Considerations for Opening a Dispensary or Building a Cannabis Facility

Higher Yields Consulting Considerations for Opening a Dispensary or Building a Cannabis Facility

As more states create cannabis programs, expectations and standards are becoming more defined, but there’s still a lot of uncertainty in the industry. Whether you’re opening a dispensary or building a cannabis facility, just getting started can be harder than you think.

As we learned from a recent expert panel on the Business of Cannabis, the majority of aspiring cannabusiness owners greatly underestimate the amount of time, resources, and funding they’ll need to get off the ground.

Higher Yields Consulting Considerations for Opening a Dispensary or Building a Cannabis Facility

Because each state is different, the panel experts advised that anyone interested in opening a dispensary, cultivation, or extraction and manufacturing facility start by carefully reading their state’s regulations and rules. Then, take advantage of every available resource, including professional guidance. 

Read on for more key considerations about the business of cannabis for anyone interested in opening a dispensary, launching a cultivation, or building an extraction and manufacturing facility.

How to Save Failing Social Equity Programs 

Historically, social equity programs haven’t had much success. Most applicants simply don’t have the resources to compete against big multi-state operators (MSOs), and are often taken advantage of as a result.

Since MSOs control the price, they control the product. The key to improved social equity programs, then, boils down to properly allocated funds, education, and resources to help small businesses and minorities band together against MSOs. 

There are two approaches to accomplish this. First, state governments can create incubator periods with designated facilities to provide each social equity applicant with the education and experience needed for successfully opening a dispensary, cultivation, or extraction and manufacturing facility. 

Second, on a more local level, towns and municipalities with existing MSOs can use the money gained from those MSOs to train and support social equity operators while amplifying those operators’ own voices. 

Cannabis & the Workplace

Regardless of whether you’re opening a dispensary, building a cannabis facility, or overseeing employees at any other type of cannabusiness, it’s important to understand that the legalization of cannabis has prompted new questions about regulating employee consumption. 

To help keep workplaces safe for all, employers will need to update company policies with cannabis-specific language and train current and future employees on the appropriate procedures. 

Considerations to address include:

  • Dignity & privacy: Considering how long cannabis remains detectable in a person’s system, understand the circumstances under which you are allowed to test, and how to conduct tests with respect to employees’ privacy. 
  • Testing & reports: When and how will tests be conducted? What actions will be taken if there are positive tests, reports, or accidents on the job? Spell out expectations and procedures as clearly as possible. 
  • Offsite prohibitions: Understand what restrictions employers can and can’t enforce on the use of cannabis when employees are not at work, especially if the employees have medical reasons for consumption.
  • Medical use: While employers are not required to allow cannabis use onsite — even for medical purposes — certain accommodations may be needed to address the reason an employee has been prescribed medical cannabis.
  • Working from home: This is an extremely gray area, as cannabis use while working from home is difficult or even impossible to detect and enforce restrictions on. 

Ultimately, employers who actively engage with cannabis policies and listen to their employees’ needs and concerns will be best equipped to cultivate a safe and comfortable working environment. 

Introducing Cannabis to the Community

Cannabusinesses have enormous potential to benefit local economies by bringing in new business and real estate revenue. However, many municipal officials, landlords, and communities maintain closed-off attitudes toward the industry and treat cannabusiness differently than other small businesses.

Higher Yields Consulting Considerations for Opening a Dispensary or Building a Cannabis Facility

Despite state-level legalizations, cannabis is still federally illegal, and some people simply won’t be open to it as long as that’s the case. But while certain communities may never fully embrace the industry, others will open up in time as they see its positive effects on neighboring municipalities. 

In the meantime, if you’re serious about opening a dispensary or building a cultivation or extraction and manufacturing facility in your municipality, the best thing you can do is start making connections with local officials, help correct misconceptions, and educate your community about the benefits of cannabis. 

Section 280E: The Cannabis Industry Stumbling Block

One of the biggest hurdles for anyone considering opening a dispensary, cultivation facility, or other cannabusiness is finances, especially taxes. 

Cannabis is still considered a Schedule 1 controlled substance, so according to Section 280E of the Internal Revenue Code, cannabusiness owners are unable to take typical business tax deductions or credits on the income gained from cannabis sales. 

However, while no one can avoid Section 280E, there are still many tax deductions that cannabusiness owners can and should take advantage of. Taxes aside, there are plenty of financial resources available online, from events and conferences to expert consultants. 

If you are considering opening a dispensary, cultivation or manufacturing facility, or any other cannabusiness, be sure to research financial opportunities thoroughly, keep your records in order and above reproach, and take every tax deduction you can. 

Cost of Opening a Dispensary or Cannabis Facility

So what does the process of opening a dispensary, launching a cultivation, or building an extraction facility look like, and just how much money do you need? 

While costs vary greatly, opening a dispensary can cost between $150,000 and $8.5 million. Setting up a cultivation facility typically costs around $400 per square foot, plus operating expenses. Building an extraction facility can cost anywhere from $8,000 to $1 million, depending on the processes and equipment used. 

The process of opening a dispensary is often fairly quick and straightforward, but building an extraction or a cultivation facility may involve higher equipment costs and, sometimes, frustrating delays. 

For those who can’t afford steep setup costs, a few states offer the alternative to start out as a microbusiness and potentially convert to a bigger business once established. Starting a microbusiness carries the same degree of difficulty as any other business, but it comes at a much smaller cost of entry and could be a viable option for some. 

Start Preparing Now

Despite the challenges of getting started, the cannabis industry is ripe with potential for those who are able to follow due processes. If you’re considering opening a dispensary, a cultivation facility, or another cannabusiness, don’t wait — even if your state’s program isn’t open yet, you don’t want to fall behind. 

Starting up a cannabusiness is not easy money. To be successful, you need to understand how to run a business in this specific industry, and for that, you’ll need expert guidance every step of the way.

Ready to start laying the groundwork for your own cannabusiness? Reach out to us to schedule a consultation today.

New Developments for Cannabis in Europe

Higher Yields Consulting New Developments for Cannabis in Europe

Developments for cannabis in Europe appear to be about five to 10 years behind those in North America. It’s slow going, and while some European countries have legalized the use of cannabis, others are still not quite there.

Higher Yields Consulting New Developments for Cannabis in Europe

This creates an interesting dynamic where countries that aren’t yet on board with cannabis legalization may have difficulty policing the transport of cannabis over the border from those that have legalized it. 

Read on to learn more about new developments for cannabis in Europe. 

What’s New for Cannabis in Europe

Legislation for cannabis in Europe may be comparatively slow to develop, but we have seen some movement that indicates continued growth in the near future. Here are seven countries making headway in cannabis legalization.

Luxembourg

Having pledged in 2018 to create an adult-use program by 2023, Luxembourg has recently proposed legislation that would allow adults to keep up to four cannabis plants in their homes or gardens. 

Although the country was not the first European nation to legalize cannabis as initially anticipated, they’re still among the first to set this kind of legislation in motion. 

Germany

Germany has also recently announced plans to legalize cannabis for adult use, though details about specific regulations are still in flux. 

Since there is also talk of Germany becoming the first European nation to legalize the sale of adult-use cannabis, the country has potential to become one of the bigger importers and distributors of cannabis in Europe.

Malta 

The tiny island country of Malta was actually the first in the EU to legalize adult-use cannabis, which it did on December 14, 2021. 

The legalization allows for home grows of up to four plants, but does not permit public consumption or carrying more than seven grams of cannabis. Still, it’s a historic move that may influence progress in other European countries.

Spain

While cannabis is largely illegal in Spain, cannabis clubs have been generally tolerated, and the country is one of the largest producers of cannabis in Europe. 

Recently, however, legislation has been proposed for the legalization of medical marijuana in Spain. Whether the proposal will succeed remains to be seen.

France

In March of this year, France legalized medical cannabis and has been in the midst of medical trials since 2021.

Higher Yields Consulting New Developments for Cannabis in Europe


Any progress on the adult-use front is still very slow moving. 

UK

Neither medical nor adult-use cannabis is legal in the U.K. at this time.

Although the mayor of London, Sadiq Khan, recently set up a drug commission to discuss legalization, there’s not a lot of movement just yet.

Portugal

Portugal was among the first EU nations to legalize medical cannabis in 2018, and now, it looks like the country is on its way to legalizing adult-use, as well. 

That said, exact legislation and regulations have yet to be defined.

Looking Ahead

In some ways, the approach to cannabis in Europe is similar to that in the U.S., with some countries legalizing cannabis and others not yet, just as some states have legalized it and others have not. 

To better control black market operations, the EU will likely need to step in and set preliminary regulations around international trade and transport. Setting high standards of regulation would help cut down on black market growth and establish more sustainable programs for cannabis in Europe. 

Additionally, similar to Canada, more progressive attitudes toward health care could help medical cannabis act as a stepping stone to full legalization. 

Slow but Steady

While cannabis in Europe may be moving slower than in North America, that position also gives European programs the ability to learn from U.S. and Canadian developments and start their cannabis economies off strong. We anticipate a fairly smooth transition into legalization from here.

Looking for more updates on the cannabis industry? Visit our website today.

Benzinga: Navigating Increased Industry Complexities

Higher Yields Consulting Benzinga Cannabis Event Takeaways for Navigating Increased Industry Complexities

As a learning organization, we’re always on the lookout for new industry trends and challenges to help cannabusiness owners excel. To that end, we recently attended a Benzinga cannabis event so we could learn more about upcoming changes and add more value for our clients. 

What we learned at this cannabis event presents a reality check to the entire cannabis industry. There’s a transformation happening in that this already-complicated industry is getting even more complicated, and the psychedelic industry is adding new complexities on top of it all.

Higher Yields Consulting Benzinga Cannabis Event Takeaways for Navigating Increased Industry Complexities

But these challenges are not without their opportunities. With the right partners and an understanding of existing and emerging challenges for this ever-shifting industry, there’s plenty of potential for growth. 

Here are our top three takeaways from the Benzinga cannabis event to help you navigate new developments and potential complications.

Psilocybin: Psychedelics vs. Cannabis

Our first day at the cannabis event had us learning about psilocybin and the emerging psychedelic market. Shark Tank judge Kevin O’Leary spoke about his plans to invest in psychedelics but not cannabis, citing the psychedelic industry’s intent to gain FDA approval for medicinal use right away. 

This, when approved, will drive institutional funds into the psychedelic market. Meanwhile, O’Leary predicts the cannabis industry will become a commodity-based industry in just two years.

These side-by-side discussions of psychedelics versus cannabis were eye-opening to say the least. If you think of the two substances in terms of plants versus mushrooms and consider the stigma surrounding both, they almost seem to be cousins — related, but different. 

However, contrary to what we would have predicted, the two industries appear to be heading down completely separate paths. Instead of partners pushing progress together, the industries are emerging more as competitors and will likely put pressure on each other to raise the bar or be left behind.

Identifying & Securing Capital Partners

The second eye-opener of this cannabis event was a look back at just how far the cannabis industry has come in a relatively short amount of time, particularly when it comes to the availability of investment funds. 

Just a few years ago, with how aggressive the DEA was in shutting down cannabis operations, it was extremely difficult to find investors. Today, however, there are a plethora of capital vehicles through which to take on debt, sell equity, go public, and so on. 

With that said, there’s still room for improvement, especially for startups. While there is some seed capital available, the majority of people seem to want to invest in established businesses that have either cashflow or actual assets that are in operation.

Higher Yields Consulting Benzinga Cannabis Event Takeaways for Navigating Increased Industry Complexities

With so much progress being made — and so much progress still to be made — there’s a distinct need for partners who can help new and existing cannabusiness owners coordinate all the different entities, partners, and complexities involved in navigating the industry. 

There are a lot of partners out there who specialize in one or two aspects, but without a central hub overseeing the entire process, there’s potential for a huge loss of continuity. That’s why Higher Yields Consulting is committed to helping cannabusinesses grow all the way from concept to operational excellence. 

Filling the Real Estate Gap

Finally, our third takeaway from the Benzinga cannabis event is that when it comes to real estate, most tools and technologies out there are lacking in some capacity or another. 

So far, no other mapping tool on the market is as useful, versatile, or robust as the one we’ve developed for locating green zones nationwide. Those that do exist tend to lack in data analytics and leveraging connections, causing significant delays, or be limited to only one state or region. 

Securing the right real estate is a vital step in securing capital. While other partners aren’t as focused on mapping tools as a service, we believe this technology will lead the industry through finding properties and getting more deals done. That’s why we’ve dedicated so much time and so many resources to its development. 

Bringing Cannabis Event News to You

Through this cannabis event and other learning opportunities, we’re grateful for the ability to stay tuned into the cutting edge of the cannabis industry. 

HYC exists because we’re passionate about cannabis and the good this industry can do in the world. We’re committed to using our knowledge to help cannabusiness owners like you stay abreast of industry changes and complexities throughout your cannabis journey.

For help navigating the ever-changing world of cannabis business development, reach out to us!

How Cannabis Genetics Impact Your Business Strategy

Genetics impact everything about your cannabusiness, from whether you focus more on quality over quantity to your revenue and how you position yourself in the market. A successful cannabis business strategy begins with the end in mind and a commitment to quality in the genetics of your plants.Higher Yields Consulting How Cannabis Genetics Impact Your Business Strategy

If, for example, your end product is flower, the approach you take to genetics should be different than it would be if your end products were extracts and concentrates. 

Read on to learn more about the importance of cannabis genetics and how to create a long-term business strategy that places genetics at the forefront of your planning. 

Cannabis Genetics: A Crash Course 

When we breed plants, we cross male and female plants to get seeds. That’s what we call our F1 generation. But half those seeds will be males that we have to throw out. The other half will be females, but some will take on majority male characteristics, some will take on majority female characteristics, and some will be roughly 50/50. 

As we go through that F1 generation, we ask ourselves what characteristics we want to get from each type — like strong and girthy from the male side, and good-smelling produce with a high THC from the female side, for example. 

Once we weed out the F1 plants with characteristics we don’t want, we’ll take the females from the narrowed-down group and cross them again with the males to get our F2 generation. Of the F2 generation, the males will be thrown out again, but the females will be much more consistent in the characteristics we’re looking for. 

If we were to stop at the F1 generation, the plants likely wouldn’t produce the way we wanted them to or have enough potency. That’s why it’s important to put in the time to develop the characteristics we want through multiple grows. 

Quality Assurance: Start at the End

Your end goal and your plants’ genetics go hand in hand. For example, imagine you have two plants. One tests at 30% THC and gets you two pounds of light. The other  plant tests at 20% THC, but gets you three pounds of light. 

If your goal is extraction, the first plant will be more efficient. But if your business strategy is to sell raw flower, the second plant will produce more biomass and therefore be the better choice. When you know what you’re growing for, you know what characteristics you need your plants to have.

Many cannabusinesses have quality assurance (QA) programs for the back end of their product. Once the product is finalized and trimmed, it passes through QA before being brought to the shelves. But many businesses neglect the QA process for their plants’ genetics — and they shouldn’t. 

Know the Data of Your Plants

QA will give you a more accurate idea of not only what crops you can expect to yield but also the timeline they will need. Indoor growing follows an assembly line, so it’s critical to know how many times you can turn over the space and build that into your business strategy. 

If some plants take 14 weeks to finish flowering and others take eight weeks, you’ll end up having a gap in your assembly line. And any time plants aren’t under the flowering lights, your cannabusiness is losing money.

Higher Yields Consulting How Cannabis Genetics Impact Your Business Strategy

When you understand the data of your plant, you have a better idea of what to expect from it and when you’ll need to fill gaps in the assembly line. Then you can more accurately determine if a given plant qualifies to be brought into your facility in the first place.

For example, if you have 10 feet between the table and the light, you need to know that your plants will only grow to be eight feet tall and not 10. In this way, your plants’ genetics impact everything in your facility, from lighting and space to THC and beyond. 

Fit the Plants to the System

Another mistake we see people make is trying to tweak their system to grow a certain strain in their facility. This is dangerous because when you give certain plants special treatment, you open the door for missed or double doses, pests, and all kinds of other issues. 

Instead of adjusting your system to cater to specific strains, only bring in strains that suit your system. It could be a great plant objectively, but if it doesn’t fit your system, it’s going to take up precious time and resources. 

Genetics & Brand Messaging 

The impact genetics have on your brand and messaging really goes back to the question of quality versus quantity. Do you want to be the Budweiser or the Delirium of cannabis? 

If your business strategy is for your product to be accessible and common, then you’re prioritizing quantity — although, of course, quality always matters. If you’re a high-end brand, on the other hand, quality should be your chief concern. You can demand a higher price for a special, stand-out product.

Also consider what you want your brand to be known for: novelty or dependability. Do you want to be known for your staple products or for bringing new strains to the market? Both strategies work, but they have to be well thought-out. 

You need a solid business strategy from the beginning, detailing how you’ll get to your end goal — be it quality or quantity — and how you’ll make your product resonate with the people you’re trying to bring it to.

The cannabis market is maturing. People do want potency, but they also care about cannabinoids and terpenes. When you factor genetics into your business strategy and can explain to your audience how you are controlling the quality of your plants and the traits you are breeding for, you will stand out from the crowd. 

Start Building a Successful Business Strategy Today

A strong cannabis business strategy starts at the beginning with a solid understanding of how genetics impact your entire business. You need to have a plan in place for every part of the process, all leading to and supporting your end goal. 

At HYC, we understand how cannabis genetics impact your planning and long-term success. Contact us today to learn more and start implementing better quality assurance in your business.

How to Expedite the Cannabis Property Selection Process

Real estate often causes cannabusiness owners to spin their wheels. With short application windows and the need to have contingency plans in place, it’s easy to prolong your search for the right cannabis property.

But finding the right location for your cannabusiness doesn’t have to take forever. If you do it right, you can speed up the process and get to building your business faster. That said, a cannabis property must meet very specific zoning requirements and should thus be approached differently than other kinds of real estate.

Higher Yields Consulting How to Expedite the Cannabis Property Selection Process

To that end, we’ve developed an expedited process to help you find a cannabis property without getting blindsided by common real estate roadblocks. 

Here’s our step-by-step process for finding your cannabis property more efficiently.

Start With the Green Zones

The first thing you need to know is how to choose the areas in which to look for your cannabis property. Many people do this by choosing a city, downloading a list of 1,000 or so properties in that city, and narrowing the list down to 100 properties from there. 

But once they start going through those specific properties, they find that none of them actually qualify as cannabis properties because they aren’t zoned properly. 

We created our green zone assessments for this very reason — because no one wants to settle on a location only to find out their cannabusiness isn’t legally allowed to operate there. Instead, our process starts with establishing where the facility you plan to operate is allowed to be, and then choosing from those locations.  

Research the Requirements

Once you know where your cannabis property can legally exist, do your research to find out what requirements it will need to meet, with special attention to regional and municipal setbacks

Usually, a city will determine setbacks based on how far the property is from a dispensary or how many dispensaries and cannabis facilities can be in a certain ZIP code or territory. But they’ll also dictate how far a facility must be from churches, day care centers, schools, and rehab facilities. 

These kinds of facilities are constantly shutting down and opening up, but the city might only update their green zone map once per quarter — meaning the map can become inaccurate within a week. 

At HYC, we use a number of systems and databases to create our own up-to-date green zone maps with all relevant setbacks factored in. From there, we search for addresses within those areas, giving us a narrowed list of addresses we then verify with the city to determine if they truly qualify to be used as cannabis properties.

Get Boots on the Ground

Once we have our narrowed list of potential properties, the next step is to get out there and physically scope out the area. Sometimes you’ll even find a cannabis property that isn’t in the system because it isn’t for sale or lease just yet.

Higher Yields Consulting How to Expedite the Cannabis Property Selection Process

Don’t be afraid to knock on the doors of qualified properties and ask about the company’s lease and when it expires. But be very targeted in which doors you knock on, otherwise you’ll be wasting your time. 

Above all, you need to have a process. A lot of brokers make the mistake of thinking any property will work and end up whittling down the list of possibilities into locations that in fact won’t. 

Protect Yourself From Real Estate Pitfalls

Even once you’ve found the property, you still need to be strategic as you negotiate with the landlord. Some landlords may try to charge more or create a bidding war once they find out you intend to use the space as a cannabis property. 

Protect yourself when negotiating for a cannabis property with a contingency agreement, which keeps you from being bound to the property if your license application is denied. Contingency agreements can be difficult to negotiate because of the risk they pose to landlords, so you may have to explore creative solutions.

In some cases, you can put the landlord’s mind at ease by putting down a deposit or agreeing to a smaller monthly lease until your application is officially approved. You might even have to give up equity in your business to be able to lock down the property. 

If you’re lucky, you might work with a developer who’s early in their career, has a bunch of properties, and is willing to roll the dice on your cannabis property while they get the others up and going. 

Finding a Cannabis Property Doesn’t Have to Take Forever

Choosing your cannabis property can be one of the most difficult parts of opening up a cannabusiness, especially if you approach it like you would any other type of real estate. But with the right process and tools, you can minimize risks and choose your property efficiently. 

To get expert guidance and a tried-and-tested process, contact HYC for a green zone assessment and to find the most lucrative cannabis property for your business.

What to Expect From the Louisiana Marijuana Program & Other Southern States

Higher Yields Consulting What to Expect From the Louisiana Marijuana Program & Other Southern States

The Bible Belt certainly isn’t known for being particularly friendly to cannabis, but opportunities are slowly starting to open up in certain areas. The Louisiana marijuana program is one example of a small but promising start, and a few other Southern states show limited potential, as well. 

While as a whole, the Southern states are often slow to accept cannabis as anything other than a drug, there have been significant shifts. Florida, for instance, was the first to legalize medical marijuana and open up a cannabis program (albeit an extremely limited one). 

Higher Yields Consulting What to Expect From the Louisiana Marijuana Program & Other Southern States

Here’s what you need to know about the state of cannabis in this hold-out region of the U.S., from the bare-minimum Texas CBD allowances to the small-but-promising Louisiana marijuana program. 

Southern States With Little to No Movement

The Florida, Texas, and Mississippi marijuana programs may have had decent starts but have since stalled for the foreseeable future — or at least the next few years. We’re keeping an eye on them for future developments, but we don’t expect much movement at this time.

Florida 

True to the common conception of Florida as a separate entity from the rest of the South, Florida’s marijuana program is very different from what we see in other states.

Initially, Florida’s program issued only five licenses, though it later opened up a few more. However, Florida’s program is not an open application route, so no one is currently able to compete for licenses in the state. 

Although Florida’s legalization measures helped trigger a domino effect to get the other Southern states moving, it’s likely to be a few years before Florida’s own program picks up any further momentum.

Texas 

Texas does have a medical marijuana program, but the state allows only 1% THC in their medical marijuana products. At such a low THC rate, it’s essentially a CBD program. And it’s very minimal — just over 3,000 patients are registered, and there isn’t much movement happening in the state, overall. 

If you want to get into the Texas market, be prepared to work exclusively with CBD and CBD-adjacent products for a while. Cultivation is another option to consider, but the market is saturated. While we don’t recommend starting out in Texas at this time, if you’re so inclined, manufacturing will be your best bet. 

Mississippi 

In early 2021, Mississippi looked like it would follow in Oklahoma’s footsteps in terms of plentiful and accessible license availability. Unfortunately, however, government and legislative issues have put the program on hold for the next two or three years. 

If you want to build a cannabusiness in one of the Southern states, we’d suggest exploring opportunities in the Arkansas, Alabama, and Louisiana marijuana markets instead.

Southern States With Some Opportunities

The Arkansas, Alabama, and Louisiana marijuana programs offer a few more opportunities, especially if you establish the right connections prior to entering the market there. 

Arkansas 

Arkansas is currently legalized for medical cannabis, and the application window is open. However, the state also has a high barrier of entry. You’ll need expensive surety bonds and to meet strict zoning limits. Once a zone fills its allotted number of dispensaries, no more dispensaries will be allowed to open in that zone. 

Higher Yields Consulting What to Expect From the Louisiana Marijuana Program & Other Southern States

While you can certainly apply for a license in the Arkansas medical marijuana program, know that it will be an expensive endeavor and that you may have better luck with the Alabama or Louisiana marijuana markets. 

Alabama 

Alabama’s Compassion Act will likely resemble Florida’s cannabis program. Although there probably won’t be a low THC cap, it does appear as though operators will only be allowed to sell manufactured products — no raw plant, smoking or vaporization products, or baked goods.

The Act also has a large residency requirement — 51% of all license holders must be Alabama residents — as well as huge capital requirements, making the barrier of entry extremely high. 

If you’re looking at entering the Alabama marijuana market, you’ll want to get started as soon as possible finding real estate and establishing yourself as a local team. MSOs are already moving in, but they’re required to work with local teams, and it will take time to build up those connections. 

Louisiana 

The Louisiana marijuana program kicked off in 2018 with a total of nine licenses. But despite being a small program, it was set up well and there are many lobbying efforts to expand cannabis retail.

However, growth within the Louisiana marijuana program is still slow. Louisiana legislation only authorized the Louisiana State University and Southern University agriculture centers to grow medical cannabis, so you’ll have to contact the Board of Pharmacy regarding licensing to dispense any medical cannabis.

As is true of any Southern State, entering the Louisiana marijuana market is all about who you know and how you advocate locally for cannabis. You can’t just show up and submit an application; you have to play an active role in educating the community and helping write ordinances that simply don’t exist yet.

That’s where HYC comes in. We can help you make important local connections and develop the necessary knowledge base to educate your community. There will always be local political challenges, but with the right knowledge and connections — and an early start — you have the opportunity to impact change. 

Get Your Foot in the Door With Louisiana Marijuana

The Louisiana marijuana program offers a fairly typical example of what to expect in Southern states — slow movement, small programs, and the importance of making the right connections. But if you can get your foot in the door early and weather both political and local delays, opportunity is there. 

Working with an experienced cannabis consultant can give you the credibility, connections, and partners you need to be successful. Don’t miss your chance to get into the Louisiana marijuana market early! Get in touch today to schedule a consultation.

What Is a Consulting Company?

Higher Yields Consulting What Is a Consulting Company

There comes a time for any business owner when you realize that your ambition will only get you so far. In the cannabis industry, in particular, there are uncharted waters around every corner and it requires a team of experts — each contributing value in their own area of specialization — to steer the ship successfully towards the goal. 

As a leader in your business, it’s your responsibility to choose the team members who are going to get you there successfully, efficiently, and creatively so that you can stand out from the crowd and reap the rewards as a team. 

So how do you go about finding those team members? And how do you ensure that the people you’re choosing are indeed the most qualified to contribute to the success of your business?

One option is to recruit, vet, and hire your own team. However, this is by far the least efficient due to the vast time commitment required and, simultaneously, the most risky because you’re taking people at their word during the vetting and hiring processes. 

Alternatively, many forward-thinking cannabis businesses choose to work with a consulting company as their one-stop, trusted resource for guidance, industry knowledge, specialized expertise, staffing, and more. 

But what is a consulting company? And what factors do you need to be considering in order to find the right consulting company to advance your cannabis business? 

What a Consultant Is Not

Choosing a consulting company is not a decision to be taken lightly. You are trusting other people to provide you with information and direction; you are entrusting another established business with the success of your own budding business; and you are using your hard-earned dollars to indicate that trust. 

At Higher Yields Consulting, we don’t take the significance of that gesture for granted. We respect how hard you’ve worked to reach this stage and we’re eager to take you the rest of the way. That’s why we want to ensure that as you’re shopping for a consulting company, you’re aware of what to look out for. 

A consulting company is not…

  • YouTube — Your business is unique. Be wary of implementing advice from a source that is not aware of your unique business, model, and goals. 
  • Cookie-Cutter — No two states have the same cannabis legislation, no two municipalities need the same strategy, and no two businesses are alike in the cannabis industry. Steer clear of templatized services that treat you and your business the same as the next. 
  • New — The truth is that you want a consulting company that has a proven history of growing cannabis companies with creative, innovative strategies. 
  • Multi-Disciplinary — The cannabis industry is unique and requires extensive knowledge of the complexities cannabis businesses face. Avoid working with consulting companies that cater to multiple different industries. Rather, choose a consulting company that specializes exclusively in cannabis.

Above all, trust your gut instincts. The best consulting company to help you grow and succeed is likely not the cheapest, and yet they must be the most well-informed, the most versatile, and the most committed to helping you achieve your goals. 

What to Look for in a Consulting Company

Good consultants know what they do best and have processes in place for getting to the root of what you need and how to get you there. Yet, they’re also willing to adapt and deploy flexible solutions as the situation requires. 

They also commit to a relationship of honesty because they know that hiding or minimizing the truth of the challenges ahead will not benefit you or your advancement in any way. 

Good consultants know that success in the cannabis industry is all about maximizing resources and efficiency. The company you choose should be experts in mitigating risk and maximizing investment.

Every step of the way, your consulting partners should be setting you up to achieve your end goal. They should possess knowledge and connections all the way through the supply chain, and they will give you access to multiple resources to fill the gaps in your business. 

Above all, great cannabis consultants have vast experience in multiple different cannabis businesses, including vertically integrated businesses and multi-state operators, and should have a proven pattern of success — not just a one-time wins. Yet, at the same time, they should be able to provide solutions that are custom to you rather than cookie-cutter solutions they have deployed with past clients. 

Ultimately, your consulting partner should be invested in your success and committed to co-creative action. At Higher Yields Consulting, we take a phased approach to build each layer strong on top of another strong layer, all while maximizing your budget and timeline, so you can create the business and impact of your dreams.

The Power of a Pre-Qualified Team

If you are considering working with a consulting company, you’re likely looking at a few potential options that vary in size. Many solo consultants pride themselves on being a one-stop shop for cannabis businesses to rely on, but the truth of the matter is that there are far too many layers of the cannabis industry for any one person to be an expert in them all. 

Frankly, if you’ve been burned by working with consultants in the past, it’s likely because the person or people you trusted tried to be experts in too many fields. As the old adage goes, “A jack of all trades is a master of none.” 

Rather, look for a consulting company that consists of a team of individuals who are each experts in their own lane. Consider the areas of your business that you know you’ll need help with — such as cultivation, design build, marketing and branding, and more — and ask which member of the consulting team is the head of each area and why. 

Also, be wary of a consulting company that takes the stance that they know everything there is to know. Rather, a consulting firm that has your best interests at heart will take a stance of learning and constantly improving their expertise in this ever-evolving industry. 

For example, at Higher Yields Consulting, we consider ourselves a learning organization. We do have our proven processes and track record of success in countless unique businesses, stages, and license types, but we also know that there is always more to learn and there are always new opportunities emerging in this industry.  

We believe in the cannabis industry and therefore we immerse ourselves as deeply as possible in every aspect. We are helping to craft the legislation in emerging markets. In established markets, we attend the city council meetings, we get involved in the lobbying efforts, and we are actively connected with the individuals who have the power to further shape the trajectory of our industry. 

If you would like to learn more about Higher Yields Consulting and how we can help your cannabis business achieve higher yields, book a discovery call with us today!

Industrial Hemp Growth & Manufacturing: Why Now?

HYC: Industrial Hemp Growth & Manufacturing: Why Now?

For decades, federal law indiscriminately outlawed cannabis — including low-THC industrial hemp. In 2018 however, the Senate passed the Farm Bill. This bill both legalized hemp production and gave legal protections to hemp farmers. It was a crucial, monumental win for the hemp industry.HYC: Industrial Hemp Growth & Manufacturing: Why Now?

Since the Farm Bill, the hemp industry has continued to grow significantly over the last few years. From its place in everything from textiles to toilet paper, industrial hemp has become a prominent construction and manufacturing material.

Despite its usefulness, hemp is still frequently surrounded by confusion — especially with regard to the difference between recreational marijuana and industrial hemp. 

Past the confusion, however, lies the undeniable truth: industrial hemp has massive potential. Here’s what you need to know about it.

Why Industrial Hemp & Why Now?

Industrial hemp is still a budding agricultural industry, but it has great potential to become a core product in the industries of construction, manufacturing, and even food. 

Hemp is also remarkably sustainable. Unlike other crops, hemp requires little water and no pesticides to produce a bountiful harvest. Just one acre of hemp produces enough pulp to replace four acres of trees! This means that growing industrial hemp is an agricultural endeavor with a minimal environmental impact.

The benefits of hemp aren’t isolated to the environment: hemp has further proven itself to be a robust construction material. With more tensile and compressive strength than steel, hemp has secured its place as one of the strongest building materials around.

However, one question still remains unanswered: Why now? Why enter the hemp market right now — isn’t the world still in a tailspin following the pandemic? 

Industrial Hemp in Construction

In the wake of the COVID-19 pandemic, construction costs have skyrocketed. Industrial hemp offers a strong, sustainable, low-cost alternative to many construction materials. 

HYC: Industrial Hemp Growth & Manufacturing: Why Now?

Traditionally, American construction projects are heavily reliant on imported materials. In fact, 40% of the typical American home is made of imported materials. Hemp, though, can be grown domestically and dramatically reduce transportation costs.

This reduced transportation cost allows growers to bring a stronger and more sustainable product to market for less. With the construction market at a record high (and in need of a lower-cost alternative), now is the time to bring industrial hemp into the limelight.

Potential Pitfalls to Avoid

When breaking into the hemp industry, it’s crucial to avoid pitfalls that will needlessly cost more time and money. The first of these pitfalls is genetics. Understanding the characteristics of a certain hemp strain will allow you to figure out what it can be used for. 

For example, some strains have a strong, rigid construction while others tend to be softer. If you’re producing toilet paper, you’d probably want to avoid any rigid, uncomfortable hemp. Similarly, you probably wouldn’t want to use a soft, tissue-like hemp in a large construction project.

Take the time to understand the genetics of the plant, and make sure those genetics work with the products you want to bring to market.

The second pitfall comes when looking for a manufacturer. It’s tough to find one willing to work with hemp and even tougher to find one with a successful track record of bringing hemp products to market. 

Finding an experienced manufacturer is crucial. Although an inexperienced manufacturer may be more willing to work with you, they’ll perform most of the R&D on your dime. They’ll be learning on your money rather than on theirs.

Working with an experienced consultant — like our team at Higher Yields — can help you to secure a manufacturer who’s willing to work with hemp and has a history of successfully bringing hemp products to market.

Cutting-Edge Innovations with Industrial Hemp

Construction may be a leading factor in the growth of the hemp market, but it’s by no means the only one. New technological innovation has paired with a renewed interest in industrial hemp to spark countless cutting-edge innovations.

From hemp toilet paper to hempcrete, these are a few of the coolest hemp-based technologies:

  • Toilet paper made from hemp is both soft and strong — while going easy on the environment.
  • Hemp biofuel is far more sustainable than fossil fuels, and it even has a lower carbon footprint than corn-based fuels.
  • Supercapacitors and batteries that use hemp nanosheets are infinitely cheaper and more efficient than traditional alternatives. 
  • Hemp-based plastics offer just as much durability and versatility as traditional plastics but are more sustainable and completely biodegradable.
  • Hempcrete offers a strong, naturally-insulated building material that allows moisture to evaporate and hinders mold growth.

As the innovative uses for industrial hemp continue to grow, so too will the hemp industry (making right now one of the best times to get into the industry). Further, the continued support of hemp companies for innovation will lead to more advanced technologies that further both the industry and global sustainability.
Here at Higher Yields Consulting, we’re a think tank that supports industrial hemp research and advocacy. Book a consultation today and we can lead the way together!

What You Need to Know Before You Decide to Sell Your Business

Higher Yields Consulting What You Need to Know Before You Decide to Sell Your Business

In a saturated cannabis market like Oklahoma, it’s extremely difficult for small businesses to get off the ground and be able to compete. So if you’re struggling as a cannabusiness owner, you may be wondering if it’s time to sell your business and get out altogether.

However, if you know how to look at a distressed business the right way — and if you have the right experience — there are still opportunities to make it work. Once you identify why your business is in distress, you can determine the best move forward — whether that be selling your business or not.

Higher Yields Consulting What You Need to Know Before You Decide to Sell Your Business

Read on to learn what might be causing your business to struggle and how to decide whether you should sell your business.

Why Are Cannabusinesses Struggling?

According to Anthony Edward, HYC’s Director of Business, cannabusinesses fall into distress for several reasons. “It’s a trifecta of lack of funding, lack of support and help, and lack of output or foreseeable growth,” he says.

One of the biggest mistakes we see is that people get into the industry and underestimate timelines, resources, and budgets. Markets like Oklahoma are so easy to get into that people jump right in without knowing what they’re doing. They assume that because marijuana is a weed, it’s going to grow itself. But it won’t. 

Businesses that don’t know what they’re doing end up running out of money before even getting off the ground. Sometimes they grow inefficiently and have to charge higher prices for low-quality products. Other times they fail to ensure compliance from the start, which ends up costing more time and money in the long run.

And, as Edward points out, these issues can stem from a lack of viable operators who are taking the business seriously. “We’ve spoken to several businesses in Oklahoma that were struggling with operators, head growers, or general managers,” he says. “It’s eaten into their profitability, efficiency, and also the quality of their products.”

People get into the industry thinking they can get these astronomical revenue numbers they see in other states. But without understanding their own markets, they greatly overshoot their projections and underperform. So the question is, can you recover from early-stage missteps, or might it be time to sell your business?

What Options Does a Distressed Business Have?

If you’re struggling in one or more of the above ways, you may think that your only option is to sell your business — and that is one option. 

If you do choose to sell your business and exit the industry, make sure you do so properly. According to Edward, with expert help, you could at least get some of your investment back or be made whole on it. 

But selling might not be your only option. Many people don’t think about marketing and branding until it’s too late, but improving this one area could increase your traffic and sales. Work on standing out from the crowd by establishing a credible online presence and improving your overall customer experience.

Higher Yields Consulting What You Need to Know Before You Decide to Sell Your Business

A third option is to reinvest with the right partners. If you’re only missing one puzzle piece — that is, if it was simply one bad decision or mistake that put your business in distress — you could greatly increase its equity value by bringing on the right partners and making small investments in the right people.

Whether you ultimately decide to sell your business, improve it, or reinvest, you’ll need to figure which path is best for you and pivot in a way that mitigates risk. 

Is It Time to Sell Your Business?

As you consider whether you should sell your business, Edward advises evaluating your situation to get clarity on where you are right now, what your vision for the business was, and the gap between the two. 

Be willing to approach the decision unemotionally and with an open mind; it can be hard to give up on your dream, but this needs to be a business decision, not an emotional one. 

If you want to sell your business, take the time to get your financials and lease documents in order. Your business will look better to a potential buyer, thus increasing your likelihood of making a sale.

Make sure that additional management or investor partners are also ready and willing to be involved in making the decision, even if it’s a hard one to make. 

Finally, seek out help from experts. As Edwards says, “be open-minded to directional leadership from experts in the industry. Be ready to engage and have a dialogue, and keep everything on the table until it’s not on the table anymore.” Relying on expert guidance will equip you to make the most rational, well-informed decisions. 

Are you ready to take an in-depth look at your cannabis business? Before you decide to sell your business, get in touch with the expert consultants at Higher Yields Cannabis Consulting.

The True Cost of Your Cannabis Licensing Application

Higher Yields Consulting Cannabis Licensing: The True Cost of Your Application

Putting together an award-worthy application for cannabis licensing requires a lot of time, hard work, and capital. Industry hopefuls must understand the true cost of winning a cannabis license, as well as the potential revenue streams that license could make possible. 

Higher Yields Consulting Cannabis Licensing: The True Cost of Your Application
A view of a general cannabis sign on the front of a building.

From there, you can determine whether you want to work directly in cannabis or an ancillary industry. In the case of the latter, our Pivot Program can help! If you plan to go right into cannabis, though, your state directly impacts the cost of the application. 

The bottom line is knowing what you’re getting into. Follow along, and we’ll guide you through all of the costs associated with your licensing application.

Seek Out Expert Consultants

The first and most important investment any applicant can make is in a consultant. In fact, your choice of consultant can make or break both your budget and your application. More often than not, you’re better off with a consulting firm with a history of helping clients submit winning cannabis licensing applications. 

As opposed to lawyers, consultants offer the most thorough and affordable full application support. But before you hire one, be crystal clear on exactly what you’re getting. Some consultants aren’t clear as to what is and is not included, which essentially forces you to spend more money later on in the process.

As Emily Seelman, our Senior Technical Writer put it, at Higher Yields, “We pride ourselves on making it straightforward. We tell you ‘Here is what we include in our full coverage, and here’s what we don’t.’” 

Consider 280E Structuring & Cannabis Licensing Fees

As is the case with any business, you want to stay on the IRS’s good side. In cannabis, that means structuring your business to be compliant with Section 280E of the Internal Revenue Code, which stipulates that cannabuisinesses cannot write off expenses because cannabis is still federally illegal.

Or, in the words of our Founder and CEO Cory Waggoner, “You can’t write off your mileage on your way to a bank robbery.”

Depending on the company’s size, it costs $5,000 to $10,000, plus state fees, to structure as a 280E business. That being said, it comes with plenty of benefits — like making you a more credible cannabis licensing applicant. If needed, the CPA who sets up your 280E compliance can even serve as the interim CFO on your application.

Application Fees

When it comes to the application itself, fees will largely be determined by the market in your state. If you apply in a state with high competition — like New York, Florida, Virginia, or Arizona — then the cost will surely be higher (think five to six figures).

On the other hand, low competition states offer a more affordable option with licenses being available for mere thousands. While these states — like Oklahoma or Massachusetts — make it less expensive to get in, their licenses are inevitably less valuable.

Other states, still, offer an option in the middle. Rather than charging a straight cannabis licensing fee, they make a portion of it refundable if you don’t win. This lowers the risk while maintaining the value of awarded licenses.

Work With Experienced Attorneys & CPAs

Cannabis-specific attorneys and CPAs play key roles in the application process as well, but not immediately. Although they both can do a lot, they tend to be expensive and lack expertise outside of their focus areas — legalese and accounting.

Higher Yields Consulting Cannabis Licensing: The True Cost of Your Application

Conversely, an experienced consultant will be able to tell you, “You should have an attorney review this,” or “This is something a CPA needs to set up.” That way you get everything you need without unnecessary costs.

Secure Real Estate

Another crucial component of your application will be securing real estate. In fact, it turns out to be one of the biggest upfront costs for new operators. For this reason, carefully mapping out and choosing cannabis real estate is one of the most important steps you’ll take.

As far as the cost of real estate goes, it varies. The size, geographical location, and number of potential buyers or tenants all impact the final price of the property. 

Even then, Seelman explains, “In competitive states, landlords or property owners will sometimes charge a deposit to engage in a letter of intent or a contingent purchase or lease agreement.”

Mapping Out Floor & Security Plans

With a location secured, you’ll need to map out a functional and profitable floor plan. In some cases, this task will be included in your consulting fees. If not, you’ll have to outsource it to an architect or engineer.

However, they don’t need to be stamped, official drawings. The floor plan is mostly for the state to see that your layout is designed for both safety and compliance.

Additionally, you’ll need an outline of your security plan. Like the floor plan, this may be included in your consulting fees, but overlays can cost an additional few thousand dollars., otherwise.

Licensing boards usually require cannabis security plans to be detailed and specific. All the way down to camera placement, window tint, and even your landscaping. Shrubbery, for instance, could be used as cover by would-be burglars, and you can be sure that the cannabis licensing board will point this out.

Assemble the Right Team Members & Operators

An expert team is the core of your operation, so you should assemble your team carefully and deliberately. Work closely with your consultant to assess the value of each candidate — especially the ones who charge to be on the application.

Also, be sure to thoroughly vet their history. Cannabis experience is a must, but an unclean record can sink your entire application. The same goes for any companies you work with. Always know what exactly they bring to the table and how it will improve your own operation.

Furthermore, Seelman warns “Some companies will charge for a letter of support. While there are some good reasons, you probably won’t need it. If this comes up, talk to your consultant to see if it strengthens your application.”

Hiring Lobbyists

In addition to your official team members, you’ll want to hire lobbyists. Their connections will add merit to your cannabis licensing application and boost your credibility. Although this system is far from ideal, cannabis is a highly politicized industry that’s fueled by a network of social connections.

Whether you have a single lobbyist or in excess of ten, Seelman explains that they should either have cannabis experience, tobacco experience, or a vast network of connections — preferably all three. Together, you and your consultant can weigh their expertise with their fees and make a decision.

The True Cost of Cannabis Licensing

From consulting fees to real estate, applying for and winning a cannabis license gets expensive. If you do it thoughtfully and with intent, you can maximize your chances of winning while keeping your expenses reasonable.

Certainly, though, the most important aspect is knowing what you’re getting into. Otherwise, the costs will keep adding up, which can quickly leave you overwhelmed.

Are you ready to invest in your cannabis operation? Book a consultation today, and learn more about what’s included in our consulting packages!