Jacob Redmond
Well-Known Member
The cannabis industry has come a long way. Four states and the District of Columbia have legalized marijuana, and voters in up to five more states might do the same next year. Plenty of businesses have launched to successfully sell (and legally, I might add) cannabis and extracts.
Bolder Cannabis and Extracts, the company that my partner Spencer Uniss and I co-founded in 2009, started out small. With $20,000 in our bank account, we were providing legal medical marijuana as caregivers in Colorado. We had six lights and a 1,000-square-foot grow space. Today, we've expanded to 700 lights across 18,000 square feet and are a multi-million-dollar company. We've even consulted states and other entities on issues surrounding legalization.
The reason I bring up our success is not to brag but to illustrate an important point about how we accomplished our success: we didn't cut corners. And that's important in a risk-averse industry where many companies take shortcuts – and usually fail.
If you are a new cannabis company, you will need to invest money to be legal in a high liability business. It's like any other business when it comes to the basics. From paying employees a fair wage and taxes, to investing in security and tracking systems, to training employees and doing product audits, we operate and act like a legitimate company – because we are.
And it starts with compliance.
By being compliant, we can help set the bar on how cannabis companies are run on a national scale, while building our own groundwork to become a national brand. Being compliant also means we actually want more regulation so the cannabis industry will be legal and we can all operate with the same rules as the rest of businesses across the United States. This will level the playing field and make the marijuana industry more legitimate.
Being compliant has its challenges. There are numerous compliance procedures and policies in place across different states, and even different cities and counties within states. These procedures – like no other industry – can be complicated for new business owners.
For instance, as our business evolved, so too did the rules and guidelines that governed us (most notably with the passage of Colorado's groundbreaking legalization of recreational cannabis in January 2014). By being compliant we were able to stay one step ahead of where the industry was going and successfully segue into recreational sales from medical sales. We discovered that recreational sales were stricter with more procedures. The infrastructure was heavier and the sales and excise taxes higher. Though, where medical growers need patient cards and counts assigned on file, recreational growers pay for a license to grow plants. It's a tradeoff, and currently we're offering more recreational than medical plants.
To stay compliant with local laws, Bolder Cannabis and Extracts developed very specific checks and balances to stay the course.
Usually mandated by each state, cannabis companies are required to keep track of inventory, returns, and costs for regulation. This process not only helps us get a sense of what product is being sold, it leads to a path of more regulations that will result in fewer illegal sales.
Technology is an important component to help us maintain our inventory. Systems we have in place are crucial to help us track the entire grow cycle right until the moment when final product is sold to a customer. Our inventory software also ensures our product isn't being diverted to the black market or to underage buyers. RFID tags embedded into the software allow companies like ours to input data and scan everything in one grow facility and not individual plants, saving us a tremendous amount of time.
Theft is a huge issue with many cannabis companies, especially with so much cash on hand. To prevent theft of profits and product, we employ cameras to monitor our operation. Cameras, motion sensors, and off-site recordings are important to our business and to the industry. Like cameras at a casino, the cameras we use can help keep an eye on intruders stealing from the company. It works: We've caught two separate burglars by watching archived video.
Being compliant isn't cheap, but it's worth the costs. You can expect to spend anywhere from $80,000 up on a decent security system – it depends on the size of your grow area. Tracking your product via RFID tags can cost in the range of 50 cents per tag. Again, the more product, the more tags, the more costs.
There is no concrete price tag and costs can vary wildly. For example, when my partner and I consult with marijuana companies looking to go legit and compliant, we can charge upwards of $100,000 plus. But, that price also varies depending on what the client's needs are and how large their grow facilities are – the more space, the more time for logistics.
From the beginning we have played the long game and aren't just building a company, but an industry. We know that offering the best product possible is important to success, and being the best also includes being compliant. Don't skimp on compliance – or costs. Simply put, don't bend the rules or cut corners in order to get product sold faster or make money quicker without following compliance rules. It's not worth it and ultimately you'll be more successful for it.
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: Building the marijuana market: Why companies in the cannabis industry need to ensure compliance to be successful
Author: Adam Weiss
Contact: Contact Us - The Business Journals
Photo Credit: The Associated Press
Website: Startups, Entrepreneurs and Innovation - Upstart Business Journal
Bolder Cannabis and Extracts, the company that my partner Spencer Uniss and I co-founded in 2009, started out small. With $20,000 in our bank account, we were providing legal medical marijuana as caregivers in Colorado. We had six lights and a 1,000-square-foot grow space. Today, we've expanded to 700 lights across 18,000 square feet and are a multi-million-dollar company. We've even consulted states and other entities on issues surrounding legalization.
The reason I bring up our success is not to brag but to illustrate an important point about how we accomplished our success: we didn't cut corners. And that's important in a risk-averse industry where many companies take shortcuts – and usually fail.
If you are a new cannabis company, you will need to invest money to be legal in a high liability business. It's like any other business when it comes to the basics. From paying employees a fair wage and taxes, to investing in security and tracking systems, to training employees and doing product audits, we operate and act like a legitimate company – because we are.
And it starts with compliance.
By being compliant, we can help set the bar on how cannabis companies are run on a national scale, while building our own groundwork to become a national brand. Being compliant also means we actually want more regulation so the cannabis industry will be legal and we can all operate with the same rules as the rest of businesses across the United States. This will level the playing field and make the marijuana industry more legitimate.
Being compliant has its challenges. There are numerous compliance procedures and policies in place across different states, and even different cities and counties within states. These procedures – like no other industry – can be complicated for new business owners.
For instance, as our business evolved, so too did the rules and guidelines that governed us (most notably with the passage of Colorado's groundbreaking legalization of recreational cannabis in January 2014). By being compliant we were able to stay one step ahead of where the industry was going and successfully segue into recreational sales from medical sales. We discovered that recreational sales were stricter with more procedures. The infrastructure was heavier and the sales and excise taxes higher. Though, where medical growers need patient cards and counts assigned on file, recreational growers pay for a license to grow plants. It's a tradeoff, and currently we're offering more recreational than medical plants.
To stay compliant with local laws, Bolder Cannabis and Extracts developed very specific checks and balances to stay the course.
Usually mandated by each state, cannabis companies are required to keep track of inventory, returns, and costs for regulation. This process not only helps us get a sense of what product is being sold, it leads to a path of more regulations that will result in fewer illegal sales.
Technology is an important component to help us maintain our inventory. Systems we have in place are crucial to help us track the entire grow cycle right until the moment when final product is sold to a customer. Our inventory software also ensures our product isn't being diverted to the black market or to underage buyers. RFID tags embedded into the software allow companies like ours to input data and scan everything in one grow facility and not individual plants, saving us a tremendous amount of time.
Theft is a huge issue with many cannabis companies, especially with so much cash on hand. To prevent theft of profits and product, we employ cameras to monitor our operation. Cameras, motion sensors, and off-site recordings are important to our business and to the industry. Like cameras at a casino, the cameras we use can help keep an eye on intruders stealing from the company. It works: We've caught two separate burglars by watching archived video.
Being compliant isn't cheap, but it's worth the costs. You can expect to spend anywhere from $80,000 up on a decent security system – it depends on the size of your grow area. Tracking your product via RFID tags can cost in the range of 50 cents per tag. Again, the more product, the more tags, the more costs.
There is no concrete price tag and costs can vary wildly. For example, when my partner and I consult with marijuana companies looking to go legit and compliant, we can charge upwards of $100,000 plus. But, that price also varies depending on what the client's needs are and how large their grow facilities are – the more space, the more time for logistics.
From the beginning we have played the long game and aren't just building a company, but an industry. We know that offering the best product possible is important to success, and being the best also includes being compliant. Don't skimp on compliance – or costs. Simply put, don't bend the rules or cut corners in order to get product sold faster or make money quicker without following compliance rules. It's not worth it and ultimately you'll be more successful for it.
News Moderator: Jacob Redmond 420 MAGAZINE ®
Full Article: Building the marijuana market: Why companies in the cannabis industry need to ensure compliance to be successful
Author: Adam Weiss
Contact: Contact Us - The Business Journals
Photo Credit: The Associated Press
Website: Startups, Entrepreneurs and Innovation - Upstart Business Journal
