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High times in business: navigating the cannabis industry

The landscape of cannabis legalisation is rapidly evolving worldwide, and the United Kingdom is no exception. With changing attitudes towards cannabis and a growing acceptance of its medicinal and economic benefits, entrepreneurs are increasingly interested in establishing legal cannabis businesses in the UK. CBD products are legal as long as they meet specific criteria, such as containing less than 0.2% THC (the psychoactive compound in cannabis) and not making medicinal claims. A quick disclaimer, this is by no means any medical advice to take any medicinal cannabis products but more of an exploration into the growing industry.

So what is CBD (as I'm sure you have heard these three letters floating about)? CBD is one of many chemicals called cannabinoids. It is found within hemp and cannabis. Before diving in, it's crucial to grasp the UK's current legal stance on cannabis. Cannabis is classified as a Class B drug under the Misuse of Drugs Act 1971. With that being said I can only imagine that setting up a legal business within this industry can be a tough task. However, there is a legal framework for the prescription of cannabis-based products for medicinal use in very limited circumstances. The UK Government has its own factsheet that gives information on domestic control measures applicable to cannabis, cannabidiol (CBD) and controlled cannabinoids; this is for both existing and prospective licensees. If we look at 'The Medicines and Healthcare products Regulatory Agency' which regulates medicines, medical devices and blood components for transfusion in the UK - they have acknowledged the growing interest in the cannabis industry and have provided a a blog article dedicated to explaining obtaining a license which you can view by clicking the picture just below.

Setting up a cannabis business in the United Kingdom can be challenging due to the complex legal and regulatory framework surrounding cannabis. The UK has a limited number of licenses available for the cultivation, processing and distribution of cannabis for medicinal use. Competition for these licenses are high and the selection process is rigorous, but it is not unachievable.

If this was an industry you were considering you would need to decide what type of cannabis business you want to establish. Options include medical cannabis cultivation and distribution, cannabis-based product manufacturing, or retailing CBD products, which contain no or very low levels of THC (the psychoactive compound in cannabis). For example on the below video you have retired Olympian & professional boxer Anthony Fowler, the business founder of Supreme CBD. The company has collection of CBD gummies, oil and capsules, so you see here the range of cannabis products that are currently on the market.

Now earlier I mentioned compliance & legalities that specifically related to cannabis but it's important to note depending on your chosen business model, you may need licenses from various government bodies. For example, CBD retailers must comply with the Food Standards Agency (FSA) regulations as "there is still a lot we don’t know about CBD extracts, and there has been very little research about the effects they may have."

To keep you a bit more clued up with the scientific breakdown of CBD products and each individual niche, RSV Media provides you a step to step guide of identifying your niche that may be of interest as well as the differences between them. The legal cannabis market in the United Kingdom is primarily focused on CBD (cannabidiol) products, as THC (tetrahydrocannabinol) remains a controlled substance. I will list specific products just to give you an idea of the scope & range of CBD products:

1. **CBD Oils:** CBD oils are one of the most popular CBD products in the UK. They come in various concentrations and are taken sublingually (under the tongue) for potential health benefits.

2. **CBD Capsules:** CBD capsules or soft gels contain pre-measured doses of CBD and are taken orally like traditional supplements.

3. **CBD Edibles:** CBD-infused edibles include gummies, chocolates, and other snacks. They offer a tasty way to consume CBD.

4. **CBD Topicals:** CBD creams, lotions, and balms are applied directly to the skin and are used for localized relief from pain, inflammation, or skin conditions.

5. **CBD Vape Products:** Some retailers offer CBD vape pens, e-liquids, and cartridges for those who prefer inhalation as a delivery method.

6. **CBD Drinks:** CBD-infused beverages, such as teas and sparkling waters, have become increasingly popular and are available in various flavours.

7. **CBD Isolate:** CBD isolate is a pure form of CBD in crystalline form, often used by consumers who want to control their CBD dosage precisely.

8. **CBD Pet Products:** CBD-infused pet treats, oils, and capsules are designed for pets and may offer potential health benefits for animals.

9. **CBD Skincare Products:** CBD has been incorporated into various skincare products, including serums, masks, and creams, for potential benefits to the skin.

10. **Hemp Products:** Hemp-based products, such as hemp seeds, hemp oil, and hemp protein, are available for purchase in health food stores and online retailers.

Setting up shop can involve a lot of factors: Establishing a cannabis business can be capital-intensive. You may need funding for licensing fees (A new licence application to cultivate cannabis with a THC content of 0.2% or lower will cost £580. Depending on the cultivation method you require this can be up to £4700), facility construction, equipment, and working capital. You may need to explore options like private investors, venture capitalists, or business loans. For cultivation or manufacturing you would need to choose a location that complies with zoning laws and provides adequate space and security. This is especially important for security reasons- "should be sited sensitively in locations away from schools, public rights of way or vehicular access and not drawing attention to it". You can find more guidelines on the government hemp licensing guide.

You are probably aware of a few notable celebrities who have their hands in the cannabis industry, this is partly what drew my attention to the cannabis industry. I have highlighted a few below that immediately sprung to mind, feel free to click the images which will take you to the website of each company:

1. **Willie Nelson:** The iconic country musician Willie Nelson has his own cannabis brand called "Willie's Reserve." His brand is known for its dedication to sustainable and high-quality cannabis products.

2. **Mike Tyson:** The former heavyweight boxing champion Mike Tyson has entered the cannabis industry with his brand, "Tyson Ranch." It includes products such as premium cannabis strains and a cannabis-themed resort.

3. **Martha Stewart:** The lifestyle and cooking expert Martha Stewart partnered with Canopy Growth Corporation to create a line of CBD products for both humans and pets.

4. **Tommy Chong:** Tommy Chong, one half of the comedy duo Cheech & Chong, has long been an advocate for cannabis legalisation. He's associated with "Chong's Choice," a brand that offers a variety of cannabis products.

5. **Jim Belushi:** Actor and comedian Jim Belushi owns a cannabis farm in Oregon called "Belushi's Farm," where he cultivates and sells cannabis products.

These celebrities have used their influence and passion for cannabis to enter the industry, contributing to its growth and normalisation. Please note that the extent of their involvement in the cannabis industry may vary, from branding and advocacy to direct investment and business ownership. As you may have noticed these celebrity examples are outside of the UK and mainly in the US. I wanted to highlight this to exemplify that the UK is not yet at the stage of USA or Canada in terms of their attitudes towards the acceptance of CBD/cannabis for medicinal use; the UK is still very much conservative although this stance is loosening as time goes on.

One thing I wanted to note is although these celebrities may be the face of these large CBD & cannabis corporations they most likely have a strong team behind them. If you were to start off in the industry just like these celebrities it is likely you also would need to assemble a team who have some level of expertise in the cannabis industry, including horticulture, pharmacology, legal compliance, and marketing.

CBD is a very sensitive and delicate subject and this is one of my most sensitive blog post to date. I don't want to bore you with non stop regulations & legalities but it is important to emphasise this to you so you get a realist expectation of the barriers to entry in this lucrative industry.

I have discussed compliance and regulation in detail earlier in the post but it is important to note cannabis laws and regulations in the UK are always subject to change. Staying up-to-date with evolving regulations and adapting your business practices accordingly is essential but can be challenging. Strict regulations can be also related to product quality, safety, labelling, and packaging. Ensuring compliance with these regulations can be complex and costly. Many traditional banks and financial institutions are hesitant to work with cannabis businesses due to legal and reputational risks. This can make it challenging to access essential banking services and financing.

Research into the medical benefits of cannabis is still in its early stages in the UK. Conducting research and clinical trials on cannabis-based products can be difficult due to legal and regulatory constraints. Cannabis advertising is heavily regulated in the UK, promoting cannabis products can be challenging limiting your ability to market your business effectively. Establishing a secure and compliant supply chain for cannabis products can be complex, from sourcing raw materials to distributing finished products. Despite changing attitudes toward cannabis, there may still be a stigma associated with the industry. Building a positive public image and overcoming negative perceptions can be a challenge. The global cannabis market is competitive and UK-based businesses may face competition from established players in countries with more permissive cannabis regulations. Finding insurance coverage tailored to the unique risks of the cannabis industry can be challenging and premiums can be high. If you click the image below Park Insurance breaks down the technicalities involve in securing insurance if you want to legalise a cannabis farm.

Despite these challenges, some entrepreneurs and businesses are successfully navigating the UK's cannabis industry. It's crucial to seek legal counsel and thoroughly research the specific requirements and regulations in your region before attempting to establish a cannabis business in the UK. Additionally, staying informed about changes in legislation and market dynamics is essential for long-term success in this evolving industry. Now what's an AKERS WORLD blog without a book recommendation? I have picked out the below books to help you understand the cannabis laws and what entering the industry entails. You can click each book below to have a browse and purchase.

Setting up a legal cannabis business in the United Kingdom is a complex and highly regulated process, but it's not impossible. With the right knowledge, resources, and a commitment to compliance, entrepreneurs can navigate this emerging industry successfully. However, it's essential to consult legal experts who specialise in cannabis law to ensure that your business operates within the bounds of the law as regulations constantly evolve.



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