The legalization of cannabis, known as the modern-day gold rush, is growing into a multi-billion dollar industry.
In less than 10 years, the market for marijuana is expected to grow to $24 billion, according to a study from BusinessStudent.com, which provides opportunities for young adults in business-related fields.
Marijuana has long been one of California’s most important cash crops, though it wasn’t legal until recently. Now, tens of thousands of entrepreneurs are rushing to capitalize on the pricey leafy greens.
Before becoming legal in 29 states, California’s marijuana black market was worth $13.5 billion last December, according to cannabis financial analysis firm GreenWave Advisors.
In Tulare County, entrepreneurs and cannabis enthusiasts are weighing the risks of the trade and banking on the green gold. Dispensaries are popping up left and right with two new cannabis shops currently under construction in Woodlake.
Valley Pure and Green Bean Pharm are two cannabis retailers that will sell the product both medically and recreationally.
Michael Dunaway, owner of Green Bean Pharm in Woodlake, said a multi-billion dollar weed industry “may sound incredible,” but it’s the truth.
He compared the potential boon of the present day economy to the economic gains that followed Prohibition.
“It’s a modern-day representation of that,” Dunaway said.
A team from BusinessStudent.com put together a study looking at the future of the cannabis industry.
The study examined the risks and benefits the industry could offer to the communities and business that choose to follow Woodlake and others.
• State tax revenue combined expected to total $2.3 billion by 2020.
• 97 percent of recreational stores and 94 percent of medical stores make a profit or break even.
• Women executives in the industry is 27 percent; 4 percent higher than the national average.
• Denver boasts twice as many cannabis dispensaries as it does Starbucks.
• In 2017, only 368 of 12,000 financial institutions in the U.S. served cannabis businesses.
• On Jan. 4, 2018, Attorney General Jeff Sessions rescinded Obama-era memos that assured cannabis businesses they would not be subject to federal prosecution as long as they followed their state’s laws.
“That Jeff Sessions’ memo certainly provided a little wrench in the gears for us on the financial side of things,” said Dunaway about his. “We have it that all situated now, but that certainly delayed us in starting the project. Things are clarified now and we are moving forward.”
The report suggests opportunities outweigh the risks.
While many people will benefit from the industry — the producer, consumer and supporting industries, Dunaway suggested that anyone interested in joining the industry should know they aren’t going to get rich fast.
“There is money to be made by those who navigate the industry,” he said.
Properly navigating the industry means understanding federal, state and local regulations and requirements. While Marijuana has been legalized in 29 states for recreational and medical use, counties within each state have different rules.
It’s still illegal on a federal level, it’s just a matter of enforcing federal laws at a state level.
One of the seminars at the 2018 World Ag Expo, Cannabis: From Black Market to Mainstream, had several panelists talk about how marijuana is turning into the newest commercial crop.
The seminar introduced the basics of cannabis and how it differs from hemp. It discussed regulations, community benefits and how to become an entrepreneur in the industry.
Being an industry insider is crucial for consumers and retailers, Dunaway said.
“The best thing young entrepreneurs need to do is read the state and local regulations,” he said. “Tons of people, this goes for city and state officials, are just simply misinformed about what the laws say you can and can’t do.”
For Visalia police and sheriff’s deputies their goal is to continue to educate the public on what they can and can’t do, said Visalia Lt. Amy Watkins, who spoke at a recent marijuana-related forum.
Currently, in the county and Visalia, residents 21 and older are allowed to possess, transport and obtain marijuana from a state-licensed retailer, and cultivate up to six plants per household.
People are not allowed to:
• Consume marijuana in any public place
• Smoke or vaporize marijuana in any non-smoking area or within 1,000 feet of a school, daycare or youth center
• Consume marijuana or possess an “open container” of marijuana while driving or riding as a passenger in any motor vehicle, boat, or airplane
• Possess marijuana on school grounds
• Manufacture butane honey oil
• Possess any amount of marijuana if under the age of 21
• Possess more than an ounce
Tulare County currently has a moratorium on marijuana sales within county jurisdiction. Board members have a year to decided what the county will do.
At the forum in January, Tulare County Supervisor Amy Shuklian said, “this is still a health and public safety issue.”