The cannabis market in the United States has seen exponential growth in recent years, driven by demand for alternative products for wellness and stress relief. Although cannabis remains a controversial issue, especially in Latin America, in the U.S., this market represents an attractive opportunity for investors. In this article, we’ll explore three franchises within the cannabis industry: CBD American Shaman, Sunmed, and Natural Life.
We’ll walk you through its features, benefits, challenges, and aspects to consider before investing. In addition, if you are looking for investment opportunities that also allow you to immigrate to the United States, these franchises could be an excellent option to apply for the E-2 investor visa.
The Growing Market for Cannabis Products
Have you noticed how CBD and cannabis product stores seem to be on every street corner in America? This is not a coincidence. Interest in cannabis-derived products has grown significantly due to their purported wellness benefits. From sleep gummies to anti-stress creams, the options are endless. However, as an investor, it is vital to understand both the risks and opportunities in this sector. Franchising in this sector can be a tempting option, but not all of them are created equal. Get up close and personal with the three most popular cannabis franchises in the United States:
CBD American Shaman Franchise
The first CBD franchise we looked at is CBD American Shaman, one of the most recognizable brands in this market. Specializing in CBD products such as oils, gummies, creams, and even smoking herbs, this franchise has strong branding and an attractive digital presence.
Typical locations of this franchise have an average size of 900 to 1000 square feet (90-140 square meters) and usually have between 3 to 4 employees.
Currently, CBD American Shaman is facing three lawsuits and has not registered bankruptcies.
One of the most problematic aspects is that franchising forces its franchisees to buy exclusively its products, without allowing them to opt for other suppliers. In addition, many stores have closed in recent years, with 130 closures between 2021 and 2023 (54 stores in 2021, 35 in 2022, and 41 in 2023). This is a worrying sign about the franchise’s performance.
Despite its strength in some respects, the drop in the number of stores and the lack of clear financial figures can be a red flag if you’re looking for long-term stability.
Sunmed Franchise
Sunmed is another franchise dedicated to alternative CBD and cannabinoid products, similar to those of CBD American Shaman. They offer a wide range of products aimed at improving health and well-being through the use of CBD.
The Sunmed franchise follows a store model similar to that of CBD American Shaman, with small or medium-sized stores and few employees.
The brand has five lawsuits and has not registered bankruptcies.
An advantage of this franchise is that, unlike CBD American Shaman, it has shown positive net growth, having opened more stores than it has closed in the last three years. In 2021 they opened 107 stores, in 2022 they opened 29, and in 2023 they closed 19. However, recent closures indicate that uncertainty in the cannabis industry could be affecting its performance.
Sunmed also does not provide financial data in its Franchise Disclosure Document, which can also be inconvenient for investors.
Although Sunmed is showing positive signs, it is important to be aware of the market volatility and the constant legal changes affecting the cannabis industry in the United States. Are you ready to face these challenges? Let’s move on to the last CBD franchise that we will discuss in this article.
Natural Life Franchise
Natural Life is the only one of these franchises that sells cannabis (marijuana) in states where its sale is legal. In addition to CBD products, they offer a variety of cannabis-derived products, such as Delta-8 and Delta-9, which have similar effects to marijuana, but are legal in certain US states.
Like the other franchises, Natural Life operates in small to medium-sized locations, with few employees.
What sets Natural Life apart is that it allows franchisees to choose from over 30 suppliers and over 100 products, and they even have the option to add their own products. This flexibility is a plus point compared to other franchises such as CBD American Shaman, which forces franchisees to exclusively sell their products.
In terms of transparency, Natural Life is the only one of the three franchises to provide financial figures. The annual sales range from $31,000 (the lowest-selling store) to $685,000 (the top-selling store), with a national average of $428,000 in gross sales per store. Although these are not extraordinary figures, they represent a reasonable performance for this type of business.
A positive aspect of Natural Life is that it allows franchisees to be not tied to specific products and to open multiple units to improve profitability. It is a good option for those who want to diversify and expand their operations in the cannabis market.
This franchise, although small, shows greater transparency and offers an interesting opportunity if you are looking to invest in an emerging market with growth potential.
*Data as of the date of publication of this article
*Values expressed in US dollars
Find out which CBD franchise is best for you
Investing in a CBD or cannabis franchise can be an excellent opportunity for those looking to enter a growing market, but thorough research is essential. While CBD American Shaman has a strong brand, its recent closures and supplier restrictions raise questions. Sunmed offers positive net growth, but with uncertainties as to the stability of the industry. Natural Life, on the other hand, stands out for its flexibility and financial transparency, which makes it an interesting option for those looking to diversify their investment.
Now the question is: which of these options best suits your financial and personal goals? Let’s find out.
If you’re interested in learning more about these or other franchise opportunities in the United States, don’t hesitate to schedule a free consultation with us at Interlink FBC!
