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4 Ways to Achieve Longevity in the Cannabis Business

The industry is a marathon, not a sprint. Here's how to finish strong.

Opinions expressed by Entrepreneur contributors are their own.

All signs point to 2021 being the year to place your bets on cannabis. With the recent legalization measures in several US states and the reclassifying of cannabis by the United Nations, the industry's stigma is diminishing at an ever-increasing rate. This has encouraged legislators to hasten its legalization at the state level (where it is not already fully legal), and more importantly, at the federal level, where there appears to be a change of heart toward cannabis that followed the new administration into power. While we evolve at a staggering rate, both newcomers and industry veterans will need to focus on longevity and a healthy growth plan to succeed.

As we head into one of the most exciting years for our industry yet, here are our essential tips for success:  

Refine your knowledge

Cannabis is popping up everywhere - and is available in nearly everything you can eat, drink and put on or in your body, becoming the hottest commodity of our generation. This means professionals from numerous non-cannabis industries are showing interest, often with the assumption that their experience will translate to a successful brand. But there are nuances in the cannabis industry that often trip up even the most experienced executive new to this industry.  

It's essential to do your homework and understand all aspects of this highly interconnected industry, from the plant itself to cultivation to the manufacturers, and eventually, the consumers. The power of knowledge remains essential in the inner workings of cannabis companies obtaining longevity.

Diversify your team's skillset

Cannabis companies that achieve success have diversified their leadership teams with experts from various domains, including science, medicine, and food—not just cannabis. These brands have strategic strength and staying power. 

Branching out and seeking these specialties can have a profound impact on gaining a broader perspective on your brand's potential, and ultimately, your market share. By ensuring a diverse set of skills in your team, you will increase your brand's longevity as the industry's landscape evolves. 

Strive for multi-vertical integration

When I first moved into the cannabis space, I was opposed to vertical integration for several reasons: owning cultivation infrastructure was daunting, capital-intensive, and inefficient. But I've come to appreciate that there is value in owning and controlling multiple elements of the supply chain. I've realized that achieving multi-vertical integration (downstream of cultivation) is an alternative and more attainable goal and eliminates a brand's reliance on a third party's success.

In a nascent industry like cannabis, companies that integrate multiple aspects of the supply chain into their business models have a greater likelihood of success than those who don't. Owning multi-verticals, such as manufacturing, distribution, and retail infrastructure, all under one umbrella, creates self-sufficiency and greater control over a brand's destiny.  

Attain a blended corporate culture

We are now facing a new age of cannabis, where the support of an established Consumer Packaged Goods (CPG) player can be the determining factor for a cannabis brand to evolve. CPG parties, however, are notoriously unaware of the ins and outs of cannabis values, so much so that they often result in little (to no) appreciation for the spirit of the plant, and ultimately, do not understand what experienced cannabis parties offer. The challenge, however, is blending a more disciplined CPG approach to the ritualized legacy of cannabis culture.

For any modern cannabis company to secure longevity and growth, they must face this tension and commit to finding the balance of these otherwise dichotomous approaches. By attaining synergy between the cannabis professionals and the CPG players, your cannabis brand will ensure a blended culture, and ultimately, a healthy growth plan. 

By implementing these four steps, your business has a greater chance of overcoming the many challenges that defeat well-intentioned cannabis companies today.