Challenges of the Cannabis Industry
Life has a funny way of surprising us, doesn’t it? Here’s something I never saw coming: I met my cannabis-industry business partner at my daughter’s Girl Scout troop meeting! Eric Gaston, an EO Seattle member, was an attorney dissatisfied in his profession. When Washington’s Initiative 502 passed, he asked me and our other partner, Arne Nelson, to consider exploring the marijuana business.
After months of due diligence, we decided our biggest opportunity was in the retail space. We were lucky enough to secure two retail licenses through a state lottery process. It has certainly been an interesting journey so far. Here are some of the biggest hurdles we’ve faced entering this burgeoning industry together:
Initial funding. We couldn’t take outside money due to the federal precedence, so my wife and I cashed in our retirement to fund the venture.
Banking. Most financial institutions won’t bank with retail marijuana stores. We were one of the first to secure a banking relationship, business debit cards, and armored car pickup to mitigate financial and security risks.
Locations. Finding viable retail locations that met restrictive buffer-zone requirements was difficult. Vacant space and willing landlords were few and far between.
Branding/build-out/partnership. We hired a branding company to help us create our vision, mission and brand. This was paramount for our business, as not only was our concept new, but our partnership was, as well.
Lack of industry-insider knowledge. As founders, we have unique skill sets. Knowing the product and culture was not one of them. We aligned ourselves with experts to fill our blind spot—one of our best moves.
Communication issues. We are open late, seven days a week. This causes communication challenges as regular employee meetings and team-building exercises are hard to schedule.
Millennial employees. Each store has approximately 25 employees, mostly millennials. While they are enthusiastic and fun to work with, challenges persist; scheduling demands, calling in “sick” at the last minute and entitlement issues are difficult for managers to deal with.
Having “the talk.” Telling people what I do—including even my family at first—is an eye-opening experience. The most difficult thing has been the reaction of my children’s friends and their families. Not everyone is on the recreational cannabis bandwagon, and it definitely throws a wrench in my kids’ lives.
We currently own two retail stores and have several scheduled to open in 2017. I owe a huge amount of credit to EO for my success. In my 10 years as a member, I’ve gained invaluable knowledge and insight through my Forum and the Entrepreneurial Master’s Program. We wouldn’t be here today without EO!
Jeff Anderson is EO Seattle’s incoming Learning Chair and a co-founder of The Evergreen Market, an award-winning cannabis retail business with the mantra: “Educate. Elevate. Celebrate.” Contact Jeff at firstname.lastname@example.org.