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How to Secure a Service Contract in the Cannabis Industry
If you’re looking to work in the cannabis industry, but are struggling to negotiate a cannabis service contract, read on to learn how cannecht can help.
If you’ve been trying to break into the cannabis industry but are struggling to get your foot in the door or close in on a cannabis service contract, you’re probably wondering if there’s something wrong with your service offerings or pricing structure. While you might be missing the mark on getting yourself noticed (we’ll cover that below!), keep in mind that "licensed cannabis industry operators" have unique challenges that traditional businesses do not encounter.
Why Is It Difficult to Secure a Service Contract In the Cannabis Industry?
Despite widespread legalization efforts, cannabis remains a federally illegal drug in the US, and every licensed cannabis operator faces a never-ending string of complex changes. In a whirlwind of regulatory shifts in a newly legalized industry, operators might struggle to find the correct service providers, slowing down the process of signing service contracts and initiating new projects.
Volatility in a New Industry
Even though it might seem like medical and recreational cannabis have been around for a long time, it’s still very much a new industry. As states legalize one by one, they look to veteran states for guidance on how to develop their regulations. Yet, each state is still governed by different laws and regulations to operate compliantly.
The real plot twist comes when local and state governments tweak and adjust the laws’ language. Although this is in an attempt to fine-tune their programs and ensure the overall success of the cannabis industry, it can seem like no one thought to consult people on the ground who are affected by changes.
For example, a minor change to canopy limits for recreational grow sites might seem like a good idea for land use permits and tax purposes, but it might snowball and flood the market one season. Or consider a slight change to the specific wording required on a warning label. While the intent may have been to protect companies from liability regarding their products, it could cost the cannabis producers exorbitant amounts of money to pull products from shelves and relabel all of their inventory.
Limited Capital and Resources
There seems to be this misconception that anyone working in the cannabis industry is rolling in the dough. It’s literally growing on trees, right? And while it’s true that many companies have seen massive success, many are struggling to get by.
Plenty of cannabis companies showcase an impressive product line with a gorgeous brand kit, top-of-the-line greenhouse, or high-end fleet of delivery vehicles. This forward-facing image can easily give the impression that there is plenty of money to burn. In reality, many operators are doing everything they can to compete in their industry while simultaneously keeping the lights on. Not to mention trying to predict what kind of regulatory changes might require costly pivots in the future.
It’s not necessarily that they aren’t making money in their business, but the cost of running a cannabis company is staggering. In some states, application and licensing fees cost tens of thousands of dollars. The startup costs to simply maintain compliance include a slew of additional factors that other industries don’t have to worry about. Not to mention cannabis tax laws are not friendly towards business owners, and you can’t just write off everyday expenses that are considered normal in other industries.
That said, of course licensed cannabis operators want to work with the best service providers to enhance their operations and improve their business. However, sometimes they are simply a little hesitant to walk through the process of finding the right person or team and building a service contract that meets their needs.
Finding Clients in the Cannabis Industry
The cannabis industry is growing at exponential rates. Global sales are expected to reach $33.6 billion by 2025, and with a rise in sales, higher demand for cannabis-specific service providers will come across a multitude of sectors. There are plenty of things you can do to get yourself noticed, find the right partners, and get that cannabis service contract signed.
Know Your Market
Understanding your target audience is essential in any line of work, but especially in the cannabis industry. A few key questions to ask yourself are:
Are your services only available locally, or can you work remotely?
For example, if you work in cannabis marketing, marijuana packaging, cannabis accounting, equipment manufacturing, or seed-to-sale software, you may be able to offer your services from anywhere. However, cannabis laboratory services or any kind of service offering involving touching cannabis or its byproducts requires you to be local or show up in person when needed.
What are the rules and regulations surrounding the work you do as it applies to the cannabis industry?
Depending on your service area, there are likely particular laws you must comply with. For example, if you work in cannabis accounting, tax, or legal services, a deep understanding of the 280-e tax code is mandatory to adequately serve your clients. Likewise, if you can work remotely, be aware that you will need to comply with your client’s guidelines on a state-by-state basis.
Another factor to consider is whether or not you need any kind of marijuana worker permit if you are handling cannabis.
Refine Your Offerings
Get very clear on what you do and do not offer. Excitement builds quickly in such a rapidly-evolving industry, and it can be far too easy to take on more than you are actually willing (or able) to do. A well-polished list of offerings can help establish clear boundaries around your specific skill sets and work details.
Build a service plan and include the following:
- Create an outline of your cannabis service offerings.
- Include a list of items or information you’ll need from your client to get started.
- Clearly define what you can do, and take note of areas where you may need additional support or the ability to partner with others to complete your projects.
- Include as much information as you can about how long it will take you to complete each project.
- Be clear about your pricing. If you price by the hour, by the project, or request a retainer, be sure to include the details.
- Gather any client testimonials, portfolio, or proof of success with other partners to validate your expertise.
These details and other information about your offerings will make signing a service contract and getting to work much more manageable.
Put Yourself Out There
Okay, now it’s time to find your ideal partners. Some of the most effective ways to increase your visibility are by working on your digital presence. Any professional business should have a company website with information about who you are and who you serve, as well as any relevant information about how you help your clients achieve their goals.
In addition to a website, use social media platforms like LinkedIn, Facebook, Twitter, or Instagram to reach your target audience. Be sure to include contact information anywhere you can, including a professional email address, phone number, and website URL. Digital visibility will increase your chances of reaching new clients and educating your audience about your professional cannabis services.
Consider attending cannabis conferences and industry events to network and advertise your services. When possible, get out into your local cannabis community and get to know the operators. Sometimes you’ll get lucky and meet people that can open new doors for you.
Build Your Business With cannecht
Entering the cannabis industry without a network to rely on or enough industry-relevant experience can be a considerable challenge. Don’t get discouraged. Instead, let us inspire you to find your ideal business partners and close more deals than ever before.
The cannecht platform is designed to help licensed cannabis operators and service providers find each other. Not only that, but the unique discovery process perfectly matches you with clients that are looking for exactly what you offer and walks you through the process of signing a service contract within minutes of closing your deal. Here’s how it works.
List Your Services
If you’ve done the work to refine your service offerings, you’re already a step ahead of the game. First, build your profile in the cannecht platform and list your offerings, pricing, and availability. Unlike other service directory sites, cannecht is a digital marketplace where you are matched with potential clients based on their refined project criteria and your pre-defined service offerings. We’re talking about deals, not just leads.
Team Up With Other Professionals
Sometimes you need to work with other professionals to complete projects. Instead of being passed over because you only offer one piece of the puzzle, cannecht allows you to partner with other cannabis service providers to complete projects for your clients. This opens up a whole new world of opportunities, expanding your network and strengthening your service offerings.
Study Your Wins and Losses
What if you could find out why you close some deals and not others? You can with cannecht. The platform provides valuable analytics about what criteria your target audience is looking for so you can adjust your offerings to help you close more deals.
Are you ready to save valuable time and money seeking new business opportunities? Close more deals and sign service contracts quickly with cannecht. Reach out to learn more, or sign up for our waitlist and be the first to experience the platform. Your ideal clients are searching for you. Find them with cannecht.