Tag Archives: retail

screenshotCannaScore

Staying Compliant with CannaScore

By Aaron G. Biros
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screenshotCannaScore

Cultivators, manufacturers and dispensaries face a variety of ever-changing regulations that vary between states. The cannabis industry is notoriously inconsistent with regulations and as new legislation changes the rules so often, it can be difficult for businesses to keep up and stay compliant.

CannaScore provides a cannabis compliance auditing system that takes an inspector through questions around the operation, flagging areas that are out of compliance with state regulations. CannaScore works in Washington, Oregon and Colorado, and has plans to provide its services in Nevada and Maryland soon.

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Various screenshots of an audit being performed with CannaScore

After co-founding DANK, a dispensary located in Colorado, Kush Bottles Colorado, a marijuana child-safe packaging company, and Denver Consulting Group, license-to-sale consulting company for the marijuana industry, Greg Gamet co-founded CannaScore after finding third party compliance audits to be lengthy, time-consuming and inefficient. The company developed the program and a mobile app within one year and beta-tested it for another six months.

“We are trying to stay in code with city and state regulations, along with the Colorado Marijuana Enforcement Division [MED], who finally has enough money to go out and enforce those laws. CannaScore identifies areas of concern and allows business owners to take corrective actions before problems ensue,” says Gamet.

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The home screen of the app, CannaScore, on an iPad

According to Gamet, some of the biggest areas of concern for business owners involve making sure employees and day-to-day operations follow the extensive rules set forth by state and local governments. “The MED wants to make sure there is no hidden ownership [or] diversion of the product, and that dispensaries are following the rules, especially when it concerns public safety,” he says. “CannaScore can help businesses get a great overview on how they are operating within these rules that are enforced not only by the MED, but local police and fire departments, local health departments, and the Colorado Department of Agriculture.” The program will be available to other qualified consulting services to use through licensing agreements.

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An Audit Summary Report prepared for Cannabis Investors Group

The overall score, much like a FICO or Dun and Bradstreet score, rate an individual’s or business’ credit score, which helps business owners, banks, landlords and other stakeholders know what level of compliancy a cannabis business is operating. It also keeps a compliancy record on hand if a business is required to prove to a governing body its willingness to follow the rules.

In performing dispensary, grow, infused products, and MIP kitchen audits, CannaScore can give the consulting company that is performing the audit the ability to assist in the correction of any and all violations. “Once a violation has been found, the consulting company can work with the customer to get it corrected immediately, which will increase revenues,” says Gamet.

“Because rules and regulations change so often it can be very difficult to stay on top of managing everything that goes into staying compliant,” Gamet adds. “Keeping compliant in the cannabis industry is a full time job and CannaScore can make it easy.”

As the industry grows and regulators hammer out details in legislation, compliance will remain an important part of any cannabis business. Staying in code with local laws and state regulations can make or break a business.

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A Dispensary’s Road to Success

By Aaron G. Biros
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The Herbery, a dispensary with two locations in Vancouver, Washington, is currently awaiting medical endorsements from the state for both locations. The two co-founders, Jim Mullen and Rick Zahler, found a credit union to work with them, Salal Credit Union in Seattle. “There are five dispensaries in the Western part of Vancouver, so it is quite a saturated market,” says Jim Mullen. “But we have drawn considerable business and are very happy with the success of our two locations.”

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A view inside the The Herbery

It has not always been like that, says Mullen. There are several key ingredients that go into launching and operating a successful dispensary, all of which pose significant barriers to entry in an extremely competitive retail market. Rick Zahler won the second and third positions in Vancouver for the state i502 retail licensing lottery. Zahler has more than 40 years of experience in franchising restaurants, a background that gives him a competitive advantage in scaling up his business.

Mullen and Zahler formed a partnership in early 2014 and by that summer they had finalized their lease agreement, converting an old restaurant into their flagship store. They hired local architects, contractors, and CPA’s and began looking for staff. “We set out to find the best people who could provide a level of customer service that this industry needs to be recognized as a mainstream business,” adds Mullen.

“We are changing the perception that you have to go into some back alley store to buy your pot,” he says. “We have a very attractive, well-lit storefront; we get complimented on the look of our stores all the time, one woman called us the Nordstrom’s of dispensaries.”

Before the doors opened, Mullen and Zahler worked long and hard to find growers, manufacturers and processors that met their standards. “We wanted to fill our display cases and shelves with premium cannabis, so we found really high-quality indoor, outdoor and greenhouse grows across the state,” says Mullen. “We go out and do site visits to see firsthand what nutrients they use, along with their standards and practices, to really size up our suppliers and verify they are giving us safe and high-quality products.”

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A bud tender helping customers at the dispensary

The Herbery hit some early obstacles as the market in Vancouver became highly saturated with dispensaries like New Vansterdam and Main Street Marijuana grossing well over $1 million each in revenue in May 2015.

“Our competition received a lot of media coverage and brand recognition early on. We had to side-step that with heavy guerilla marketing including handing out cards and flyers on street corners,” says Mullen. “We continued to push our social media marketing campaigns, slowly building a clientele with quality products, affordable prices and good customer service.”

Of all the roadblocks they hit, Mullen said the toughest aspect of getting started has been simply “letting people know that we opened and where we are.”

“There are fairly strict marketing rules, and staying compliant is difficult when you are trying to get your name out there,” Mullen adds. “We have been doing what we can with billboards and ads in magazines, but really word of mouth has gotten us far.”

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A bud tender can give recommendations on different strains or advice on consuming edibles

Looking forward, Mullen wants the ability to market in a manner that is similar to other mainstream businesses. He is also excited to get endorsed to sell medical cannabis. “With so many people seeking high-CBD products for a variety of conditions like fibromyalgia, chronic pain, anxiety, and more, we want to help patients get access to the medicine they need.”

As cannabis continues to be studied for its true benefits, Mullen anticipates significant advances in knowledge to occur within a very short timeframe.