Fifteen states now allow regulated amounts marijuana for adult recreational use and three more may follow in 2021. But the business of retailing weed remains an unconventional enterprise fraught with risk.
It still is illegal under federal law to sell or possess marijuana. The U.S. House of Representatives recently voted to decriminalize the drug, but the legislation’s fate remains uncertain in the Senate. This leaves cannabis entrepreneurs scrambling for banking services while financial-services companies weigh the risks involved.
More cash and curbside pickup
Cannabis accounts for $10 billion in sales in the United States. It is projected to grow to $30 billion by 2025. Since the pandemic started in March, dispensaries in Oregon increased sales 25-30% compared to 2019, according to the Oregon Liquor Control Commission, which regulates pot shops. In September, regulators approved permanent rules allowing marijuana retailers to sell curbside up to 8 ounces daily and 32 ounces per month.
Lobbying is intensifying to destigmatize the product and modernize the banking industry to accommodate entrepreneurs. Dispensaries remain a mostly cash business with customers unable to use debit cards and vendors unable to process credit accounts.
That leaves owners in the precarious position of stuffing bills into pipes or burying them before they can deposit profits. Some have even driven duffel bags of cash to Salem to pay their taxes. Simply opening a checking account or securing a loan can be a challenge.
Growing and staying nimble
Oregon legalized recreational use in 2014, with growing operations and outlets exponentially expanding. It remains a tightly regulated industry with a shifting landscape that requires thriving businesses to adapt.
Knowing what you can do, cannot do and should do can be a daunting task for any business owner, let alone someone on the cutting edge of capitalism. Going it alone could leave you vulnerable to licensing, lending and leasing issues. Let someone experienced in business and cannabis law guide you through the process of starting and managing an exciting new venture so it does not go up in smoke.