Welcome to WEEK SIX of the 10 week Marijuana Business Training Course!
This week’s course will cover: STOREFRONT OPERATIONS
Store layout is actually filed with more considerations than you might initially imagine. It has been said that the store front should have the functionality of a bank with a feel of a wellness center – remember that is your primary directive. The employment of a security guard is a subject of much debate considering the negative impact this presence can have on the feeling of a medical center, but alternately it would be an unfortunate circumstance to need one and be without one. This will ultimately be your decision, and the selected location of your facility will likely have a big impact on this. Cameras, alarm systems and electronic doors are three elements that can go a long way to not requiring a security guard on the premises.
Cameras should be strategically placed throughout the collective, and you can get an 8-10 camera system for around $500. The most common backup system keeps video for the duration of a week, and records over previous content on a cyclical routine. Audio is another point for debate, and many feel it is better to err on the side of caution. Like any good measure, you will want to monitor and test your system on a regular basis, because finding out after a problem has occurred that your cameras were not functioning is not a scenario you want to find yourself in. Furthermore, backing up your video and audio in an offsite location further reduces liabilities. It is also your call if you want employee only areas to be monitored. It is likely in your best interest, but it is best to have full transparency with your employees if you choose to employ this measure.
An alarm system should be operating on a 24 hour clock to detect break-ins whether staff are present or not. A combination of glass breakage sensors and motion detectors should be sufficient, and obviously motion sensors are meant for hours outside of normal operation times. In addition, an electronic door will allow employees to buzz patients into certain areas of the facility once their identification has been verified. Even behind secured areas, it is often common practice to still have patients separated from employees or certain areas where large amounts of medicine are kept to reduce temptation or potential for certain problems.
The use of a waiting room goes a long way in providing areas that do not feel as highly secured to ensure the wellness center atmosphere is maintained. Especially as patients will have times when they need to fill out paperwork and conduct business outside of medicine transactions. In addition, this area will serve as a positive first impression for people as they enter the collective. Educational materials and comfortable sears should also be available in this area. Restrooms are often made available to patients as some of them cannot go too long without bathroom trips due to their ailments, and obviously will be necessary for employees. Restriction of access to restrooms is best to avoid public use, as there are certain unwanted liabilities that could arise from providing these facilities.
Beyond the basics, there are some other things you can make sure you have covered to guarantee the ambiance of a Wellness Center. Cleanliness may seem obvious, but it cannot be overlooked. Hospitals are notoriously sterile environments, and Wellness Centers should imitate this feeling. However, medical Marijuana is a holistic healing practice so elements that soften the coldness of sterile environments are an important balance to strive for. Incorporating certain aspects into the design of the space to account for the function and feel can go a long way. You want to maximize the experience patients have by creating a flow in the process through the layout of the space. Getting hung up on little things can sometimes lead to unnecessarily awkward situations for some patients, and the goal is to facilitate their experience and make them feel comfortable and confident with their choice to use a healing alternative that might seem scary at first. To this end, you want to create a memorable and positive experience for them. One that will make them want to tell their friends about the positive experience they had. Little things like using colors that you would expect in a yoga studio or even a jewlrey store can go a long way. Also, glass cases lined with black backdrops can really make the product pop, and appear to be as special as it actually is. It is a beautiful plant, a piece of artwork from Mother Nature, and displaying it as such will help patients honor this value. Also, there is not a lot of need for an excess of space in the facility, and this can help keep costs of real estate rental down as well as create an intimate and comfortable experience for both your patients and your employees. Make sure you leave enough room to facilitate the movement of people who are in pain or in a wheelchair.
Simple setup techniques can also improve the experience of patients making selections and learning about different products and alternate types of medication ingestion methods. Having cases stocked with a small amount of product for each strain can reduce an overwhelming feeling, and keeping back stock in the areas below the glass cases can make it easy for your employees to keep product in the cases. With display cases between the employees and patients, the use of vertical glass door shelving units behind employees to display vaporizers and other instruments can facilitate education and discussion while medicine is being packaged. This will encourage education in patients, and create opportunities for discussion. This is not to say that you don’t want to pay attention to how you merchandise your product, because this is very important. To the point, how you display your wares is how you present your business to your patients. Aldi may save time and money by displaying good in the shipping boxes, but for specialty wares it is worth the extra effort to put things nicely on display. This is also an opportunity to encourage education. For example, edibles can have information not only on the strain, but also on the ingredients of the food.
A note on tact: sure sex sells, and sex is often sold alongside medical Marijuana and is commonplace on many Marijuana sites. If you want to maintain a higher ground of Wellness Center, then shoot more for the yogic experience than the tacky experience. You’ll find there are advantages to maintaining this “higher level” of experience for your customers. This too plays into the layout again. Your patients might often be in a wheelchair or have some other challenge to getting around, and if they are ill then they are looking for a soothing and non-abrasive experience. You want to be a legitimate business owner, run your dispensary like one.
Membership application and verification is a given for setting up members of the collective and buyers of the cooperative, as it is for establishing providers and caregivers. The main purpose of creating filed records on members. The application process should include a copy of the valid state medical Marijuana identification card, contacting the recommended physician and verification of his/her credentials. Copies should be made of all available documentation. Finally, include a signature page for the member to agree not to distribute the Marijuana and take it for any use other than medicinal purposes. Track when member cards expire, and mandate currency, and keep all records for every transaction. Distribution and sales to non-members is prohibited.
Display cases are common, and essentials like packaging and payment processing are a given. Computers and printers, and a basic computer system should all be anticipated.
Getting off the ground floor of this movement will ensure that you are among the pioneers of medical Marijuana. You stand to make an excellent profit establishing your business as the standard before major corporations take over the field and try to lure consumers into patronizing the “Walmart of Weed.” With your participation in the emerging industry, you can ensure the cultivation of medical Marijuana remains safe, organic add profitable, while ensuring the quality of products maintains integrity for users and patients in need.”
The “Cash Only” problem
If you remember reading in week one we mentioned the challenges of processing payments due to banks not offering credit services to dispensary owners. Hopefully, legislation will progress to address this issue, but in the meantime, you will need to have lock boxes and safes in your facility to deal with all of the cash you will be taking in. Also you will have to consider your employees safety when transferring funds to the bank, and sending them on frequent trips with smaller amounts of cash is an easy first step.
The thieves came at night, taking $1,000 in edible pot and leaving $6,000 in damages.
“In 2009, the Denver Police Department estimated that about 17 percent of marijuana retail shops had been robbed or burglarized in the last year. That was good news: a bit less than liquor stores (20 percent) and banks (34 percent), and on par with pharmacies. Today, however, a darker picture has emerged. There are about 325 marijuana companies in Denver, based on an analysis of licensing data done for NBC News by Marijuana Business Daily, a leading trade publication. (Most companies hold numerous licenses.) At the same time, there have been about 317 burglaries and seven robberies reported by these companies in the last two years, according to police data. That’s an annual robbery and burglary rate of about 50 percent, more than double what it was in 2009. Obama administration has sent a message to the nation’s bankers: Even though the sale of marijuana is a federal crime, they can provide service to this new industry without fear of prosecution, but only if the bankers follow a detailed list of guidelines. But the nation’s bankers don’t see it that way. They say the guidance from the Department of Justice and the Department of Treasury doesn’t change the fact that possession or distribution of marijuana violates federal law, and any bank that supports those illegal activities could be prosecuted or sanctioned. Steve Hudak, spokesman for the Financial Crimes Enforcement Network at the Treasury, told CNBC that in preparing its guidance, the agency learned that there are financial institutions interested in accepting this business. We tried to make it clear that financial institutions can offer services to these businesses and still comply with their obligations under the Bank Secrecy Act. most of its members still feel it’s too risky to take the plunge. Another stumbling block: The new guidelines require a lot of paperwork and due diligence to satisfy federal regulators and prosecutors. It’s very compliance intensive and risky if the bank misses something. For example, the Justice Department would expect a bank to make sure any marijuana business with an account did not sell pot to minors, is not involved in illegal activities and that the cash flow of that business is what would be reasonably expected. Besides the monitoring, the bank would have to file suspicious activity reports with the federal government whenever there was a cash transaction of $10,000 or more. Customers must pay in cash—no checks, no credit cards and no debit cards. The cannabis industry in the U.S. is a cash-only business, with all the problems that creates. A busy pot shop in Denver can handle about $25,000 a day. “It’s crazy,” said Brian Ruden, who owns Starbuds in Denver and runs his business on cash and money orders. It’s not only “extremely inconvenient,” but it creates a security nightmare.” Reps. Denny Heck, D-Wash., and Ed Perlmutter, D-Colo., have introduced a bill that would do just that. The Marijuana Business Access to Banking Act would prohibit any federal banking regulator from “prohibiting, penalizing or otherwise discouraging a depository institution from providing financial services to a marijuana-related legitimate business.”
Growing Operations
Most states specify that facilities used to produce Marijuana must be “fully enclosed, locked facilitates that are inaccessible on all sides. These facilities are required to be inconspicuous.” Some states require that growing locations are the same as dispensary locations, but of course you need to check with your local laws to be certain of the rules on this. Grow rooms are colloquially known as Groves, and are custom designed greenhouses for the production of the specific plant. Drying rooms are kept at constant temperature and 55% humidity to ensure a proper curation (proper drying for ideal consumption) of the plant. You can review some details about growing operations in section 2 where we talk about operations, and in further detail in the next section when we cover strains and hybridization.
Support Businesses
There are additional ways that you can provide services to your patients, and ways that your business can improve the economy of your community. While this list is not exhaustive, it does provide a good basis.
Insurance companies for Marijuana industry; ATMs outside the shops; Edibles manufacturing; Cannabis drinks; Kush lounges; Cannabis restaurants; Cannabis themed tourism; Packaging companies; Bottling companies; Cannabis pizza shops.
Recreational Marijuana has already had interesting benefits including social events and fund-raisers that are promoted as “bring your own Marijuana.”
READ THE TWB GUIDE FOR MORE INFO ON– Suppliers ; Storefront ; The Retail/Co-op Exchange Space ; Finding Employees AND Finding a Job (Experience) ; Age Restricted Entry ; Safe Access Points for Patients
We are here to help and want to see you succeed! If you have questions you can email The Weed Business directly at info@theweedbusiness.com.
YOUR SEVENTH ASSIGNMENT
Hopefully by now you have secured your location, and begun implementing all that you learned in your readings and research on storefront operations. Even if there are still lingering things to handle in relation to your set-up, it is wise to move forward with becoming an expert on your product. There are a variety of strains that have been cultivated to produce desired effects related to specific conditions, and there are more being created every day. Deciding what types of patients you want to focus on will entail the last phase of setting up your retail space as well. For your next assignment, begin researching different strains, and if you already have a group of patients planning on joining your collective or co-op try to begin with strains that cater to their needs.
Happy Trails!
The Green Ninja, DANKO and the Weed Business Team
The Green Ninja has business experience from owning two companies, has operated The Weed Business since 2009, and follows news providers to stay as current on issues and business laws of Medicinal and Recreational Marijuana use in the United States. DANKO is from a Medical Marijuana state and has many card carrying friends providing first hand insights from patients and caregivers, in addition to researching and writing in-depth articles about the most current issues of the industry. Combined, we have spent hundreds of hours looking into different states’ medical Marijuana laws and the industry to make sure the information included is the most cutting-edge and up to date information there is. The Weed Business has a number of other contributors and a large support network, so if you have a question we can’t answer there’s a good chance we know someone who can.
Move On to WEEK SEVEN
