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How to start an online cannabis delivery business

By Tanvir Singh 7th January 2021

Many cultures around the world have a cannabis-infused rich history. The herb is phenomenally known for its medicinal and recreational use. It’s known to aid people suffering from mental illnesses like depression, anxiety, PTSD, ADHD, and more by mellowing down the symptoms. Marijuana mainly consists of two chemical compounds or cannabinoids – THC and CBD. The amount of cannabinoids present in a plant depends on the kind of strain it is. Indica strains are usually denser in CBD than THC, while it’s the opposite for Sativa plants. 

Considering the multiple uses of the plant, many states in the US have now legalized the recreational use of marijuana, with many dispensaries popping up in different forms throughout the country. The cannabis industry is estimated to touch 73.6 billion by 2027 in the US and record a remarkable CAGR of 18% during the forecasted period. [1] 

With marijuana becoming increasingly popular, the need for on-demand cannabis delivery services is shooting up as well. Though starting a delivery service for marijuana may sound complicated, a well-planned business sketch can help you get it off the ground pretty quickly. 

So, if you are a marijuana connoisseur or are just looking for a great business idea for your next online venture, this is it! In this blog, we will walk you through the steps you can take to set up your online cannabis delivery business seamlessly!

Understand the legalities – the permits, licenses, and such

Let’s get this right off the bat – marijuana is not legal at the federal level. However, a few states permit the use (medical or recreational or both) with certain restrictions.

It would be best if you did your homework before you think about launching your marijuana delivery business. Different locations are governed by varying laws. Check your state’s law and stance on cannabis.

Once you are thorough with the laws, it’s time to apply and acquire the necessary permits and licenses. Two scenarios come while obtaining a business permit for cannabis distribution

You are affiliated with a storefront dispensary – This is usually the case for business owners who already have an operational offline dispensary. Here, you will need a regular Retailer business license.

You are not affiliated to a storefront dispensary – In this case, you will need to get a Retailer Non-Storefront business license. In which case, you will need to procure a physical premise, but it won’t be accessible to the public.

You will need to complete the Cannabis Retailer Application before you invest in the business. The information is provided by The Bureau of Cannabis Control here.

It’s also recommended to consult a legal expert who can educate you on your state’s cannabis law’s nitty-gritty and nuances. Make sure you are not leaving out any necessary documentation.

Be steadfast with delivery compliance. 

As a highly regulated market, cannabis distribution comes with strict rules that you will need to follow as you start your business. Delivering marijuana works a bit differently than it does for other commodities like food, supplies, etc. You will need to know what counts as a violation to avoid getting into a sticky situation. Make sure your drivers are thorough with the delivery rules in your city and state. 

Your delivery drivers must be competent and reliable people with a strong work ethic. Any carelessness from their end can get your business in jeopardy. By law, they are required to –

  • Be at least 21 years of age.
  • Carry the necessary documentation that proves they are allowed to distribute cannabis – business license, driver’s license, and employer ID badge.

Other important things to note are –

  • Drivers must not be under the influence of cannabis of any form.
  • All delivery vehicles must have an active GPS tracking device installed in them at all times.
  • Most states do not allow carrying products worth more than $3000 at any instant.

You will also need to make sure that you have a robust dispatch system to ensure all deliveries are fulfilled in time and to the right customer. A delivery system like Tookan makes it easy and efficient for you to track, manage, and coordinate your delivery fleet in real-time!

Procure your stock

It’s pivotal to find a source that is reliable and trustworthy to acquire your marijuana stock. You will find many dealers in the market who trade the plant without the licenses and permits. It would help if you stayed clear of any illegal cannabis suppliers.

It won’t be an issue if you’re already running a legal dispensary, of course. However, if you are planning to launch your marketplace, you can either –

  • Tie up with a dispensary and handle their online deliveries.
  • Find a legal wholesaler who can source your inventory for your stock.

Although complicated and time-consuming, you can even consider starting your farm if you want to.

Marketing your online cannabis delivery business

As a legal yet tabooed product, marijuana comes with its marketing challenges. But first off, get your business listed on all social media platforms that you know your customers frequent. Cannabis has a market consisting of users from all age groups, so bear that in mind. 

Get your word out through Instagram and Twitter. You’re likely to reach middle-aged to older people on Facebook. Tik Tok is another excellent platform to reach your younger audiences these days. 

Working your way up through digital marketing is another sure-shot way of getting traffic on your website. However, online paid advertising is mostly restricted to cannabis businesses. Social media platforms are federally governed, which means running paid ads on them is prohibited. The same holds for Google Ads.

Ergo, getting organic traffic through smart SEO practices. Gearing your website and content as highly SEO optimized will help you increase your online footfall. The stigma around cannabis mostly arises from misinformation; making your marketing content educational and informative may help you disperse the unawareness, building credibility for your brand.

Building your online cannabis delivery app

The presentation and efficiency of your app will speak for your business. It is particularly essential as you will want to nurture a positive brand perception in your customers. You will need a user-end app, vendor app, and an admin dashboard to manage your sales.

An efficient customer app should have the following features:

  • Smooth registration with secured identity and age verification system
  • Easy search and select component with relevant filters
  • E-wallet options
  • Real-time GPS tracking

The app for vendors should have features to handle orders, payments, product catalogs, and refunds.

Along with these, you will need a unified delivery management system that helps you manage your orders safely. It should include driver verification, status updates, real-time tracking, and other crucial information to a safe fulfillment of an order.

Build your online cannabis delivery business with Yelo and Tookan today!

Yelo online marketplace builder can help you get started with your cannabis delivery business with just a few clicks. You can design your delivery business with Yelo, which is made to fit your business model!

With delivery being the most crucial bit of running a cannabis business, you will need a competent fleet management system that gets the work done! With Tookan, you can easily oversee your orders with a click! 

With route optimization, automated dispatches, and a live chat feature, you can deliver cannabis products to your customers with ease.

Sign up and find out how Yelo and Tookan can help you kickstart your cannabis delivery business right now!

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