The legalization and regulation of marijuana use paved the way for the weed manufacturing industry to become one of the fastest-growing businesses in the last few years.
Scruffy hippies getting high in a disorganized underground economy — this was how the weed manufacturing industry was painted in the (not too distant) past. But today, the new marijuana manufacturing business is growing, and it’s nothing like you’ve ever imagined.
What Is Weed Manufacturing?
Weed manufacturing refers to the process of yielding, reproducing, deriving or preparing, manufactured weed products. This process of weed manufacturing can be done either indirectly or directly, using extraction techniques, chemical synthesis, or a combination of both. The industry continues to grow rapidly as more consumers are beginning to understand the benefits of taking weed products in health and fitness, medicine, and even beauty.
Subsequently, as the demand for various marijuana products increases, more investors are showing interest in starting a cannabis-related business. The entire weed industry is flourishing, and as this sector continues to develop at a fast pace, there is lots of money to be made. If you’re thinking of going into a large-scale operation, there are many marijuana processing equipment available that can help you kick-start your business.
But be prepared. Starting a weed business is not easy, as there are laws and regulations that you have to consider first depending on the state or country you’ll be operating from. So, you might want to plan this carefully. It’s also best to consult with lawyers and check with regulating bodies first to make sure your business will be compliant with the laws in place.
For recreational use, marijuana is currently legal in 15 states. But for medical use, it’s legal in 35 states, and these numbers are expected to grow in the coming years. Traditionally, hash, flower, and handmade edibles were the only cannabis goods available to consumers in the underground market. In today’s legal market, weed products are available in more forms like oils, concentrates, cannabis-infused drinks and foods, and products containing tetrahydrocannabinol (THC) like dry powder inhalers, and transdermal patches. It’s no wonder why there’s a sudden increase in the number of weed manufacturing companies regardless of strict state regulations.
But aside from the facts cited above, there are more interesting things about the weed manufacturing industry:
Its Sales Growth Is Rapidly Increasing
Since the changes in government laws, with more states legalizing its use, the market for legal marijuana was projected to skyrocket. And true enough, according to Forbes, legal marijuana sales in the U.S. alone went up by 46% in 2020. This increase led to an all-time high of USD$17.5 billion, which means Americans are consuming more weed than ever.
Furthermore, several new cannabis firms are pursuing research and development, testing, and production. In Canada, many regions are anticipating the privatization of cannabis retail outlets. Many provinces that formerly picked a single supplier are now asking numerous vendors to submit their bids to meet the increase in demand.
In a recent market analysis report, the value of the worldwide legal marijuana market was appraised at USD$ 9.1 billion in 2020 and is anticipated to have a 26.7% increase in compound annual growth rate (CAGR) from 2021 to 2028. It can be said that the growing demand for legal marijuana is driven by the increasing number of states and countries legalizing the use of cannabis.
It Produces Innovative Products Too
With its legalization, marijuana users are eating their cannabis more than ever, rather than smoking it. Between January and August 2018, the market share of edibles in Oregon and Colorado increased to 24%, with sales for other edible products growing even faster. Cannabis-infused chocolates, for example, grew by 135% in Colorado during the same period.
Aside from edibles, many other variations of cannabis products—such as topical oils applied to the skin and sublingual dosages that dissolve beneath the tongue—have gained traction since legalization, but they don’t account for the majority of sales in the market. Low-dose products for medical patients or smokers who prefer a softer high have also grown in popularity, with sales in Colorado increasing by 83% in 2017.
It Makes CBD More Accessible
Cannabidiol, or CBD for short, is a type of cannabinoid responsible for the majority of cannabis’ medicinal benefits. CBD may be separated and purified from THC, marijuana’s major psychoactive component, to create oils and tinctures for patients who want to benefit from the drug’s anti-inflammatory and relaxant effects without getting ‘the high.’ In areas where CBD is legal, these medicines are readily accessible and utilized as home treatments for anxiety, nausea, chronic pain, epilepsy, and even acne.
It Creates Employment Opportunities
The cannabis business is expanding so quickly that the number of employment opportunities in this industry has tripled since 2016. According to Marijuana Business Daily, the weed industry employs between 125,000 and 160,000 full-time workers. By 2022, it is anticipated to add another 340,000 full-time employments, representing an annual growth rate of 21%.
Weed manufacturers were able to hire a large number of people now that the demand for marijuana has increased tremendously. In 2020, cannabis firms have employed more than 200,000 full-time workers in various areas of the medicinal and recreational cannabis industries, including budtenders, machine operators, legal clerks, and more.
It Generates Tax Revenue
Marijuana sales in Colorado and Washington have been higher than in recent years, resulting in increased tax revenues. Colorado earned more than $302 million in medicinal and recreational marijuana taxes and fees in 2019 as a result of more than $1.7 billion in sales. According to a research by Arcview Market Research and BDS Analytics, sales in the United States reached $12.2 billion in 2019 and are expected to rise to $31.1 billion by 2024.
Backed up by local evidence, a recent analysis from Colorado State University Pueblo’s Institute of Cannabis Research found that a contribution of more than $80.8 million in the local economy can be attributed to the legal cannabis sector because of tax revenues. Furthermore, according to a study by New Frontier Data, an accredited cannabis analytics firm, state-legalized marijuana may produce an additional $105.6 billion in federal tax revenue by 2025.
The legalization and regulation of marijuana use paved the way for the weed manufacturing industry to become one of the fastest-growing businesses in the last few years. And as more countries begin to accept its true benefits beyond recreational use, the industry will only continue to grow and expand to reach more consumers with countless innovations.