Cannabis/Marijuana Business Plans

Are you a cannabis company looking for financing? Sharp Business Plans can provide cannabis-oriented business plans that attract external funding.

We Write Successful Cannabis Business Plans

"A plan that is not written down, is not a plan...It's a dream." With the legalization of recreational cannabis in effect as of October 17, 2018, it's still not too late to get into the industry, but you will need a cannabis business plan.

It is very unlikely that Health Canada’s quality standards will be relaxed, because the Canadian quality brand is probably the world leader in quality cannabis. Demand for high-quality cannabis is expected to exceed supply for the next few years. The currently licensed producers will probably aim a lot of their product towards the recreation market, so there may be shortages in both the medical and the recreational markets. If you are thinking about opening a retail outlet for cannabis, aka a dispensary, check out the information on our dispensary pages.

If you are considering applying for a licence under the Cannabis Act (previously Bill C45, ACMPR, MMPR, MMAR) for Standard Cultivation, Micro Cultivation, Nursery, Standard Processing, Micro Processing or Medical Sales, etc., you need a business plan. Your business plan is an important part of your licence application and we have produced over 60 business plans for organizations applying for their cannabis licence. (We have also written business plans for virtually all other types of cannabis businesses, including many retail dispensaries).

Important Components to Cover in Your Licence Application

  • People
  • Buildings
  • Security
  • Storage Facility
  • Inventory
  • Record Keeping
  • Standard Operating Procedures (SOPs)
  • Quality Assurance
  • Pro-Forma Financial Information

You need to provide information about the building(s) that you’ll be using to grow, dry, store and distribute cannabis, plus detailed site plans that show the entire property. Also required are detailed descriptions of the security systems and processes: an in-depth description (and preferably evidence) of a sophisticated tracking and recording system that can track the seed or clone all the way to the container (no bigger than 30 grams) that’s delivered to a specific customer.

You’ll need to engage a quality-testing service to analyze the specifications of each batch of cannabis: every batch of every strain. There are regulations about container size and specifications, labelling, etc.

Of course, since you’re dealing with the federal government, it’s not just the cannabis regulations that you need to worry about. You have to take into consideration the Health Canada Directive on Physical Security Requirements for Controlled Substances. Did you know that Health Canada has determined the value of a kilogram of cannabis is $10,000? That’s $10 per gram!

Also, take into account the Controlled Drugs and Substances Act, which is over 100 pages with an additional 750 pages of regulations. Then of course, there is the 40-page Food and Drug Act. However, the consolidated regulations that form an essential part of the Act are another 1,250 pages. These in-depth and lengthy requirements and regulations are a clear indication that if you want to get into the cannabis business, you are going to need professionals to assist you. We specialize in business plans, but can also recommend other cannabis professionals. That’s where Sharp Business Plans can help.

We Won’t Write a Business Plan if we Don't Think it Will Succeed

If you want your licence application to succeed, you should be prepared to invest tens of thousands of dollars in preparing the application and the accompanying documentation. (No. We don't charge that kind of money for an cannabis business plan).

The potential profits from a cannabis growing or extraction business are huge, but you do need an adequate investment to get into it. When you’re investing, you need a business plan. The business plan should help you break down your costs so you know how much it will take to get into the cannabis business. We also understand that Health Canada will be reading your business plan, because it is an essential component of your application. So we make sure that we satisfy THEIR interests as well as yours and your investors.

Our business plan will also tell you the individual cost components for each gram of product, how your business will operate and show you the potential profits from that business. Our plans include a financial model that allows you to change variables like yield, CO2 cost, hydro rates, order size, and selling price and immediately see the impact on your bottom line.

A typical 2,000 square-foot flowering room with a rolling bench growing system and a retail price of $5 per gram can easily yield $300,000 worth of cannabis every 70 days. That’s over $1.5 million a year in potential revenues from just 2,000 square feet, a very small commercial operation. Variable growing costs should be under $1 a gram and if you’re leasing the premises, capital expenditures could be under $400,000. The profit potential is amazing; just do the math. You’ll probably need a lot more space than a single 2,000-foot flowering room for a full-scale licence, as Health Canada does not seem to be approving very small operations. (Micro-cultivation licences are a very different story).

When you’re applying for a cannabis producer’s licence, Health Canada wants to know that your business is going to be run like a business that manufactures narcotics. You have to demonstrate that you understand personnel security requirements, physical security, detailed record keeping and stringent quality assurance protocols. Yes, the licence application has to detail these and other mandatory requirements, but it’s your business plan that ties everything together in one concise document. Health Canada insists that their suppliers (you) have a viable business plan so that they will stay in business for the long term.

Over 20% of the applications received by Health Canada are either rejected or withdrawn by the applicants because obvious requirements were not met. Nearly 45% of the applications are returned as incomplete. Only one third of the applications received are even being reviewed at this time, so two-thirds have already failed the test. Do you think they had a decent business plan?

We are experts at writing business plans and have prepared business plans for many different types and sizes of business, including cannabis businesses. We’ve prepared over 60 business plans for people and organizations applying for their cannabis licence. As professional accountants, we make sure that the financial statements show a good picture of the business and that all of the numbers tie together and make financial sense. After all, you want the business to actually make you money, don’t you?

Many people who prepare business plans use a cheap software package that does all of the work for them, so they can churn them out quickly. If you are only quoted a few thousand dollars for a business plan, it is almost certain that you’ll get a document generated by one of those business plan software packages. We do it right. We will challenge your assumptions and make sure that your business plan makes business sense.

We will work with you to prepare a professional document — a business plan that works for you.

We’ve researched, prepared and presented hundreds of business plans, strategic plans, budgets, forecasts and business cases for small businesses and large corporations. Our audience has been managers, business owners, bankers, investors and Boards of Directors. When you need help with a cannabis business plan, call us at +1 (800) 661-9842.

ACMPR/Cannabis Act Business Plans

Check out this infographic from Marijuana Business Daily that illustrates the types of problems you may face when seeking funding. (Click on the image to see the full-sized infographic).

Further Information

Cannabis Dispensary Liscense in Canada

Cannabis Dispensary Liscense in Canada

As of October 17, 2018, you can open up a legal cannabis dispensary. Sharp can help you provide Health Canada with a professional cannabis business plan that increases your chances of approval.

Become a Licensed Producer of Cannabis

Become a Licensed Producer of Cannabis

Are you looking to become a licensed cannabis producer in Canada? Sharp Business Plans can help your Canadian business submit Health Canada friendly business plans.

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