- The biggest challenge Cannabis 2021
- Obstacles
- Dealing with an ever-changing landscape
- The U.S Market
- New products in the market
- Stigma
- Conclusion
The biggest challenges Cannabis 2021
The cannabis industry is booming, with plenty of chances. Meanwhile, the cannabis business is beset with stigma, misunderstandings, and unresolved issues. Cultivators has witnessed great development toward a clear cannabis environment in recent years. Cultivators developed a market segmentation years ago and is pleased to see that it has been embraced by industry leaders.
Several businesses are getting more money, including Nabis, a software-enabled cannabis distributor that aims to streamline the distribution process by connecting growers, manufacturers, brands, and vendors.
With fast-paced mergers and acquisitions (M&A), new firms starting, and older outfits rising to prominence, it appears as though the industry's dynamic changes every day.
The cannabis business has nowhere to go but rise as regulations around the plant continue to change. In fact, the cannabis sector in the United States is anticipated to reach $30 billion in annual market value by 2025. 3 However, like with any new industry, there are always obstacles to overcome.
Here are a few of the obstacles that the cannabis business may face in 2021.
- By 2025, the cannabis market is estimated to be worth $30 billion annually.
- Despite tremendous progress, notably in terms of legality regulations, the sector will continue to confront several obstacles.
- As various nations and states in the United States approach the use and sale of cannabis in different ways, legality and regulation will continue to shape the industry.
- Banking will remain a difficulty for cannabis businesses in the United States, as they are unable to use regular banking services and must rely on cash.
- Changes and instability will continue as established "addiction" sectors, such as alcohol and tobacco, consolidate their positions in the cannabis market.
- It will be tough to overcome the stigma of a substance that has been banned for so long.
Dealing with an ever-changing landscape
The cannabis market must constantly adapt to an ever-changing landscape as it grows and evolves. Much of this terrain revolves on the drug's legality, since different states in the United States, as well as foreign countries, have varied rules regarding the drug's legality, usage, distribution, and growth.
Starting a cannabis-related business or investing in cannabis-related enterprises is a tough undertaking since one never knows what regulatory changes may benefit or hinder the industry in the future. It's almost as though you're on a minefield.
Other, more established firms outside of the cannabis sector are becoming increasingly involved in major ways as the legal cannabis industry continues to grow.
The "addiction" industries, such as alcohol, tobacco, and pharmaceuticals, have been actively investing in the cannabis market, purchasing dozens of new companies in the process, with the goal of mass-selling cannabis like their other goods.
As more tobacco, alcohol, and other industries seek a piece of the cannabis pie in the next year, substantial changes are inevitable. This entails increased uncertainty and volatility for investors. When you add in the legal problems, it's clear that the cannabis market is tricky to handle.
The U.S Market
Some of the concerns and problems that the cannabis industry will face in 2021 are likely to repeat again. The U.S. market is one important aspect. The United States remains a very complex environment for cannabis firms and investors, in part because, while cannabis remains illegal at the federal level, a rising number of states have legalized it locally, allowing cannabis companies to operate.
It's not as simple as opening up shop in a state that has legalized cannabis for cannabis entrepreneurs wanting to grow into the US market. Companies must overcome several legal and financial obstacles, with many needing to seek financing from Canadian investors, since Canada has legalized cannabis and the sector is already forming a structure with many businesses functioning.
Other businesses must negotiate the intricate realm of importing and exporting items that are still prohibited under federal law, as well as the challenges that arise when regulations shift significantly throughout the country.
Investors may turn to companies that have grown into large-scale operations in the Canadian market for insight into how these companies may break into the US market. However, this has proven to be a considerable difficulty thus far.
Banking is another issue that the US economy is dealing with. Because Congress has failed to eliminate banking restrictions on cannabis, businesses have limited access to financing and must rely on cash, limiting their ability to expand in the United States.
New products in the market
New products are expected to take the cannabis business by storm in 2021. New hemp- and CBD-based goods, as well as vaping equipment, consumables, and other items, are all in the works.
While some of these items are unlikely to have a major influence on the cannabis sector as a whole, others might be game changers. If cannabis-related products, like as CBD, are lifted from Schedule I, the latter is especially certain.
This shift in status would enable for widespread adoption across the United States, perhaps transforming the cannabis industry into a major section almost immediately.
Stigma
Despite the fact that cannabis is becoming more acceptable in society as a result of the passage of legalization and the expansion of the business, there are still numerous stigmas associated with the drug because it has been banned for so long.
As society gradually embraces the substance, overcoming this stigma will continue to be a struggle, particularly when it comes to large-scale marketing efforts, workplace drug testing, talks with families, and so on.
Conclusion
Though the cannabis industry is expanding and the drug's usage is becoming more mainstream, it will continue to encounter several hurdles that will stymie its growth and make it difficult for investors and businesses to succeed.
Anyone working in the cannabis sector has to stay on top of the constantly shifting rules and put themselves in a position to adapt quickly.