Positions available: 1

Introduction

This project involves the development, commercialization and marketing of an analytic model to help prospective cannabusinesses (and consultants) enabling them to create the financials required for cannabis license applications and business plans.

Background

As cannabis becomes legal throughout the United States, it is necessary for license applicants to develop and provide business plans to regulating entities as part of the application process. Part of that business plan is a pro-forma statement identifying all anticipated revenue streams and expense line items. These financials are an important part of the application in that they demonstrate the viability of the business plan, ensuring that the entity will become a commercial success.

The model should be able to accommodate three types of cannabis businesses: 1) cultivation, 2) processing, and 3) retail (cannabis dispensaries).

Project Description

It is envisioned that the project would consist of three parts:

1) Model development – medical versus recreational, grower versus processor versus retailer.

a. Market research – conduct secondary (and to the extent possible primary) market research to gather statistics and information required for the development of the model(s). Although the methodology of the project is not entirely complete (and would be developed with the assistance of the professor and students), an initial assessment is that it would encompass the following factors:

i. Demographic data necessary to build the models (e.g., for the recreational program: age, marital status, political affiliation, etc.) for specific geographic areas of the US (e.g., zip code, area code, micropolitan, county, MSA, CBSA, etc.). For the medical program – the number of current and forecast medical patients within the selected geographic area.

NOTE: Selection of the appropriate geographic area for the model will be based on research results (e.g., the geographic area from which a recreational cannabis dispensary can be expected to draw its customers).

ii. The percentage of medical and recreational cannabis users by age, and other demographic characteristics (e.g., marital status, family status, political affiliation, likeliness to use different cannabis products based on age, etc.).

iii. The percentage of current cannabis users who would change their source from illegal suppliers when it became legal in New Jersey.

iv. Purchase patterns – average visits per month, amount spent, products purchased, etc.

v. Business costs, for example, rents, inventory, equipment, labor, training, etc.

b. Analysis

i. Build an Excel spreadsheet-based tool encompassing this data and incorporating the relationships uncovered via the research, yielding demand and cost data for each geographic area identified.

NOTE: The spreadsheet would contain an “assumptions” area where the various default factors would be listed, and clearly labeled for the user to modify as necessary.

c. Documentation

i. Develop a Research Report and PPT presentation describing the work. It would include topics such as research methodology, construction of the model, results and an example of the model in use.

ii. User’s Manual – a description of how the model is constructed, how it operates, how to make changes and how they will affect the results.

NOTE: Since it is anticipated that many of the factors (and relationships) on which the model is based will change over time, the model should be constructed in such a way as to make updating easy and simple.

2) Commercialization - The intent of this part of the project is to make the model available via a commercial Software as a Service (Saas) platform, allowing individuals and companies to employ it in the development of financial models for their specific endeavor. (additional details available).

3) Marketing - Develop a professional marketing plan to guide the development and commercial success of the deliverable. (additional details available).