The 3 biggest challenges facing the cannabis industry towards 2022

by druginc

The 3 biggest challenges facing the cannabis industry towards 2022

Given the sales figures that marijuana has made in the past year, it's hard to imagine that there were actually hurdles to overcome. In both 2020 and 2021, the cannabis industry was a force to be reckoned with. In fact, the legal cannabis market as a whole is expected to be worth a staggering $2028 billion in total by the year 70.

While the nascent industry has lofty goals, they will not be achieved without overcoming some hurdles. Here are some of the biggest it will face in 2022.

Market volatility as new players continue to enter the industry

Given the amount of new markets that have emerged in recent years cannabis have legalized it, it's no surprise that space is getting crowded. Entrepreneurs around the world have recognized the lucrative opportunities when it comes to the cannabis industry. In the second half of 2021 alone, cannabis investment peaked at 85%.

Given that the potential revenues that can be earned from investments in the cannabis industry are known, it is only natural that new entities eventually enter the fray. As new investors get involved, it's likely they have inaccurate expectations about when they'll be able to deliver returns. Those inaccurate expectations for quick returns, along with a lack of regulatory action, mean that the volatility that currently exists within the cannabis industry will continue to be an obstacle into 2022.

More competition from brands producing synthetic cannabinoids

Another obstacle that the cannabis industry must overcome in the year 2022 is an influx of competition from producers of Delta-8, Delta-10 and THC-O-Products.

One of the biggest reasons the synthetic cannabinoids market poses a threat to the recreational marijuana industry is the fact that, for example, many states in the United States allow the online sale of these types of products. The fact that synthetic cannabinoids can be easily ordered just like any other consumer good means that they are more easily accessible for most consumers than recreational cannabis products. This could provide a level of competition in 2022 that the recreational cannabis industry may or may not be willing to fight.

Determining what consumers expect from cannabis brands

In most consumer sectors, getting to the heart of customer sentiment can be as easy as sending an online survey. But with the vast majority of transactions in the cannabis industry being in-person and cash, it's hard to get an idea of ​​what customers would change about their experience with a cannabis brand. Still, recreational cannabis brands are tasked with staying ahead of the curve when it comes to meeting customer needs. The cannabis brands that know how to do that effectively will be well positioned to stay ahead of the competition.

Because recreational cannabis sales are still illegal in many countries, it is difficult to keep in touch with customers to gauge their level of satisfaction. Without POS systems, it's nearly impossible to keep customer data handy, but getting creative cannabis entrepreneurs should help them find other innovative ways to tap into the heart of customer sentiment.

When most people talk about the recreational cannabis trade, the main focus is on how exciting it is that the industry is growing at such a rapid pace. Unfortunately, that's only one side of the coin. The challenges it faces are obvious and will not be easy to overcome. However, 2022 still aims to be one of the most exciting years yet for the fledgling, booming industry.

Sources including Finance (EN), FreshToast (EN), Prohibition Partners (EN), WKBW (EN)

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