Times are changing. After the 2022 elections, 21 states and the District of Columbia have made cannabis legal for adult and medical use. And that’s just a start.
The global market has now reached $16.7 billion, with an annual growth rate expected to be over 25 percent in the next seven years.
For anyone thinking about a startup in the cannabis industry, it’s hard to ignore the potential.
Most challenges can be handled by following small business and startup advice. You can find business information to help you manage many of the challenges you face, from hiring employees to marketing your business.
Yet many cannabis businesses forget about one essential task that separates them from other businesses: compliance. Compliance isn’t optional. Compliance doesn’t come naturally. It’s critical to your business’s success; you could easily lose your business without it.
Why compliance is important
Compliance is vital for two reasons:
- To safeguard your business and keep it operational
- To protect the investment you’ve made in your business and help maintain its value
State and local regulators keep a watchful eye on cannabis businesses because of their newness. Getting your license and keeping it valid shows regulators that you’ll do what it takes to stay within the guidelines set by the state.
By doing this, you will create efficient operating guidelines over time. Every procedure will lead you to identify what it takes to comply. A solid compliance strategy will help establish effective practices that will show up in how you operate your business.
Two key business challenges facing cannabis businesses
Cannabis businesses face the same challenges as other startup and high-growth companies. Yet two critical issues licensed cannabis operators face daily are security and risk management. Most operate with broken security models piecemealed together over time. They’re expensive, ineffective, and often break easily, letting malicious behavior happen quickly. These challenges include:
- Costs – setting up security and risk management programs is expensive, especially in startup mode.
- Risk – if you don’t have an effective system in place, you’re more likely to face problems. This can impact every level of business, and create liabilities that affect employees, customers, directors, and investors.
- Compliance – building on the fly means you’re more likely to install systems that don’t meet compliance regulations. This can be a costly mistake.
Compliance should always take a holistic approach.
Start by examining the company as a whole. Evaluate every aspect, including where risks lie. This isn’t just about regulatory obligations; the more you secure every element, the more value you add to your business.
From the physical side, it’s all about daily operations. Compliance should include:
- Maintenance and operations
- Standard operating procedures for all aspects of the business
- Product handling requirements
- Physical security protocols
- Employee training
Managing and reporting also become a crucial part of the process. This is where violations and penalties can add up quickly. Don’t skirt issues or choose to ignore them. The best approach is always handling it the right way the first time.
At every turn, you’ll discover one more piece of the puzzle. This is where systems come into play. Utilizing the available tools and appropriate procedures and programs to help you build as you grow will reduce your liability overall.
And create a strong business that will stand the test of time.
For IT Strategy, Security and Compliance, or Help Desk Services, reach out to us at Cannabis Technology Partners 360-450-4759.
