CANNABIS BUSINESS NIGHTMARES - EIGHT WAYS TO DIE

"If you don't take care, you're going to need to be like a cat with 9 lives to survive."

If you want to grow weed as a business, there is a lot you need to know.  Once you've been around the block several times, you'll get to know the well known traps, the open manholes and minefields that are ready to go off in your face at any time. Rather than learn the hard way, we recommend you refer to this sompact business warfare manual, to protect you from your own exuberance and naivety.   So here it is, our  I Told You So list.

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Why Fret over Red Tape - Join the Party - NOT

Red Tape as in RED - A Nazi-like Perversion of the American Way

Where did we go wrong?  What happened to the law?  Back in the day, the elders and leaders were able to create documents like the Bible or Koran, where God's wisdom is summarizes the a rule-set of10 golden oldies.  The precious US Constitution, contains the summary wisdom of thousands of years of European and Middle Eastern learnings to guide a freedom loving population to prosperity.  Today, in our inverted Darwin paradigm, is the place where the stupid get stupider until ripe for promotion, (government- megacorp). 

With that said, there are still a few economic sectors, the new ones, where the playing field is somewhat leve, where smart and gritty entrepreneurs can thrive.  After all, there is a $50 billion dollar (anticipated US marijuana sales) pie to divide up among the players.

We have a Tax Code with about four million words, there are about four new State laws passed in California every day.  That's 800 per year and 8000 per decade.  And old laws usually remain dysfunctionally on the books.  At the end of the day, you look at the real resume of the latest politicians and lawyers that draft up the laws, and you see that they, by in large, seldom have a real resume.  There is no doubt that this goofy bunch of 'law"men and career politicians have, in effect thrown a monkey wrench, sand in the gas, of the machinery that feeds, put clothes and shoes on the feet of the American population.  No matter that this FUBAR movie has played out in Cuba, Venezuela and more than a dozen countries behind the iron curtain, today's "liberals" have no clue, no knowlege of history.  They're drunk on the koolaid....let them go, far far away.

Their experience lies in servicing the various pigs at the trough in Washington and lesser so in the State Governments. There's nothing in the resumes of Obama, Clinton, Bush Jr. et.al to suggest that they are qualified to, or have the right to pen thousands of new restrictions per year.  This regulatory burden has broken the back of middle class America, which is the engine that drives America.  With that said, in the marijuana sector, you will just have to learn to deal with over-regulation and realize that it's going to cost a pretty penny to do it "right".

Unless you are skilled in untangling tons of regulatory tape, you're probably going to fail or at least develop an ulcer while running a business you don't want to wake up to.  Not only are the State laws cumbersome, you're going to have to deal with your community, who can knock you out of business at any time by declaring a moratorium on grow operations or refuse to renew a license for a variety of reasons, some of which have nothing to do with your businesses performance.  At the end of the day, you're going to need someone who is a competent paper bullcrap pusher. And of course, every business needs a good accountant or an honest girl Friday at the barest of minimums.

Internal Fraud - Your Loyal "Friends"

According to Forbes, fraud and theft occur in more than 35 percent of all small businesses.  Worse, the majority of businesses that survive a decade fall victim to major internal fraud. The easiest way to avoid being a victim of fraud is to block or limit access to cash and inventory. Extortion by managers, secretaries and bookkeepers is very common and perpetrated by some average but surprisingly skilled grifters.  Note too, relatives and spouses are police investigator's are always at the top of the initial fraud suspect list along with the people that handle the money.  

"My father taught me many things here — he taught me in this room. He taught me — keep your friends close but your enemies closer."

Major perpetrators are the decent looking professional , your girl next door, the fine church going citizen and especially, the disenchanted partner.  Those are the unwholesome stats.   Other types of fraud include false tips to authorities that your business is breaking some kind of law.  Too many agencies take a guilty until proven guilty approach.  You want to be a good people person and treat everyone well.... and keep a discreet eye on the biz.

The Fed Nightmare Gone?  Wait and See

In the past, the Fed has provided many a life altering experience.  When it came to marijuana, it did not matter whether or not you had broken the law, it didn't matter if you had a proper license and it didn't matter if your operation had been OKayed by the Queen of England.  The goons within the Fed could invade your operation, at gunpoint, and ransack the place, confiscate your stock, place you under arrest and seize your bank accounts.  Check out the invasion of one of the most professional and compliant medical marijuana businesses in the business.

Major Medical Marijuana Dispensary Battles the FEDS - and WINS

Though there are legal remedies at hand, once your marijuana business is shut out at the bank, you're effectively in a fist fight with hands tied behind the back, trying in vain to scrap against a gang.  Hopefully, the Trump administration will respect the State's constitutional right to police its own marijuana turf.  While we're hopeful, no President has ever done anything whatsoever for the American citizens that want marijuana legalization.  Then again, until now America, never had a large majority (63% Gallup) in favor of legalization.  In the past, the DEA said (for what that is worth), they would not invade any operations with 99 plants or less.  

Meanwhile, the supposedly pro-marijuana, Obama administration declared war on the completely non-psychoactive CBD, legislating it as a schedule 1 drug, unavailable for prescription and in the same class as heroin and crack.  So, far we saw it all coming, the diabolical two faced Democrat rhetoric.  While we had Trump scoring near the top as the candidate most likely to be a effective friend of medical marijuana, we have no crystal ball,  Trump has done a lot of things in the past that earned his top score, and he's done a lot of things that makes the cannabis community very nervous.  At the end of the day, it is sit and wait.  If Trump delivers on his promise that the Fed will take their lousy hands off cannabis, then we're "right".  Could Trump win reelection next term by coming through on this issue?

Business Premises

Assuming that you're a reasonable businessman that does not mean that the people nearby are going to be OK.  It's not an I'm OK, you're OK situation.  You are going to have to have a contingency for the busy body, the nitpicker, anal auditors and other characters who can make your life miserable at a minimum and force you out of business at worst.   If you choose a location that are close to a lot of non-commercial activity, your exposure to potential foes increases proportionately.  

It's illegal to be within 1000 feet of a school, park, theatre or residences, at least in theory.  In certain circumstances you might get a pass, but that kind of move is for experts only.  

Having a neat inventory system is a good idea that keeps an up to date list of plants, strains, and status (mature, seedlings) will do you well in surprise inspections.  Your preparation for this nightmare scenario can win over some good but fussy people.

Homeowner Associations

If you happen into a situation where your grow is legal, the community may not accept you as a legit businessman.  In certain communities, you can get the reputation as an undesirable, unsavory character, all the while, you thought, now it's legal, everyone should be OK with it.   Some people in the social agencies could enter the scene and stop your children's friends from visiting your kids (at home).   

If you don't want to enter this nightmare scenario, you can talk with your kids parents discretely, and find out their opinions about "someone" who owns a legal grow operation.  If you are in the vicinity of a homeowners association, you might want to check them out and send a generous donation to the kids fund come Christmas time.  In any event ,that would be a nice thing to do, right?

”As of September 25, Washington authorities conducted 651 premises checks on 252 out of the state’s 668 licensed growers. Of those, six were found to be violating the state’s pesticide laws by using spinosad, a relatively innocuous insecticide." - The Stranger

Disposal Issues - The Nightmare of Over-Regulation

Pollution and toxins in our environment are one of the world's biggest problems, no?  Of course regulation is needed to protect against irresponsible people doing what irresponsible people do.  

But, the people that regulate and enforce environmental issues don't necessarily have the interests of commerce at heart.   Some public officials don't anything functional what so ever about what they are policing, really beyond the paperwork requirement.  An overzealous inspector might be more interested in catching you on a minor offence, rather than assisting your business to thrive and comply reasonably with the laws of the land.  

When it comes to inspections and audit, these people love paperwork, showing that all is in order, and especially that their checklist complete intact, proving that they are compliant with their job description.  Lost in this procedure maybe actual functionality and intent of the audit,  In the world of bureaucracy, a perfectly functional operation may fail with poor documentation, while the inverse is not true   If you use solvents, water, chemicals, you name it, everything must be disposed of and be documented to meet the needs local environmental regulatory standards.  

So under normal circumstances, there is no dumping of even water, it's got to be lab tested or carted away, sometimes as "toxic" waste.  A word of advice, in inspections / audits, you want to be prepared for their check list.  You want to respect their authority and don't talk too much.  But be firm if someone is on a power trip and don't cower to any implications that you are violating the law, that is if you are compliant.  It may be a good idea to hire a suave consultant to handle issues that get hot and heavy.  

Drug Dealer Image

An un-strategically displaced gossip-artist can create a lot of problems.  If your friends, your clothes and car and whatnot chime with the image of a gangster, you've opened the door to scrutiny.  You can get yourself blindsided.  Until you're well established, you girlfriend can't be looking like a hoe on site, you can't be driving a gangsta coup, that is, if you want to reduce the probability of being recruited into the Rocky Picture Horror Show.
 

Startup and Operating Costs Estimate Too Low

If you don't do the math correctly and account for all expenses, and have the cash on hand to cover them, you're going to have to skimp.  Some part of the operation will suffer, and that would be non-essentials.  Things like waste disposal, lab testing, safety won't be compromised.  This leaves you vulnerable to shut-down.  So you will want to cost out the entire operation accurately; grow lights, the right type (LED), ventilation, humidity, temperature control, odor, CO2, testing, soil, nutrients, grow containers are the major items.

Technology, Grey Matter

If you get involved in technologically challenging areas and don't have the brains and organizational skills, then we wish you a pleasant nightmare. Does your team possess the necessary practical experience and brains. It you are not an experienced grower or you have hired the wrong people, your crop yields will be down.  In the beginning stages, this is when most of the problems happen.  Mold?  The facility might be compromised with spores, and other unknowns can come up.  Does the intended genetics of your chosen strains work within your facility? 

Conclusion

These pitfalls, the nightmares that occur, probably with most start-up grow operations. However, with a bit of luck and preparation, you, the capable businessman, stand to make a ton$ in the largest cash crop in American History.

MMJDoctorOnline Notes:  Until 2018, all California and Nevada residents require a medical marijuana recommendation to purchase cannabis legally from dispensaries, cannabis clubs, cooperatives, clinics and other MMJ suppliers.  Our California licensed doctors approve patients applications, 420 evaluations 100 % online using our simple Telehealth process.  It takes only a few minutes to get same day approval.  Patients note, you only pay if our doctor recommends you for cannabis to treat your symptoms and conditions.  Get started here, in minutes you'll be done. We also provide Cannabis ID cards and Growers Permits (up to 99 plants), all same day service, at the most competitive rates.  MMJDoctorOnline complies with the guidelines set by the Medical Board of California for Telehealth Services.
 

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