The cannabis industry is an emerging and fast-growing sector that has attracted many investors that are looking to be among the first to reap from high returns and potential growth. Many of the investors believe that the sector is full of untapped markets as well as products that may be in high demand in the future.
In most cases, some investors have enjoyed huge returns in some of the new sectors, such as those ventured into internet-based firms early. With this notion, many investors are willing to speculate on trends and also risk their investments in products and industries with no history or a proven record of success.
In the recent years, the cannabis industry has grown as quickly as many jurisdictions, including certain U.S states and Canada, have reviewed their restrictive rules on the use and sale of cannabis. For instance, Canada has already passed a bill to legalize medical marijuana, which has seen many companies express interest in venturing into the market as well as approaching investors who believe cannabis is a promising sector.
In Canada, the federal government has also legalized the use of marijuana for recreational purposes, a law that is expected to come into effect on 17th October. With the new development, many cannabis firms offer investors an excellent chance to capitalize on the enormous potential of this sector. Besides, some companies are also hoping to expand their business into the U.S. As mentioned earlier, some of the states in the U.S have legalized the use and sale of marijuana for both medicinal and recreational purposes, though the federal law still prohibits it.
Businesses in the cannabis industry
The cannabis industry has grown beyond cultivation and distribution of marijuana due to the rapid expansion of the sector. Many new companies have seized the opportunities created to develop products, services, and technologies. Currently, several businesses are operating in the cannabis industry, though some of them are not directly involved in the actual growing and selling cannabis products. Therefore, the rapid growth of the industry has made it possible for investors to invest in a company without venturing into the cultivation and distribution of marijuana.
The following are some of the major businesses in the cannabis industry:
Growing and selling
These are the most famous businesses, as people often think about growing and selling cannabis when discussing the marijuana industry. However, the rapid expansion of the industry has led to great diversification in it, and creation of other types of businesses, which promises a great future for investors.
These businesses manufacture products that are used by people in the consumption of cannabis, including but not limited to pipes, vapes, and rolling papers.
Marijuana infused products
These businesses specialize in the selling of marijuana infused products, such as e-liquids, drinks, oils, topicals, edibles and other products. With many people becoming aware of the benefits of cannabis, these businesses are expected to even have more returns in the future.
Ancillary goods and services
Ancillary goods and services are businesses that specialize in providing products and services that complement the whole cannabis industry. These include companies that produce equipment that are used the sector such as a cannabis breathalyzer, which is used to test cannabis products in the laboratories. It also includes firms that create consumer packaging for products as well as those that offer insurance to cultivators.
Agriculture technologies is a critical business sector that aims at enhancing the cultivation of cannabis. These businesses are involved in the innovation and development of equipment that is required in the cultivation of cannabis, which includes green technologies, automated fertilizer systems and enhanced lighting systems.
Organic marijuana farms
These businesses offer organically grown marijuana to other companies as well as selling it directly to consumers. Organic farms rely on the growing demand for natural products and services to support their business’s growth. Many people are running from products made from raw materials grown with chemicals due to the health risks posed by these compounds.
Biotechnology refers to businesses that deal with pharmaceutical applications of marijuana, which is one of the most promising sectors in the cannabis industry. This involves developing treatments for particular diseases and illnesses.
These are businesses that use industrial hemp to provide products for medicinal purposes and other uses. Industrial hemp is different from cannabis and has numerous uses and application, which include making consumer products such as clothing and paper or building materials, foods and fuels.
Consulting services refer to businesses that help those in the cannabis sector navigate through complex rules and regulations between various jurisdictions. These businesses may offer services like helping with zoning, licensing or advising those in the industry on operational processes.
These are businesses usually own a vast number of voting shares in various cannabis companies. This enables them to control and influence the management of all the businesses they hold.
Overall, investing in the cannabis industry is a great thing as it is a new and fast-growing sector with great potential and returns. However, the cannabis sector also comes with some risks that could affect your investment at any time. The business models and laws on the use and sale of cannabis continue to evolve, which means that there is a considerable amount of uncertainty in this emerging venture.
Besides, many investors may also flock the industry, mainly due to the high returns while trying to avoid being left out of an opportunity leading to adverse impact on the industry. The rapid expansion of the cannabis industry led to great diversification. This allows investors to engage in a variety of profitable businesses rather than relying on just cultivation and selling of cannabis.
Therefore, if you are an aspiring investor to get into the emerging sector, you can consider investing in any of the businesses mentioned above. It is also important to look at which business favors you as an investor. Besides, is also advisable to consider a company where you have an added advantage over competitors, as this will guarantee you success.