{"id":578,"date":"2018-12-10T17:07:47","date_gmt":"2018-12-10T17:07:47","guid":{"rendered":"https:\/\/www.performancesuretybonds.com\/blog\/?p=578"},"modified":"2022-01-24T16:04:27","modified_gmt":"2022-01-24T16:04:27","slug":"cannabis-industry-insights-predictions","status":"publish","type":"post","link":"https:\/\/www.performancesuretybonds.com\/blog\/cannabis-industry-insights-predictions\/","title":{"rendered":"Cannabis Industry Insights and Predictions for 2019"},"content":{"rendered":"

The cannabis industry in California is still fledgling, yet many are looking to get a piece of the booming legal marijuana market. From Humboldt County to San Diego, entrepreneurs and big businesses are facing off to claim their stake in the face of many regulatory and economic unknowns. In order to shine some light on what cannabis dispensary trends are taking flight, we reached out to several industry leaders and got their feedback on a range of dispensary-related issues.<\/p>\n

Vertical Integration is Where It\u2019s At<\/h2>\n

Chelsey Moter, CEO of Cannack.com<\/a><\/u> contributed that businesses that can handle all sides of the process, from cultivation to sale, are ahead of the game:<\/p>\n

\u201cWith legalization and regulation of cannabis in California, flower and products in dispensaries are limited and retail prices are sky high. However, businesses that are vertically integrated and hold multiple licenses such as cultivation, manufacturing, distribution and retail are able to control supply, reduce cost and offer their brand at a lower price point to the end consumer. Dispensaries with this kind of internal organization are going to be the most profitable and the biggest type of assets to holding companies and investment firms.\u201d<\/p>\n

Moter also gave a grim outlook for \u201cBig Cannabis\u201d becoming oligarchical, adding, \u201cIt’s just like the agriculture and meat industry where individual farmers supplied their own communities at first and then eventually, they were bought out by larger corporations. Now, we pretty much have 5 companies that control the entire supply for the US.\u201d<\/p>\n

Taking It to the Bank<\/h2>\n

One of the biggest setbacks for businesses looking to grow in the cannabis industry is the lack of federally-insured banking opportunities since cannabis is still a Schedule One drug. Hazim Alaeddin of WeedUpdate<\/a><\/u> has a more optimistic look for the state of cannabis banking in 2019:<\/p>\n

\u201cThe biggest legal trend coming in 2019 is that banks will finally be able to deal legally with dispensaries. Right now, they operate on a cash basis, which is very dangerous for all of them. Or they work with credit card merchants that they are deeming as \u201chigh risk\u201d and charging them exuberant amounts in transaction fees. So even though it is legal in California to sell cannabis and CBD, banks are regulated by the federal government, and both remain illegal under federal law. However, President Trump has said that he will lift the federal ban on cannabis after the mid-term elections.<\/p>\n

\"marijuana<\/p>\n

You can find that source on WeedUpdate.com here: https:\/\/weedupdate.com\/2018\/10\/15\/common-sense-and-legal-weed\/<\/a><\/u> with a quote from Congressman Dana Rohrabacher.\u201d<\/p>\n

A New User Experience<\/h2>\n

The way that cannabis consumers buy products and interact with them is changing, with packaging and branding playing an essential element to the success of a product. Garyn Angel, CEO of MagicalButter<\/a><\/u> and renowned cannabis expert stated, \u201cThe 2019 dispensary trends is all about design. Brands are growing at exponential rates as legalization becomes a reality putting out beautifully packaged products. Dispensaries are opening near high-end neighborhoods and buying cannabis is now an immersive experience.\u201d<\/p>\n

\"marijuana<\/p>\n

Bert Miller, CEO of Protis Global<\/a><\/u>, a leading executive search firm within the cannabis industry, also contributed his thoughts toward the ever-changing world of cannabis user experience:<\/p>\n

\u201cThe biggest trend for dispensaries will be the shift in the consumer\u2019s buying experience. This trend is already actively occurring in cannabis – ultimately, the industry will set itself up similarly to the adult beverage industry. The 3-tier system (which is how the adult beverage industry is structured) seems to be the most logical distribution channel for cannabis to mimic. Eventually, and most likely sooner than you might think, cannabis products will be thought of as another fast moving consumer good (FMCG).\u201d<\/p>\n

Miller went on to note that the specific trends that will follow this change toward a more accessible cannabis market include developments in product organization, branding\/in-store advertisements, and user experiences that more closely mimic traditional retailer visits.<\/p>\n

Surety Bonds for Cannabis Businesses<\/h2>\n

Surety bonds are often used in the cannabis industry to help ensure that business owners and managers are provided with satisfactory work by contractors. Thomas C. Buckner, Executive Vice President and Senior Underwriter of Viking Bond Service, Inc, gave the following overview of the role of surety bonds in the cannabis industry:<\/p>\n

\u201cViking Bond Service, Inc. provides surety bonds both for the permitting and licensing requirements related to the Cannabis and MMJ industry. As States continue to add legislation to govern the Cannabis\/MMJ industry it is important to have a surety professional that that understands the laws in this evolving industry. Viking has specific programs in place to address the growing number of Cannabis\/MMJ operators as these needs arise. \u00a0As the Cannabis market expands so will the need for new infrastructure project to address the demand, such as grow operations, security, logistics and dispensaries and many of the projects will require Bid, Payment and Performance Bonds.\u201d<\/p>\n

\"marijuana<\/p>\n

Sophistication and Nuance<\/h2>\n

Adriana Herrera, founder and CEO of EpicHint<\/a><\/u>, a company which provides automatic training for the cannabis industry, highlighted that 2019 will be the year of refinement for the cannabis industry:<\/p>\n

\u201cA huge trend we’ll see in 2019 is the level of operating sophistication lift\/ increase. Dispensaries are not inexpensive ventures to run and not all dispensaries reach profitability. The profitable dispensaries invest time and resources into operational infrastructure as much as they do inventory.<\/p>\n

Anyone looking to open a dispensary should understand that the sale of cannabis is nuanced. The dispensaries that do well are the ones that understand the nuances of cannabis and how to run a retail business. Successful dispensary operations are part science (knowledge, selecting the right inventory, and operation) and part art (differentiation points and ability to retain customers).\u201d<\/p>\n

Compliance is Key<\/h2>\n

Jamie Garzot, CEO and founder of both 530 Cannabis<\/a><\/u> and Synergy<\/a><\/u>, cautioned that many dispensaries and manufacturers in California are struggling to keep up with regulations, which can differ between jurisdictions. Garzot also estimates that the variety of products on her shelves has been reduced by at least 50 percent because many manufacturers were unable to make the changes necessary to be compliant.<\/p>\n

The dispensary owner, who started her successful businesses with a paltry $7,000 investment, notes that the pipeline of legal products is far from full\u2014there are fewer options and short-shipped orders are the new norm. \u201cMany of our customers dislike the new, pre-packaged products and the illicit market offering the loose flowers customers prefer seems to be growing,\u201d she said.<\/p>\n

With all of the changes coming to the world of cannabis dispensaries, it can be hard to stay on top of the latest news. Visit our blog<\/a><\/u> often to stay ahead of the latest trends!<\/p>\n","protected":false},"excerpt":{"rendered":"

The cannabis industry in California is still fledgling, yet many are looking to get a piece of the booming legal marijuana market. From Humboldt County to San Diego, entrepreneurs and big businesses are facing off to claim their stake in the face of many regulatory and economic unknowns. In order to shine some light on … Continue reading “Cannabis Industry Insights and Predictions for 2019”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":579,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[86,43],"class_list":["post-578","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","tag-california-marijuana-bond","tag-marijuana-surety-bonds"],"yoast_head":"\nInsights & Predictions for the Cannabis Industry in 2019<\/title>\n<meta name=\"description\" content=\"In order to shine some light on what cannabis dispensary trends are taking flight, we reached out to industry leaders in California. 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