Business

12 questions for big weed

By Alex Halperin

This month saw the formation of a new anti-prohibition group, the United States Cannabis Council (USCC), with some of the country’s largest multi-state operators among its members. Led by Marijuana Policy Project executive director Steven Hawkins, the USCC presents itself as a vehicle to unite the fractious cannabis community under the banner of federal legalization.

USCC has called for descheduling cannabis, “social justice and equity for impacted communities” and “creation of sound regulatory environment” for the industry.

However, in interviews with WeedWeek, and other publications, Hawkins has offered little elaboration about, for example, what “common sense” regulation looks like, or how companies may differ in their perspectives. (Hawkins did come out against potency limits, saying consumer preferences  “should ultimately dictate what gets manufactured.”)

The details of legalization, how markets are structured, when it happens, how the industry will be taxed and many more, are worth billions for many of USCC’s members. It’s understandable that they’re reluctant to show their cards.  

At the same time, the lack of specifics underscores that still relatively little is known about how the industry, and its most significant players, envision the future, and what their success will mean for consumers and society. Their thinking also has implications for the hundreds of thousands of Americans who work in the industry. 

In an attempt to learn more, WeedWeek sent a CEO questionnaire to about a dozen large corporate members of USCC. The questions touch on strategy, marketing, equity and other key topics surrounding the end of prohibition. Almost all of the companies have solicited WeedWeek coverage in the past. But only one, BellRock Brands, provided answers.

There’s no reason to call out the companies that didn’t respond. The idea is to learn how these important players see the world. Shaming seems unlikely to make them more forthcoming.

Some of the questions are softballs, others less so. But as the industry enters a crucial period, with legalization gaining steam in the northeast and federal legalization looking more likely than ever before, I think they’re questions that matter, because they’re about what kind of industry cannabis is going to be.

Here are 12 questions for big weed:

  1. What do you see as your advantages relative to your primary competitors?
  2. How does your strategy/company differ from your primary competitors? Why do you believe those differences are advantageous?
  3. What demographics of consumer are you most interested in? How are you attempting to reach them? 
  4. Do you support state policies which cap the number of licenses? Why or why not? How does your position benefit you? The industry? Consumers?
  5. Do you support mandatory or optional vertical integration for state markets? Why or why not? How does your position benefit you? The industry? Consumers?
  6. Should homegrow for personal consumption be legal in legal states? Why or why not?
  7. Why did you join the USCC? What do you believe it can achieve that existing groups can’t?
  8. USCC has called for “common sense” regulation of the industry but has not gone into specifics. What does “common sense” regulation mean to you?
  9. Do you object to any aspects of the MORE Act passed by the U.S. House of Representatives in December? Which ones and why?
  10. Some observers believe MSOs would benefit from an incremental legalization process that would, for example, give them access to the financial system (and major U.S. stock markets) immediately, but prolong federal legalization for a few years so MSOs can grow without having to compete against liquor, tobacco and other mainstream companies. Would you benefit from such a scenario? Why or why not? Do you believe your competitors would? Why or why not?
  11. What do you consider an acceptable amount of social equity engagement, expressed as a percentage of revenue, for you and your peer companies? What do you consider your most important contribution to “equity” thus far? Why do you think relatively few MSOs have much in the way of meaningful equity achievements thus far? 
  12. One prominent MSO CMO recently said it’s very early for cannabis marketing. What do you see as the current role of marketing for the industry?
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