Marijuana use has seen a tremendous growth recently, and many marijuana enthusiasts and growers who have entrepreneurial mindset has started exploring possibilities of using their passion in marijuana into a business. If you are one of those people who are thinking about making leapt from a mere user or grower to an actual marijuana kingpin, then perhaps you are curious to know how big the market size and industry of marijuana are.
There are many factors that determine one’s success. Some people believe it is striking while the iron is hot. Others believe that you must know the right strains of marijuana to grow and sell (view some common strains listed by weekendgardener.net). Many more believe that it is just luck.
In any business, the most important thing to remember is to know about your market and the way the sector of your business work. Through this article, we hope we can describe to you the big picture in the business side of marijuana. We hope that through this, you can make the informed decisions whether to start a business in marijuana.
WHAT DOES THE MARKET OF MARIJUANA LOOK LIKE?
The Compound annual growth rate (CAGR), the rate of return on the investment that would be required for an investment to grow from its beginning, has been reported to grow to as much as 14.5% from 2019-2024. Biggest driver for this growth was identified to be the medicinal properties of cannabis, legalization of marijuana use in most states, and advancements done in the in marijuana’s breeding and intellectual property of cannabis. A good example of this drive occurs with the openness of most country to engage in trade of marijuana such as with the Australian government’s approval for its local marijuana growers to export medical cannabis and other cannabis-based products in different countries worldwide.
Of course there are things that actually slows down this growth. The prohibition of marijuana in most countries, and the heavy-handed penalties in the possession of this herbs remains to be the biggest restraint in the cannabis market. Other than this, experts have also identified increasing stress on limited resources like water and sustainability of cannabis farming, very strict regulations in the recreational use of marijuana, and steep competition with mainstream and traditional alternative medicine.
INCREASING LEGALIZATION IN THE USE AND TRADE OF MARIJUANA IS A FUEL FOR GROWTH
As mentioned above, medicinal use of cannabis remains to be the biggest driver for growth in the market of cannabis. While many people use marijuana recreationally, most countries have legalized marijuana use not for recreational purposes but rather because of its medicinal benefits. Countries including Australia, Canada, Chile, Colombia, Germany, Greece, Israel, Italy, the Netherlands, Peru, Poland, Portugal, and Uruguay have legalized the medicinal use of marijuana. While cannabis is now legal, it is still being heavily regulated in many countries that did open up the use and trade of this plant. As such, much of the worldwide trade of cannabis-based products are due or for its medicinal benefits.
The United States also offer a great picture to how medicinal use of marijuana is dominating the cannabis market. In the US, majority of the adult population are 50 years and above. This demography are known for having higher risk of chronic diseases. As such, the medicinal needs of this demographic is seen by experts to be a strong boost to the demand for marijuana and marijuana-based products in the country. At the moment, the State Medical Marijuana Laws of the United State lists down Alzheimer’s disease, anorexia, HIV-AIDS, glaucoma, cancer, arthritis, epilepsy, nausea, pain, cachexia, Crohn’s disease, migraines, multiple sclerosis, spasticity, and wasting syndrome as health conditions that are manageable through marijuana. As you can see, the majority of these are most likely to be diseases and symptoms of diseases commonly attributed to ageing.
As the world moves forward, many scientists are looking into more health benefits of cannabis. As such, research and standardization of products for marijuana’s medicinal use will certainly continue to improve the market for marijuana.
SIZE OF THE COMPETITION OF MARIJUANA BUSINESSES
If you will think about your market, the next question you need to ponder on is the competition. With the high demand for marijuana, surely the market now is being saturated with competition vying for a big chunk of cut in the growing pie of marijuana market. Right now, the competition is still is at its infancy. The legalization of marijuana in most states worldwide happened in the last twenty years or so. Growers and enthusiasts have only just started looking at the potential for growth. Many big pharmaceutical companies like Phizer and Glasco Smith Kline have not yet entered this market.