The Cost of Going it Alone
February 8, 2021
February 8, 2021
Why would you need a cannabis consultant?
Contributing writers: Greg Huffaker and Garrett Cropsey
So you want to start a cannabis business and, almost as soon as the thought first crosses your mind, people start coming out of the woodwork saying they can help you with this or that and that you “absolutely need to hire them to succeed.” But why would you even need a cannabis consultant, right? I mean, you’re smart, you’re capable, maybe you’ve started businesses before, and you have plenty of time and enough money on your hands to get this done. Really, how hard could it be to learn what you need on your own?
The answer: very hard to do at all, and even harder to do successfully.
First and foremost, cannabis is a compliance-focused business, with a side of selling plants. And not just run-of-the-mill compliance, but compliance in a way you likely haven’t experienced before. There are tight windows of opportunity you have to be prepared to act within. There are terribly written laws that contradict each other on both the state and municipal level, all of which you must somehow follow. There are significant cash expenses you must make—all taking place before you even know if you get a license.
Cannabis consultants have seen the development of the industry and know first-hand of the challenges faced by the industry as a whole as well as those within the state or even municipality in question. The best consultants have evolved alongside the rapid expansion of the industry and have a sense of where it’s headed as a result.
Great cannabis business advice two years ago could very well be business-ending advice in 2021, and today’s advice will be the same in 2023.
Combine that with how much snake oil is out there, and you’ve got a quagmire to sift through, and that sifting alone amounts to more than a full-time job.
It surprises newcomers to the industry just how much the biggest, oldest, and most-established cannabis companies still use consultants.
It is not because they are lazy or uninformed, it’s the opposite: they are hard at work focusing on their core responsibilities and skillset, and realize it’s actually less costly in the long run to hire specialists rather than specialize themselves.
Here are just a few of the expenses smart entrepreneurs could avoid by using a cannabis consultant:
- Application rejection due to missing materials, such as when people are unaware of addendums to applications.
- Low-scoring applications that do not lead to licenses due to the use of old or incorrect information obtained on the internet or from rusty industry operators.
- Loss of business license due to a failure to build-out one’s facility within a state’s mandated timeline.
- Catastrophic unforeseen capital expenditures due to commercial contractor oversight while building an industrial facility.
- Unusable buildings due to failure to properly account for factors like water flow.
- Loss of license due to compliance violations committed by poorly trained employees.
- Loss of license due to failure to file proper documentation, often due to a lack of properly instituted standard operating procedures.
- Out-of-date business methodologies that may “make sense” but lack the data to actually maximize products (hint: many cultivations grow plants far too long, and many dispensaries let product degrade on the shelves far more than they should).
- Greatly reduced exit price due to easily fixable issues an industry professional would cure before buyers came sniffing.
The cost of going alone is a cost that will impact every step of your business, every day of the week. Cannabis professionals have learned from their experiences specific to the industry how to maximize efficiency and profits while remaining in 100% compliance, today, and into the future.
Don’t let a dollar “saved” on consultants turn into the loss of millions of dollars or worse — your license!