Jacob Redmond
Well-Known Member
It turns out selling weed is pretty hard. Contrary to popular belief, selling it legally, at least, isn’t all THC-infused lollipops and rainbows. Just ask David Schwartz.
The six-year cannabis-industry veteran came to Colorado in the '90s from Long Island, New York, after discovering Boulder on his way to a Rainbow gathering in Wyoming. For him, selling marijuana in a locale known around the nation for its liberalized pot laws is not just about counting money; it’s about taxes, regulatory compliance, inventory management, and above all, staying on the right side of Colorado’s “pot cops” - the Marijuana Enforcement Division (MED).
“Every single aspect of the industry requires a fair amount of consciousness and due diligence,” says Scwhartz. “Your daily sales have to be loaded into MED at the end of the night, all your weights have to be accurate, you have to account for anything that dries up or goes missing. Every day you’ve got to do an accounting of what’s in your inventory.”
Schwartz’s midsize marijuana dispensary, Herban Medicinals, is dotted with encased magazine clips showcasing reviews of the shop’s most popular marijuana strains – names like Sour Grape, Swiss Bliss and Fractal Kitty. The interior would be largely unremarkable if not for the 50 or so marijuana plants growing in a room behind four glass windows that occupy about a quarter of the business.
Schwartz often works out front behind a window where he checks patrons’ IDs before buzzing them into the dispensary. He says when he first got started there were sweeping rules changes on an almost weekly basis, but those have slowed to a more manageable pace as the industry has matured. Another thing that has changed are the attitudes of the customers.
“It’s people coming in and expecting the world and not knowing how much goes into [the business],” he says. “Or [wanting] free this or discounted that, just for showing up. There’s a certain level of expectation or entitlement on the buyer’s end.”
On this afternoon, Schwartz is leaving a voicemail for Brandy who he hopes – really, really hopes – has ensured the quarterly sales tax has been paid. After Brandy, it’s a procession of calls with business associates about potential partnerships and interested buyers. Along with a bevy of other problems, there’s also the question of how to prop up a less-successful wing of his business.
It’s the typical life of a small-business owner. But in addition to the gamut of challenges that face most of the intrepid souls who venture into business for themselves, pot-repreneurs like Schwartz are also confronting a mountain of challenges and limitations exclusive to their industry.
“There’s definitely a lot of hoops to jump through,” says Schwartz. “There’s, like, 200 pages of laws and rules. I can’t really iterate it all. There’s a monthly update and compliance officers; you’re expected to be caught up on anything that’s been laid out as law up until a certain time and then from that time forward they’re basically updating, monthly, the changes that are happening in the industry.”
For marijuana business owners, there are also zoning regulations that keep them 1,000 feet from a school, church or another dispensary; packaging regulations that dictate the exact specifications of the containers in which they can sell their product; a compliance board that mandates tracking for every item sold; state-sanctioned training for all upper-level employees; dueling regulations for medicinal and recreational sales; and a tax code that doesn’t offer the same rewards – such as exemptions for reinvestment of revenue back into the business – as most other small businesses. It’s also virtually impossible to get loans. Since selling marijuana is still a federal offense, almost no bank is willing to work with the industry.
And then there’s another unique problem: the competing black market dealers who have none of the costs of operating a lawful business and often access to product of similar quality. Marijuana advocates long-suggested that legalization would be the key to wiping out the black market for marijuana, but almost a year and a half into the experiment, that hasn’t been the case.
About five miles from Herban, smoke is in the air and a dealer armed with three small baggies of Sour Diesel marijuana is doing business the old-fashioned way. The dealer spoke with International Business Times on the condition of anonymity, in part to avoid possible arrest, but primarily because he fears backlash from people in the legal industry with whom he once worked.
He used to sell marijuana legally, he says. He owned a business that operated out of a modest building in Denver, but he grew disillusioned following what he saw as excessive regulation, uncertainty and taxation. College educated and previously struggling to keep up with the city's rapidly rising rent prices, he says he now operates his marijuana business much the same way he did in high school: out of his car.
The state’s Amendment 64 ushered in a new era of business last year, allowing for marijuana to be sold for recreational as well as medicinal use. That brought a wave of new customers to pot dispensaries and a flood of cash, but it came with a cadre of regulations governing just about every aspect of who, what, when, where and how marijuana could be sold.
Skirting these regulations and free of overhead costs, sales tax and MED regulations, this dealer estimates he’s making two to three times as much money as when he owned his marijuana business. And his clandestine delivery service is just a tiny part of the equation when it comes to the state’s black market.
In March, Colorado authorities announced the arrest of Tri Trong Nguyen, his wife and 30 others in a bust of the largest marijuana-trafficking ring since legalization was passed. Authorities had seized 4,600 pounds of marijuana, nearly 2,000 marijuana plants, 10 pounds of hash oil and about $1.4 million in cash by the time the bust was made public.
"This investigation shut down one of the largest and most sophisticated criminal enterprises uncovered since Colorado voters passed Amendment 20 in 2000," Colorado Attorney General Cynthia H. Coffman said at a press conference following the bust. "Nguyen's drug ring is further evidence of Colorado's thriving black market. Illegal drug dealers are simply hiding in plain sight, attempting to use the legalized market as a cover."
It’s a cover that has been easily and profitably exploited because legalization has given shelter to a number of black-market dealers who no longer need to hide what they’re doing. With so many people now allowed to grow marijuana legally, selling it illegally is now easier than ever.
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: Colorado Marijuana Legalization 2015: Fighting The Black Market And The Everyday Challenges Of Selling Legal Weed
Author: Dion Rabouin
Contact: Contact Form
Photo Credit: Dion Rabouin
Website: International Business Times - International Business News, Financial News, Market News, Politics, Forex, Commodities
The six-year cannabis-industry veteran came to Colorado in the '90s from Long Island, New York, after discovering Boulder on his way to a Rainbow gathering in Wyoming. For him, selling marijuana in a locale known around the nation for its liberalized pot laws is not just about counting money; it’s about taxes, regulatory compliance, inventory management, and above all, staying on the right side of Colorado’s “pot cops” - the Marijuana Enforcement Division (MED).
“Every single aspect of the industry requires a fair amount of consciousness and due diligence,” says Scwhartz. “Your daily sales have to be loaded into MED at the end of the night, all your weights have to be accurate, you have to account for anything that dries up or goes missing. Every day you’ve got to do an accounting of what’s in your inventory.”
Schwartz’s midsize marijuana dispensary, Herban Medicinals, is dotted with encased magazine clips showcasing reviews of the shop’s most popular marijuana strains – names like Sour Grape, Swiss Bliss and Fractal Kitty. The interior would be largely unremarkable if not for the 50 or so marijuana plants growing in a room behind four glass windows that occupy about a quarter of the business.
Schwartz often works out front behind a window where he checks patrons’ IDs before buzzing them into the dispensary. He says when he first got started there were sweeping rules changes on an almost weekly basis, but those have slowed to a more manageable pace as the industry has matured. Another thing that has changed are the attitudes of the customers.
“It’s people coming in and expecting the world and not knowing how much goes into [the business],” he says. “Or [wanting] free this or discounted that, just for showing up. There’s a certain level of expectation or entitlement on the buyer’s end.”
On this afternoon, Schwartz is leaving a voicemail for Brandy who he hopes – really, really hopes – has ensured the quarterly sales tax has been paid. After Brandy, it’s a procession of calls with business associates about potential partnerships and interested buyers. Along with a bevy of other problems, there’s also the question of how to prop up a less-successful wing of his business.
It’s the typical life of a small-business owner. But in addition to the gamut of challenges that face most of the intrepid souls who venture into business for themselves, pot-repreneurs like Schwartz are also confronting a mountain of challenges and limitations exclusive to their industry.
“There’s definitely a lot of hoops to jump through,” says Schwartz. “There’s, like, 200 pages of laws and rules. I can’t really iterate it all. There’s a monthly update and compliance officers; you’re expected to be caught up on anything that’s been laid out as law up until a certain time and then from that time forward they’re basically updating, monthly, the changes that are happening in the industry.”
For marijuana business owners, there are also zoning regulations that keep them 1,000 feet from a school, church or another dispensary; packaging regulations that dictate the exact specifications of the containers in which they can sell their product; a compliance board that mandates tracking for every item sold; state-sanctioned training for all upper-level employees; dueling regulations for medicinal and recreational sales; and a tax code that doesn’t offer the same rewards – such as exemptions for reinvestment of revenue back into the business – as most other small businesses. It’s also virtually impossible to get loans. Since selling marijuana is still a federal offense, almost no bank is willing to work with the industry.
And then there’s another unique problem: the competing black market dealers who have none of the costs of operating a lawful business and often access to product of similar quality. Marijuana advocates long-suggested that legalization would be the key to wiping out the black market for marijuana, but almost a year and a half into the experiment, that hasn’t been the case.
About five miles from Herban, smoke is in the air and a dealer armed with three small baggies of Sour Diesel marijuana is doing business the old-fashioned way. The dealer spoke with International Business Times on the condition of anonymity, in part to avoid possible arrest, but primarily because he fears backlash from people in the legal industry with whom he once worked.
He used to sell marijuana legally, he says. He owned a business that operated out of a modest building in Denver, but he grew disillusioned following what he saw as excessive regulation, uncertainty and taxation. College educated and previously struggling to keep up with the city's rapidly rising rent prices, he says he now operates his marijuana business much the same way he did in high school: out of his car.
The state’s Amendment 64 ushered in a new era of business last year, allowing for marijuana to be sold for recreational as well as medicinal use. That brought a wave of new customers to pot dispensaries and a flood of cash, but it came with a cadre of regulations governing just about every aspect of who, what, when, where and how marijuana could be sold.
Skirting these regulations and free of overhead costs, sales tax and MED regulations, this dealer estimates he’s making two to three times as much money as when he owned his marijuana business. And his clandestine delivery service is just a tiny part of the equation when it comes to the state’s black market.
In March, Colorado authorities announced the arrest of Tri Trong Nguyen, his wife and 30 others in a bust of the largest marijuana-trafficking ring since legalization was passed. Authorities had seized 4,600 pounds of marijuana, nearly 2,000 marijuana plants, 10 pounds of hash oil and about $1.4 million in cash by the time the bust was made public.
"This investigation shut down one of the largest and most sophisticated criminal enterprises uncovered since Colorado voters passed Amendment 20 in 2000," Colorado Attorney General Cynthia H. Coffman said at a press conference following the bust. "Nguyen's drug ring is further evidence of Colorado's thriving black market. Illegal drug dealers are simply hiding in plain sight, attempting to use the legalized market as a cover."
It’s a cover that has been easily and profitably exploited because legalization has given shelter to a number of black-market dealers who no longer need to hide what they’re doing. With so many people now allowed to grow marijuana legally, selling it illegally is now easier than ever.
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: Colorado Marijuana Legalization 2015: Fighting The Black Market And The Everyday Challenges Of Selling Legal Weed
Author: Dion Rabouin
Contact: Contact Form
Photo Credit: Dion Rabouin
Website: International Business Times - International Business News, Financial News, Market News, Politics, Forex, Commodities
