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Starting a Cannabis Plantation with Packaging Equipment Financing

Posted On: February 8, 2023 author Paul Kendall

Planning to start a cannabis plantation business?

A cannabis plantation business can generate a lot of profit, so it can be a good investment. The cannabis industry is booming and demand for cannabis is still rising. That being said, don’t expect everything to be smooth sailing if you enter this industry.

More so than with other types of business, the laws hedging in cannabis businesses are very strict. With that said, you can expect to have problems regarding financing as well. The latter can be especially problematic since a cannabis plantation requires certain equipment. Without that equipment, it can be difficult to grow good quality cannabis. Most equipment for a cannabis plantation is expensive, unfortunately -- especially the ones you need for packaging. Luckily enough, you can always try to get packaging equipment financing.

In this blog post, we’ll talk about starting a cannabis plantation business and how packaging equipment financing can help.


Setting Up Your Cannabis Business


Packaging equipment financing will give several benefits to your business. But before we start talking about that in particular, let’s set up your cannabis plantation business first. The thing is, you can have problems in your cannabis plantation business even before you start operations. A lot of the problems for this type of business come during the startup phase. Most issues will involve money, as mentioned earlier, especially when you’re buying equipment. But you can easily solve the worst of them with packaging equipment financing.

However, using packaging equipment financing can’t resolve all of the problems you’ll face. So, to help you out with that, here are some tips for starting your cannabis plantation business.  

Plan Your Cannabis Plantation Business


Before you get packaging equipment financing, you need to plan your cannabis plantation first. You need to have a plan because there are many types of businesses within the cannabis industry. Each of them has a different set of requirements. Also, the level of difficulty in making the business successful may vary. Some businesses in the cannabis industry require more working capital than others.

For example, you need to acquire more expensive equipment if you choose to set up a cannabis plantation in particular. Lighting equipment financing for your grow operation is hard to find and buying all the lighting is expensive. You need to acquire the best and most reliable lighting equipment so you can grow high-quality cannabis. Furthermore, you’ll have to invest in high-capacity and often-expensive packaging equipment for your product.

That’s why packaging equipment financing is vital for those setting up plantations, as I said earlier. In fact, even other types of equipment financing may be called for. Having said that, make sure that you plan your business first to avoid having problems during your startup phase and with the use of latest technology. You need to plan your operations so you can budget your working capital evenly.

When you create a business plan with proper cash flow, be sure to address different aspects of your operations like the following:

  • A list of your needed equipment and the cost justification
  • Forecast expenses and profits.
  • Outline of your operations.
  • Your plan for getting all the necessary funds.




Find the Best Location


You should also find the best location for your cannabis grow business even your food and beverage business. This can help you become more profitable, repay packaging equipment financing easily, and more. That’s because your location is the key to your success. If you have a cannabis grow plantation, the location will play a major part in determining to whom you can sell, what your expenses are, etc. So, how do you pick a location that will benefit you? When you choose a location, pick one that’s near your target market. Particularly, you need to pick a place near dispensaries. You should be able to deliver cannabis in no time so you can earn money quickly.

Also, your facility should be in a place where you can grow cannabis easily. You must pick a place where the weather allows you to grow cannabis without complications. Keep in mind that renting a place can cost a lot of money, by the way. That’s why you have to  make sure that you can get ROI from your chosen location.  In that way, you’re more likely to hit your goals faster. That can be critical if you’re repaying loans you used to set up the business, like packaging equipment financing and lighting equipment financing. Lastly, don’t pick a facility or building that needs a lot of repairs. This can swell your setup expenses.

Pick a place where you can start your operations immediately to get profits. This is the best way to use packaging equipment financing or any other form of lighting financing you get for your grow business properly.

Register Your Grow Business


Before you get packaging equipment financing or a loan for lighting, HVAC and dehumidifiers, it’s best to register your business first. You need to register your business to assure lenders that whatever they lend you will be put to good use. First, because it demonstrates that you take your business seriously. Second, it tells them that you’re unlikely to run into legal issues. A registered business is more likely to be in accordance with the law.

Keep in mind that marijuana isn't legalized at the federal level. National prohibitions prevent the interstate sale of cannabis. In short, the authorities may consider you illegal if you don’t have the right permits and licenses. Anyway, there’s no specific way to register your cannabis business. Each state has different laws on starting a cannabis plantation. That is, there are different types of business licenses, permits, and registration practices needed depending on your location. It’s best to check the laws in your area to see the requirements for your cannabis business. Also, try to contact a legal professional in your state to get more specific assistance. Lawyers can help you sort everything you need to properly register your cannabis plantation. They can also tell what to do to get the proper permits and short term loans.

Having the right permit and license to operate is a good way to start your cannabis plantation. That's also the only way you'll get packaging equipment financing from an equipment finance company for your grow operation.




Plan How to Acquire Your Grow Equipment


When you start your cannabis plantation, you need to plan how to acquire equipment. The way you acquire your equipment can determine your success. That’s because the equipment you use contributes a great deal to the quality of your operations. It can even affect the quality of your products. However, not all equipment for a cannabis plantation is easy to acquire. Some pieces of equipment are very expensive. To open a cannabis plantation, you need to get equipment for your ventilation systems, heating systems, and lighting systems. Some lenders will only work with certain vendors.

So make sure your equipment lender will work with your chosen vendor or see if your equipment lender has some equipment vendors they could recommend. The packaging equipment will lessen the time required to prepare your products. You can also ensure that there will be no wasted cannabis during the packaging. Using good packaging machine will reduce errors. This ensures that none of your cannabis will go to waste.

Now, technically, you can use your own working capital to acquire your equipment. However, for most startups, it’s best to get working capital from lenders for it instead. It’s not advisable to use your working capital on acquiring the equipment you need if you have limited funds. This might drain your working capital, you see, and give you financial problems during your future operations.


Using Packaging Equipment Financing


When you look for additional funds to get equipment, it’s recommended to get packaging equipment financing in particular that involve monthly payments. Packaging equipment financing gives you additional funds for getting packaging machinery, obviously. It’s a good choice for most cannabis plantation startups because this machinery is very costly, as I said earlier.

Now, packaging equipment financing generally comes from equipment financing companies. It typically represents a better option than applying for a loan from a bank.  This is because it’s near-impossible to get a bank loan if you’re in the cannabis industry. Most banks don’t lend working capital to cannabis businesses because they’re often linked to activities of dubious legal status. Other than that, they usually won’t give loans to startup businesses either. They often have strict business loan requirements that favor established and large businesses instead. And even if you have a chance to get a working capital loan, the application process with banks is usually very lengthy. That’s why you should choose packaging equipment financing instead.

Most equipment lease companies have an easy application process. You can get the additional funds right away too, in most cases.

Final Thoughts on Packaging Equipment Financing


In this blog post, we talked about starting a cannabis grow plantation business and how packaging equipment financing can help you pay for all the packaging equipment you'll need. You can combine all the other grow equipment you'll need into the same loan. The packaging equipment financing program can help you acquire some of the most important equipment for your grow operations. Particularly, it helps you acquire costly packaging equipment.

You need to have packaging equipment because it ensures that none of your cannabis will go to waste. Manually packing the cannabis can lead to errors and this could ruin your output quality and quantity. But before you get packaging equipment financing, create a business plan first. Plan where you will put your plantation and register your business. Make sure you acquire the right licenses and permits because the equipment lender won't fund the cannabis loan until you do. 

Doing the things mentioned in this blog post can help you start your cannabis grow plantation business on the right foot.

Once you’re ready to get additional funds, you might try getting custom packaging equipment financing from Trust Capital. They’re one of the most reliable providers of equipment financing for businesses in the cannabis industry.

To get pre qualified for all your cannabis equipment acquisition needs, contact Trust Capital at (866) 458-4777.

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