Marijuana Business Factbook 2019

260 Marijuana Business Factbook 2019 Chapter 6 | Cannabis Testing Labs and Ancillary Firms © Copyright 2020, Marijuana Business Daily , a division of Anne Holland Ventures Inc. You may NOT copy this Factbook, or make public the data and facts contained herein, in part or in whole. For more copies or editorial permissions, contact CustomerService@MJBizDaily.com or call (720) 213-5992, ext. 1. CHART 6.08: Ancillary Companies: Top Five Challenges Source: 2019 Marijuana Business Factbook © 2019 Marijuana Business Daily, a division of Anne Holland Ventures Inc. All rights reserved. Ancillary Companies: Top Five Challenges Federal Laws/Intervention Insufficient Number Of Vendors/Partners Licensed Competitors Cost/Complexity Of Compliance Other 8% 9% 10% 11% 31% Ancillary Technology & Products Companies Federal Laws/Intervention Cost/Complexity Of Compliance Taxation Fundraising Insufficient Number Of Vendors/Partners 10% 11% 12% 19% 25% Ancillary Services Companies Percent of Survey Respondents Both ancillary services firms and technology and products companies identified federal laws and intervention as the top challenge facing their businesses ― though technology and products firms did so at a slightly higher rate. The challenges for each type of operation diverge from there. For services companies, the costs and complexity of compliance with state and local regulations was the No. 2 challenge ― likely due to the nature of the businesses. Lawyers, marketing professionals and accountants, for example, must have a deep understanding of the intricacies of the varied rules governing cannabis in each jurisdiction. These businesses also noted difficulty with taxation, fundraising and an insufficient number of vendors or partners. Ancillary technology and products companies cited an insufficient number of vendors and partners and competition from other licensed companies (as opposed to illegal market competition) as two of their top three challenges. This might be an offshoot of the competitive environment facing ancillary technology and products companies. Within the “other” category, challenges identified by ancillary technology and products firms included safety and quality issues, overregulation of packaging requirements, clients’ lack of knowledge about cultivation, state laws regarding allowable pesticide limits in extracts, promotion, connecting with new/potential clients and copyright limitations.