Loans, Financing, And Capital For Cannabis & Hemp/CBD Ancillary Companies
Cannabis and hemp ancillary companies provide support services for the industry. They do not work directly with hemp and cannabis products, though.
If you want to start a cannabis and hemp ancillary company, you will need to learn more about your options and decide whether you need loans to finance the operation.
What Is a Cannabis and Hemp Ancillary Company?
Cannabis and hemp ancillary companies do not need to follow as many regulations as businesses that handle cannabis flowers and other products. They still need to follow state regulations because they work alongside and support the cannabis industry.
The biggest difference between cannabis companies and cannabis ancillary companies is that the ancillary companies never come into direct contact with cannabis products. The industry often divides companies into those that are “plant-touching” and “ancillary.”
Ancillary companies can provide a broad range of services. Some popular options include:
Data platforms that help retail stores and manufacturers understand emerging trends within the industry.
Payment processors that avoid banks and credit unions worry that working with cannabis businesses will break federal laws.
Accountants that keep cannabis and hemp businesses on track to become profitable and file their taxes correctly.
Digital marketers that understand restrictions on cannabis advertisements and find creative ways to promote products without breaking regulations.
Attorneys who specialize in cannabis and hemp law so they can represent their clients effectively.
Point-of-sale software companies that make it easier for dispensaries and retailers to track their sales and stock.
Why the Cannabis and Hemp Industry Needs Ancillary Companies
As the cannabis and hemp industry grows, ancillary companies will become increasingly important. No industry can thrive without professional support services. Everyone from lawyers to software designers can help make the cannabis market grow over the next several decades.
The cannabis and hemp industry, however, often needs dedicated ancillary companies more than businesses that operate in other sectors. The fact of the matter is that cannabis cultivators, manufacturers, and sellers face considerable challenges. Each state has a complicated labyrinth of regulations.
Plus, the federal government still considers cannabis a Schedule I drug. Nearly all medical professionals agree that listing cannabis as a Schedule I drug is absurd. Cannabis has numerous medical applications. (The government considers Schedule I drugs to have no medical applications.) Patients use cannabis and hemp to treat a wide range of health concerns, including pain, lack of appetite, and depression.
Cannabis and hemp attorneys play a critical role in the industry. Without them, businesses would not have knowledgeable professionals to represent them in legal matters.
Accountants and payment processors also play essential roles. Federal laws make it nearly impossible for banks and credit unions to have any contact with the cannabis industry. Payment processors offer solutions that help companies get paid without using the traditional banking system.
Accountants are needed because cannabis companies must pay federal taxes on the revenue they earn. Unfortunately, the IRS will not let them list many business expenses. As a result, cannabis businesses often pay higher tax rates than companies in other industries. Accountants know how to lower that unfair burden as much as possible without breaking federal tax laws.
Forming a Cannabis or Hemp Ancillary Company
Since cannabis and hemp ancillary companies don’t sell cannabis products, they should have access to business loans through banks and credit unions. Most banks and credit unions, however, take a highly conservative approach to lending. The federal government can make it impossible for them to operate, so they worry about looking like they might not follow every aspect of the law. It makes sense for them to be as careful as possible, but it puts cannabis and hemp ancillary companies in a difficult position.
Private lenders make it much easier for cannabis and hemp ancillary companies to access the loans and financing they need to start or grow their businesses.
Private lenders can offer a variety of services, including:
Real estate loans that help businesses purchase properties where they can operate.
Equipment loans to fund the purchase of computers, furniture, and other essential items.
Working capital loans that provide short-term funding when ancillary companies face financially difficult months.
More often than not, cannabis and hemp ancillary companies face fewer barriers than cannabis cultivators and storefronts. Still, they regularly find themselves turning to private lenders for the money they need to start businesses or expand so they can serve more clients.
Canna Business Resources Can Help You Fund Your Cannabis or Hemp Ancillary Company
Working with a private lender can feel intimidating when you need funding for a cannabis or hemp ancillary company. You might not even know where to start looking for loans.
Canna Business Resources can help you explore your options, fill out applications, and secure the funding you need for your business to thrive.
Start by filling out an initial inquiry that gives us basic information about you and your business. A Canna Business Resources consultant will contact you shortly to talk about your funding options. Your consultant can walk you through each step until you find a loan that meets your needs.
You don’t have to apply for loans on your own. Get assistance from Canna Business Resources so you can make an informed choice that will grow your business and help you save money in the long run.