The cannabis industry has been showing steady growth in recent years, especially as more states continue to legalize cultivating, selling and using cannabis products. As such, this presents an exciting time for business enthusiasts to leverage the opportunity that lies in the cannabis space. However, it is important to keep in mind that you are entering a highly regulated landscape both at the state and county levels. If you are to set up your business for growth and success, then you must strive to launch and run your business compliantly. In this article, we provide a detailed guide to help you launch a compliant cannabis company.
The importance of compliance in the cannabis industry
Compliance with the state and local laws plays an important role in the success of your business in different ways. These include:
- Avoiding legal consequences
It’s only a matter of time that the authorities will catch up with you if you fail to comply with the laid down regulations. And the consequences can be dire, from facing criminal charges, paying hefty fines to having your business license revoked.
- Building business reputation
Getting on the wrong side of the law can taint your business image significantly. And, this can result in customers losing trust in your weed business. On the other hand, staying compliant showcases how committed you are in offering safe weed products for your customers. This catapults your business reputation, which is instrumental in driving sales and business growth.
A detailed checklist for a compliant cannabis business
Below is a detailed guide of what you need to pay attention to ensure that your weed business starts and stays compliant.
Licensing and permits
Like any other business, you will need to get licensing in order to do any cannabis related business. Since cannabis is not legalized at the federal level, licensing requirements vary from state to state and sometimes county to county. The requirements needed also depend on the type of business that you want to do, whether cultivation, retail or manufacturing edibles and the like.
In addition, you need to follow your state’s standard procedure when applying for licensing. For instance, if you are in California, you need to make sure that the area you plan to open your cannabis business isn’t restricted for commercial cannabis activity before submitting the application documents. In fact, a proof of legal right to set a business in the location must be provided.
Licensing extends to individuals working or volunteering in a cannabis business environment for some states. In Nevada, every employee must acquire a Cannabis Agent Card from the Cannabis Compliance Board to be allowed to work.
Product testing
Product testing is something you can’t ignore if you are to run your cannabis business compliantly. Besides providing safe and high quality products for your consumers, it is a legal requirement in some states. In Colorado, for instance, product testing is mandatory in a state regulated lab. Anyone conducting business in the state must ensure that the products undergo various testing that include potency, microbial, pesticides and residual solvent analysis among others.
Employee training
Adhering to state and local laws pertaining to cannabis business extends to your employees. Keep in mind that these are the people who help you practice compliance. It is crucial that they understand all the rules and regulations to minimize occurrences of non-compliance and risks to your business.
The training should also include equipping the employees with proper knowledge on how to handle cannabis products. The employees should also understand all the cannabis products including their effects on the body and consumption methods. This equips them to help consumers in making informed decisions on their purchases and cannabis use. In addition, include topics on proper record keeping procedures to ensure that the documentation tracks everything for easier monitoring.
Security measures
Due to the high value and sensitivity of cannabis products, security is regarded highly in weed businesses. Ensure that you follow not just your state, but also county security requirements for running a cannabis business.
You need to provide adequate security for your products whether at the grow site, during transportation and at the dispensary. Most states require that the business environment be secured with cameras and alarm systems all around the site, including at the entrances and storage areas. In addition, any security incidents must be recorded adequately and reported to the authorities as soon as possible. Security measures in cannabis business also include vetting employees before hiring and restricting access to cannabis products.
Marketing regulations
Marketing your cannabis business is important in setting your business up for success. However, you need to understand the regulations surrounding promoting cannabis businesses and products in your state and locality. For starters, keep in mind that advertising at the federal level is highly prohibited. Also, advertising to children and people less than 21 years of age can land you on the side of the law. As such, using some colors and images in your advertising materials might not be allowed. In some states, businesses are required to submit their marketing materials to the governing bodies for approval before publicizing them.
Packaging is also a very important part of marketing cannabis products. However, you need to adhere to cannabis packaging regulations in your state. Make sure that product labeling is done according to the requirements. Your state could also require child-proof packaging for cannabis products. Due to the complexity of cannabis packaging, it is good to work with an expert that can offer guidance for all your cannabis packaging needs. A cannabis packaging expert will help you select the colors and images while ensuring proper labeling that adheres to your state’s regulations.
Conclusion
Diving into the cannabis industry can be a smart move in your business career. As the industry continues to grow, starting a cannabis business allows you to cash in on the opportunity. However, you must make sure that you are doing so compliantly to raise the odds of success. Running your cannabis business compliantly not only keeps you at the right side of the law, but also elevates your business image on your customers. Make sure to follow the above guide to make sure that you stay compliant in different elements of running your cannabis business.
