Reality of what just happened to the MMJ industry...

Something written that many should understand by many:

We're all fighting harder than anyone can imagine to keep this industry moving forward - wherever you shop, give those whatever due respect you can b/c they're putting their lives on the line to keep it going, for money, love, or just to make a living and enjoy what they're doing.

And for those that think MMCs are making a killing, wait until 2012 when half of them really close because of the IRS tax laws that will prove that cash in the bank comes along with the income tax on gross profit - which means that not one penny in 99% of the dispensaries can be written off for expenses with the way they're operated. Make $1m a year, cut that in half, take out the $20k per month it takes to run a nice/pleasant/professional center, and all you did was put your freedom and money on the line to make peanuts.

Don't by into the conspiracy theories. There is absolutely no argument to what I just said and there is not one dispensary that wouldn't back this. Patients need to understand the hurdles - and be more pissed off at the IRS when they hang their 'cease and desist' notices on the door of you favorite shop because they didn't realize that they weren't planning properly. And even if one did - odds are they barely made it past with a penny of profit. This is further being confirmed by Growers looking to make the same money as before not realizing that vertical integration would have to be completely necessary anyway for the industry to survive because of the IRS code.

Not trying to start wars or burst bubbles - just educating. The name of the game today is HB1284. But the bigger name of the game behind all of this that has been going on and is feared more is the CHAMP case that affects owner's taxes and potentially shows a $1m+ revenue business owing potentially tens to hundreds of thousands of dollars to the IRS = dispensary closed unless they were growing all along which any Grower knows that stocking the shelves with 30 in-house strains is a nightmare. Growers never had to grow this variety in one, two, or three places - at least not this consistent to stock shelves all the time and have new strains pop up. Unfortunately this law completely screwed the variety as MMCs will barely be able to keep up with their demand let alone have the 30% to wholesale and buy to keep variety going.

There's a sneak peak into the ownership problems occurring. A bit more than this thread asked for, but regarding that meeting, it wasn't about the patients - that's left to us to work our asses off to serve them best. If we don't, than we aren't named "Primary MMC" and can't grow, thus killing our businesses. Like it or not, prices will come down, service will go up, and bad businesses will have to close up shop. Unfortunately small mom/pops will be pushed out, but 90% of them aren't the ones that people are raving about on forums - there is a reason the busier ones are busy - they do a good job. And they'll afford the changes.

Killing the wholesale market is bullshit - not allowing basic capitalism. But the reality is that prices will go down as they will no longer be based on old black-market numbers... Risk High - Return High - Illegal grower go to jail - high risk. Legal grower not worrying about it as the owner of the MMC and OPC is on the chopping block - they get paid less, but less risk. But steady job and ability to make a good living doing what they love - growing - is now out there without the risks.

It's a new industry and a whole new business. And in the end the patients will love it. You can grow your 6 plants, shop where you want, see prices go down, and even have the option of having a caregiver grow for you instead of shopping at a dispensary.

For the Caregivers that care about the patients and want to grow not for the money, but the love, that still exists also. Yes, MMCs have to make money. 5 patient limits are stupid. But they do exist. If someone has a problem with them it's because they want to make more money. If for the love, than it makes your job easier - only 5 patients to worry about. And you pass the excess off to a friend. Or they go to a MMC which will have the $30 eighth. Watch the price wars occur... (this doesn't mean that MMCs don't put love into it, I'm just referring to the mentality that weed should be free which would be the first and only thing I could think of that would and ever has been free - besides air of course)

There isn't much else to it. At least we have this problem to begin with...... Better than it used to be.

And if you could help me/others see this from another point of view, please do, I'm a very open-minded person, but with a lot of experience so far in this, too many economics and finance classes lead me to this conclusion that not one dispensary owner or grower has disagreed with throughout the many/dozens of networking events and industry meetings I've attended - I'm all ears though, I won't fight this argument to the end, let it serve as a basis to open up a discussion as to where people think this is going.

I see a lot of places closing down and a lot of price wars along with an up in service - as an owner, I have absolutely no choice but to do a better job than the next guy to pay my bills (that's mortgage, food, tuition, whatever it may be for those out there).

I'm aware that there an are a few honest dispensaries that want to help patients. But 99% out there are owed by money hungry, hateful and shady people. As a patient I turned out to be very disappointed with them and their treatment of us. They couldn't care less about anyone and they don't hide it.

I hear almost nothing from growers but about how this will effect them and there profits. Some growers I know made 250k 300k and up, tax free!

It's a shame that the few good growers and dispensaries are being put out of business and all I'm left with are the assholes.

That being said, even as bad as it can get with dispensaries and growers, I still don't want MMJ being taking over by big money and the government. I feel this these bill was a big step in that direction.

I realize these comments are not going to win me any friends, but I'm tried of the bullshit. Marijuana should be legal for people who suffer with heath problems everyday and to those who just want to relax and have a good time.

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Originally Posted by donnadanko

I'm aware that there an are a few honest dispensaries that want to help patients. But 99% out there are owed by money hungry, hateful and shady people. As a patient I turned out to be very disappointed with them and their treatment of us. They couldn't care less about anyone and they don't hide it.

I hear almost nothing from growers but about how this will effect them and there profits. Some growers I know made 250k 300k and up, tax free!

It's a shame that the few good growers and dispensaries are being put out of business and all I'm left with are the assholes.

That being said, even as bad as it can get with dispensaries and growers, I still don't want MMJ being taking over by big money and the government. I feel this these bill was a big step in that direction.

I realize these comments are not going to win me any friends, but I'm tried of the bullshit. Marijuana should be legal for people who suffer with heath problems everyday and to those who just want to relax and have a good time.

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I'm in SW Colorado. Around here, the dispensaries are not owned by money hungry, hateful and shady people. They cannot operate at a loss, but the owners I know, with the exception of a couple who were trying to exploit growers even before 1284, aren't trying to exploit this situation. They are trying to adjust, just like the growers are trying to adjust. No one knows yet what is going to happen relative to application fees and application for a license doesn't necessarily mean they will be approved. This clusterfuck is going to take a while to unravel as it becomes obvious that it is FUBAR, even to the "authorities".

Quote:

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Originally Posted by puntacometa

I'm in SW Colorado. Around here, the dispensaries are not owned by money hungry, hateful and shady people.

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This. I'm all for strong regulation of these businesses, but it's not because I think their owners are scumbags. I live down here too and I like the owners I know.

Well, I wish those dispensaries nothing but the best than. I just hope growers/ caregivers who have patients that desperately need them are able to keep providing for them. It wouldn't hurt for the dispensaries to lower there prices a little either.

Romer's cartel-

from wikipedia

In microeconomics and management, the term vertical integration describes a style of management control. Vertically integrated companies in a supply chain are united through a common owner. Usually each member of the supply chain produces a different product or (market-specific) service, and the products combine to satisfy a common need. It is contrasted with horizontal integration.
Vertical integration is one method of avoiding the hold-up problem. A monopoly produced through vertical integration is called a vertical monopoly, although it might be more appropriate to speak of this as some form of cartel.
Nineteenth century steel tycoon Andrew Carnegie introduced the idea of vertical integration. This led other businesspeople to use the system to promote better financial growth and efficiency in their companies and businesses.

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when portions of this bill are deemed unconstitutional (i.e. the 5 patient limit) the model will fail.

Nobody has shown me how 1284 makes patient to patient sales illegal. Patient to patient selling will also pickup in a big way (IMO) as people realize if they aren't a caregiver, almost none of the restrictions in 1284 apply.. though we do gain from the recognition of increased counts in the bill. So, a husband and wife team, both with signoffs for increased counts could be at 99 plants without having a single patient.

think about that for awhile...