The Importance of Business Associations in the Cannabis Industry

By Claudia Post

Due to the novelty and volatility of the cannabis industry, business associations are particularly important in shaping the trajectory of the market. From advocating for legislative reform to providing networking opportunities, these associations are catalysts for growth and innovation.

Due to federal prohibition, different U.S. states are forced to develop their own rules and regulations concerning their treatment of cannabis businesses. With no “one size fits all” blueprint, the disparate nature of the cannabis industry presents both challenges and opportunities for business owners. In turn, an association or group can fill a much-needed void for resources, stability, and direction in this ever-changing landscape.

What is a Business Association?

A business association is an organization formed by like-minded business owners and executive leaders who operate in similar industries and regions. In turn, these groups offer resources and support for members to exchange ideas, address challenges, and achieve common goals.

Popular business associations in the U.S. include:

U.S. Small Business Administration (SBA)
National Women’s Business Council
U.S. Chamber of Commerce Small Business Council
American Marketing Association (AMA)

Besides such obvious large organizations, smaller groups focused on specific locales can address the specific needs of individual businesses. For example, Investopedia explains, that your local chamber of commerce is a great option to help “shape policy that relates” across the “overall economic environment” where you conduct business.

What Do Business Associations Do?

Business associations are groups of people who work together to promote common interests. As Inc. explains, “These associations typically perform activities that would be unduly costly or time-consuming for an individual company to perform by itself, including lobbying, information gathering, research, and setting industry standards.” While large business associations focus on ambitious goals like lobbying, small business associations are often more focused on benefits for individual members - like networking and sharing resources.

Business Associations in Startup Industries

Business associations are particularly impactful in startup industries like the cannabis space. Since standards aren’t in place for things like employee training and good manufacturing practices (GMP) in new industries, it's often up to business owners to work together in creating best practices. In turn, as the cannabis industry matures, it is often these methods that are adopted by universities for professional training and regulatory bodies for compliance standards.

Why are Business Associations Important for Cannabis?

From business networking to promoting cannabis advocacy efforts, several benefits come from joining a cannabis business association.

Learning Best Practices

No matter what industry you work in, all companies follow a set of best practices to establish standards among peers. When you join a business association in the cannabis industry, you get an inside view of important standards like product quality, lean operating, workplace safety, and more. Since the industry is changing so fast, being familiar with best practices can be the difference between success and failure.

Business Networking

Especially if you operate an ancillary business that services other cannabis companies in a B2B capacity, a business association is a great way to network and meet prospective clients. After all, what better way to make a new business connection than to meet in person and shake their hand? Even better, working together to achieve a common goal is a great way to vet potential business partners.

Industry Training

Since compliance is such an important topic in the cannabis industry, associations allow businesses to exchange information on training protocols. Whether you are curious about OSHA standards for your cultivation and harvest team or need to train your delivery drivers about seed-to-sale tracking protocols, having other cannabis business owners accessible is a great way to stay ahead of the curve. Moreover, well-organized business associations should run regular workshops and seminars to keep members up to speed on industry trends.

Cannabis Advocacy

While public opinion has taken a dramatic turn in favor of cannabis in recent years, there is still a long battle to be fought for federal legalization. In turn, business associations are the perfect catalyst for like-minded people to collaborate and advance advocacy work in their respective areas. Examples of important advocacy work still being done in the industry include social equity licensing and the need for legitimate scientific research into the benefits of medical cannabis.

Established Cannabis Business Associations

Due to the semi-legal nature of the cannabis industry, the market has given rise to diverse business associations that seek to tackle different goals. While one association might be exclusively focused on advocacy, another might deal more with business-related topics.

Popular cannabis business associations include:

National Organization for the Reform of Marijuana Laws (NORML)
National Cannabis Industry Association (NCIA)
Americans for Safe Access (ASA)
American Trade Association for Cannabis and Hemp (ATACH)

Since new opportunities in cannabis are reliant upon new legalization measures, advocacy work and business expansion often go hand-in-hand in the industry.

How Do I Join a Cannabis Business Association?

If you are interested in joining a cannabis business association, start by researching groups relevant to your location and sector in the industry. After that, check the organization’s eligibility criteria, membership benefits, and financial dues. Typically, you can apply online or through a membership form provided by the association.

If you aren’t sure if a cannabis business association is right for you, try attending networking events or conferences to familiarize yourself with its members and activities. At that point, you can gauge whether the association will be a good use of your time and resources.

Conclusion

Due to the dynamic nature of the cannabis industry, joining a business association is a very smart decision. Since the cannabis market is still largely in the startup phase, groups like the NCIA help establish a solid foundation in untested business environments. Moreover, since each state market operates independently of one another, associations are instrumental in bringing together like-minded businesspeople from different parts of the nation.

Since they help with diverse goals ranging from business development to legislative reform, cannabis associations promote growth and innovation in the industry. By advancing best practices in critical verticals like product quality, lean operating, and workplace safety, these groups help push the entire cannabis industry forward. As the industry continues to mature, cannabis business associations will undoubtedly leave a strong legacy for up-and-coming entrepreneurs to follow.

About the Author

If you are interested in coming to Pennsylvania, please contact Claudia Post. Claudia Post is an entrepreneur, pioneer groundbreaker, speaker, and power connector. Having recognized cannabis as the next frontier 14 years ago, Claudia founded MOST Consulting Group which is a one-stop shop for cannabis businesses; providing marketing, advertising, design, and strategy for all verticals in the cannabis industry.

With her expertise in transportation, most recently she founded Scarlet Express, a state-approved delivery service that provides discreet, secure, and expert cannabis supply chain management in every state where legal.

Contact Claudia Post at cpost@mostcg.com or cpost@scarletex.com.

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