Marijuana Business Magazine - March 2018

W hile the likelihood of a raid by federal drug enforcers is an open question, cannabis businesses can take steps to keep a low profile and avoid a crackdown. Growers can avoid the temptation to expand their operations. Infused product makers can keep their produc- tion batches small. And retailers, who may have fewer options, can keep their operations lean and mean. Advice for Growers Hezekiah Allen, the executive director of the California Growers Association, recommends that cultiva- tors stay small. “Don’t be greedy,” he said. “A modest-sized small business is unlikely to be a target.” When deciding how much product to keep on hand, it’s important to be aware of the federal laws for possession of cannabis, he added. Marijuana businesses can avoid drawing scrutiny from the feds by keeping inventories and production runs under control KEEPING A LOW PROFILE By Bart Schaneman The New Normal INVENTORY Hezekiah Allen is the executive director of the California Growers Association. “That’s really what we talk about when we talk about federal crackdowns,”Allen said. “We’re talking about federal crimes and federal sentencing. At the end of the day, it’s a five-year mandatory minimum sentence for growing 51 plants. And folks should be hyperaware of that.” Allen doesn’t advise farmers try to break up their operations into several smaller grows. “Having multiple small grows isn’t any better,” he said. “That’s conspiracy.” He re-emphasized keeping a low profile and being a good neighbor. “We have a long history of weather- ing federal crackdowns here in Califor- nia, so it’s really nothing new, from our perspective,” Allen said. Advice for Infused Product Makers Julie Dooley, president of Julie’s Natural Edibles in Denver, said small batches is one way that her company has always kept a low-key profile. While her business has produced small batches mostly for freshness rea- sons, it also works for raids, she said. In the event of a visit from the Drug Enforcement Agency, for example, Dooley’s entire product inventory could be seized. Having a little amount on hand would reduce the financial blow. Like Allen, she recommends keeping your head down. “I wouldn’t be doing an all-out blitz on marketing,” Dooley said. In the meantime, she’s chugging along with her business while minding her P’s and Q’s. “Keeping your books in order is really important,” Dooley added. “I’ve never been raided, so far. Even though it doesn’t make any sense, and it shouldn’t happen, it doesn’t mean it can’t.” Advice for Retailers Kc Franks, the owner of two Lux Pot Shop cannabis retail stores in Seattle, said “there’s really not going to be too much change” in how he adjusts product inventory at his shops. Because the Washington state market isn’t vertically integrated, he purchases his product from a range of producers and processors. As a result, Franks is competing for market share among both customers and vendors. “As a retailer I have to manage my relationships with producers and proces- sors,” Franks said. “If I’m not purchasing product from them, then they’re going to go find people to sell product to.Then, when I need to purchase more product, they may not be available to me.” Julie Dooley is president of Julie’s Natural Edibles in Denver. March 2018 • Marijuana Business Magazine • 61