Breaking into the Cannabis Industry: Is Manufacturing the Easiest Route?

Cannabis Executives Eye Manufacturing for Brand Expansion

Cannabis executives often view manufacturing as the sector with the most potential for launching a new brand or expanding into multiple states. Adam Wilks, CEO and chair of Las Vegas-based Carma HoldCo, the parent company of Tyson 2.0 and Ric Flair Drip, on Wednesday announced the arrival of the two multistate marijuana brands in Missouri. With its latest addition of Missouri, Carma HoldCo marijuana brands now sell in 19 states and three countries. The company hopes to add eight additional markets in the coming months.

Wilks explained that “expanding into new states through cannabis manufacturing can often be easier than through retail or cultivation.” He highlighted several reasons for this belief, including a more straightforward regulatory process, lower initial capital and infrastructure investment, the ability to distribute products across multiple retail outlets, and greater flexibility in product development.

Demitri Downing, founder of Marijuana Industry Trade Association USA and producer of the MITA Unshackled podcast, concurs that building a cannabis brand through manufacturing partnerships is “the easiest route to get in” to the marijuana industry. However, Downing cautions that this path is not without risk.

The Manufacturing Pavilion will feature 42 manufacturers from 25 states. “People can come learn about how each of those states works, meet potential manufacturing partners and, perhaps, cut a deal,” Downing said. The pavilion aims to create a vibrant hub where attendees can engage in discussions about deal flow and potential collaborations.

Broad Appeal of the Manufacturing Pavilion

Downing expects the manufacturing pavilion will attract a broad audience, extending beyond current manufacturing space participants. As wholesale flower prices drop in mature markets, licensed cultivators are increasingly considering extraction as a way to boost profits. Furthermore, with potential marijuana rescheduling on the horizon, large mainstream companies are exploring ways to enter the cannabis sector.

“Companies like Nabisco, like Amazon, the big companies should be interested,” Downing said. He emphasized that manufacturing centers are critical gateways to different interstate supply chains, making them attractive to a diverse range of consumer packaged goods (CPG) companies, including those specializing in vapes, edibles, gummies, concentrates, and pre-roll flowers.

Creating Buzz: MITA Unshackled Podcast at the Pavilion

At the heart of the manufacturing pavilion, MITA Unshackled will record back-to-back podcast sessions with leaders of renowned marijuana brands. “We’re going to be interviewing people from all these big brands as to their journey, how it occurred, the nuances, the pitfalls, choke points – and then different manufacturing centers as well, so people can come learn,” Downing said. The podcast sessions aim to provide attendees with valuable insights into the cannabis industry’s manufacturing segment, highlighting success stories and lessons learned from industry leaders.