The Feasibility Study for Investment of The Restaurant Business of Cannabis Food and Drink

Abstract

This research article aimed to study the feasibilities of investing in cannabis-containing food and beverage businesses in both finance and marketing. This study uses secondary and primary data from in-depth interviews with 3 businesses. The financial feasibility study shows that the businesses are not worth the investment. The net present value is equal to - 15,252.82 baht, the benefit-cost ratio is 0.9994, the internal rate of return is 8.4143 percent, and the payback period is 8 years and 3 months. They do not pass the investment decision criteria because the slower growth rate of returns compared to the initial investment is at a relatively high level. The costs of sales and expenses are adjusted to increase by 5% to 7% per year, while the return on investment from sales only increases by 5% per year. Therefore, the return on investment does not correspond to the costs incurred each year. The businesses cannot withstand the impact of increased risks and uncertainties such as inflation in the economy, cost of raw materials in production and return. Furthermore, the marketing feasibility study shows that the businesses are not attractive to invest in because these restaurant businesses still have many factors that slow down business growth. Moreover, consumer demand steadily decreases. There are relatively few promotional or marketing strategies available to attract consumers and the businesses lack sufficient government support. Although the businesses have strengths and opportunities that can be enhanced through different strategies, including exchanging knowledge with other entrepreneurs to develop more different or increasing public relations and advertising channels, the businesses are still unable to fully and effectively avoid obstacles and resolve various weaknesses. Therefore, the possibility of investing in cannabis-containing food and beverage businesses, in terms of finance and marketing, is not very attractive.