Marijuana Business Magazine May-June 2020

Marijuana Business Magazine | May-June 2020 92 Bob Ramstad, owner of Seattle-based OZ. Recreational Cannabis, recommends keeping as little cash on hand as possible. Courtesy Photo B reak-ins and theft are universal threats at cannabis businesses. In recent months, thieves have targeted marijuana retailers in Chicago, Seattle, Bozeman, Montana, and Sacramento, California. In Denver, dispensary robberies hit a three-year high in 2019, including a rash of six related armed robberies. To protect cannabis businesses, security options range from basic to elaborate. In general, dispensaries need robust security systems. Even more important, experts say, are policies and procedures that prioritize risk management to defend a store’s people, products and reputation. Marijuana retailers are appealing for thieves because they’re open to the pub- lic, sell a valuable product and often are paid in cash. “Dispensaries have quick money and limited security,” said Tamala McBath, chief execution officer for the National Cannabis Risk Management Association (NCRMA). “Now, dispensaries are taking the place of easy targets like liquor stores and convenience stores.” While Denver police said the six armed robberies in 2019 targeted prod- uct, that isn’t always the case. “In the early days, product alone was maybe enough to be a real draw for thieves, but cash is much more attrac- tive,” said Morgan Fox, media relations director for the National Cannabis Industry Association. With the SAFE Banking Act held up in the U.S. Senate Banking Committee, the industry doesn’t have a clear path away from its cash economy. And projected cannabis sales around $28 billion nationally by 2023 amounts to a lot of cash. MANAGING CASH Being smart about cash is an obvious way to reduce risk and protect profit. Bank or credit union accounts can help, but they can be pricy and hard to find. “Anecdotally, I’ve heard of people paying $5,000 a month just to keep a business checking account open,” NCIA’s Fox said. Some cannabis stores have on-site ATMs. Others are turning to cashless ATMs. Some of these machines provide a voucher for a customer-selected dollar amount, which the customer hands over at the register. The clerk returns the difference between the voucher and the purchase price in change. Other systems let customers use a debit card at the register. Customers pay ATM fees for both methods. Cashless ATMs aren’t a fail-safe, according to Bob Ramstad, owner of OZ. Recreational Cannabis in Seattle. “The prices are high, and it’s likely federally illegal for the customer because they are transferring money over state lines to buy a Schedule 1 drug without permits. Because it happens in cyberspace, it’s inherently federal. If they hand cash to us at our counter, the sale is in Washington state and not subject in the same way to federal laws.” Cash-transfer apps provide another option. Among the better known services is PayQwick, which operates like the Starbucks app, but for cannabis. Customers fund the app from their bank account and then use it to pay at the cannabis store. The company, which is based in Calabasas, California, has active or planned operations in 18 states. A rash of break-ins and thefts at cannabis retailers around the nation has further driven home the need for stringent security measures. Regulatory requirements are just the beginning of what you need to secure a cannabis retail outlet. Here are security practices stores should implement, above and beyond regulatory compliance: • Run scenario-based employee training—during onboarding and at regular intervals—to reinforce what to do in an emergency. • Provision doors, cabinets, vaults and cash registers to control access during and after business hours. • Install cameras that offer real-time live monitoring, not just recording. • Try to open a bank or credit union account to reduce the amount of cash on hand. • Think carefully about whether a guard, armed or not, is right for your business. Beyond the Vault