The Washington State Liquor Control Board (WSLCB) just announced they are going to regularly release information about compliance enforcement and also publish revenue statistics from licensees in the I502 legal cannabis industry. This is an interesting move and signals a continued and rapid maturation in the legal cannabis industry.
The stated purpose is to offer an opportunity for legitimately operated I502 businesses to be acknowledged and documented, providing transparency to their operations. With this information banks can then more effectively meet very strict federal guidelines (guidance issued early in 2014) for any banking entities conducting business with state-legal marijuana licensees.
There was also a message implied in the fines levied by the WSLCB against a number of licensees due to inadequate compliance with the Washington State I502 requirement to track marijuana from seed to sale. This signals a robust and quickly enforced compliance mechanism from the state. There is no latitude when it comes to compliance with I502 and the WSLCB. They have long expressed their strong intent to make the Washington legal cannabis industry an example of legitimacy for other states to emulate.
Again, the intent of this action by the WSLCB is to move the transparency of all licensees in the I502 industry forward, thereby allowing banking with marijuana-related businesses to ramp up.
In tandem with the WSLCB’s compliance enforcement actions this points to an interesting way to view seed to sale compliance. Yes, I502 compliance is a requirement and can be tedious and onerous to implement and track. But if viewed in the affirmative, a simple and effective real-time compliance system can be a way to elevate a legal cannabis licensee’s business to a highly legitimate and transparent enterprise worthy of unfettered access to high-level business services including banking, insurance and others.
Effective compliance combined with financial transparency can provide substantial credibility and guidance both internally to each I502 licensee, but also externally. Furthermore, these measures in total provide support and guidance for accurate and strong business valuation, which provides financial leverage.
By choosing compliance software carefully to optimize the compliance function, and then leveraging this data connected to financial verification, compliance becomes competitive advantage.
Eric Ogden is Director of Business Development for WeedTraQR – simple seed to sale compliance, and a principle in Greenleaf Consultants providing SMB consulting. A life-long advocate, Eric is interested in advancing a transparent and compassionate legal marijuana industry.