business. You can add another location or work to produce your own products. You can also use this money to add products to your current menu.
How to Effectively Use Cannabis Marketing to Get Investors
Now that you know the advantages your dispensary can enjoy when you get investors, you might be wondering how you can achieve this using marketing. Remember that marijuana marketing can help you in many aspects of your business, especially as it can help promote your products to show your earning potential while establishing your company as a favorable addition to prospective investors’ portfolios. Below are some ways to use marketing to attract investors.
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Establish a Strong Brand
A business’ brand is the image and message you want to convey to the market. For example, many companies want to show their companies as a customer- and environment-friendly one. To pursue this goal, they build a brand that reflects these values and ideas. Your entire branding will be represented by your company name, logo, tagline, message, and values.
The thing about brands is that they can drive the value of your business and products up. Just look at the price tag of a high-quality t-shirt with the name Nike on it compared to the price of almost the same quality shirt not released by the brand. The branded shirt is significantly pricier than the non-branded one, despite having a similar quality.
This is because the brand itself is a guarantee. You want to make sure that every time consumers look for top-notch products and excellent service, they will be assured that they can get it from you instead of taking risks from a different store or brand.
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Switch to Digital
Now, your brand is primarily conveyed by your items and your physical location. However, you should remember that we now live in the digital age. Combined with the limitations posed by the pandemic, digital options are becoming more and more favorable because it is more convenient for consumers. They can simply place orders and they can get their products right at their doorstep. Same-day deliveries and curbside pickups are also in.
These orders can be placed online, which makes it a preferable option in light of safety rules imposed due to the pandemic. Where will your customers view your menu and place their orders? Your website, of course!
This is why you should work to build a website that shows-off your brand. Customer-friendliness and accessibility are some of the most important parts of a brand, which means that your website should be able to show this, as well. In short, make sure that your site is consistent with your brand in every aspect.
Your website can also serve as a marketing tool that can drive up your sales. You can do this using cannabis SEO. Think of the times you went on Google to look for a service provider near you. Upon entering your query, you get a list of webpages that can give you the thing you need. Usually, you end up clicking on options on the first page. Your website can reach the first-page using search engine optimization or SEO.
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Build a Positive Reputation
Your reputation can influence whether investors will take a chance on you or not. After all, these businesspeople avoid associating with companies that could tarnish their own brands. Moreover, they would not want to bet on a dispensary that is getting the ire of its consumers, as it can indicate potentially poor performance.
Because of this, you want to make sure that your reputation is generally positive. Combined with high sales with the help of digital marketing and the favorable reception of your brand, a positive reputation will be a great asset in the eyes of potential investors. You can manage your rep through various means including a traditional public relations strategy and a more modern approach with more digital marketing tools.
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Explore Cannabis Social Media
Did you know that you can join cannabis business social networks to connect with potential customers and investors? Platforms such as Weedable, Leafwire, WeedLink and MJLink can help you connect with customers (business-to-consumer or B2C) and other businesses including investors (business-to-business or B2B). Some even combine consumers in businesses in one site, allowing you to create your own network.
The Bottom Line
Marijuana marketing is a great way for your dispensary business to get investors. With the effective and efficient use of traditional and digital marketing techniques and tools, you are bound to connect with a financer that can help you gain more funds, develop your business, and expand your offerings. For a surefire strategy, you can work with a cannabis marketing agency.