Yet, more than a handful of hopeful investors and analysts would disagree. They insist on comparing the marijuana industry to the market for alcohol after prohibition. 

And that’s just silly.

Because even though the end of prohibition put illicit alcohol producers and bootleggers out of business, the legalization of marijuana has not had the same impact on its black market. Even after many years.

So it certainly does seem that the black market for marijuana will never disappear.

There are some sound reasons for this.

Why the Black Market for Marijuana Will Never Disappear

Again, we’re basing this assertion on the idea that things aren’t going to drastically change – like a cannabis eating beetle that devastates every crop on the planet, for example.

Of course, this would eliminate not only the black market, but the government-sanctioned marijuana as well. And all things tie-dyed.

Anyhow, there are three primary reasons that legalizing cannabis has not affected marijuana’s black market in the same way prohibition affected alcohol’s.

1. Mass-Produced Marijuana Is Missing Its Demographic

Given that 70% of Americans drink, marketing alcohol is a no-brainer. For many Americans, a drink or two each day isn’t unusual.

But a lot of people who are using marijuana on a daily basis are using it for medical purposes. So they need to have access to affordable and effective product.

This repeat customer demographic has no need for mass-produced marijuana though. Because let’s face it, mass-produced marijuana is a drag.

First, it’s more expensive than what they can get in the black market. And because it has to conform to governmental rules, it’s also weaker. Not a winning combination for those who need to use it on a daily basis.

Mass produced alcohol, on the other hand, does not suffer this fate. Most alcohol consumers would opt for gin that comes from a distillery (big or small) before dipping their cup in someone’s bath tub.

2. Marijuana Is Cheap and Easy to Produce

Those analysts who predicted that the black market would cease to exist didn’t consider how nearly anybody can grow high-quality cannabis.

Sure, the illicit market for alcohol practically disappeared following the end of prohibition. But have you ever tried making your own alcoholic beverage? It’s no walk in the park. And you end up spending more on the ingredients than you would have had you bought a nice bottle of wine.

Meanwhile, with a few hundred dollars for equipment and the ability to follow instructions, anyone can grow really good cannabis without all of the overhead costs that the big producers face.

3. It Is So Easy to Become a Caregiver

Michigan is the perfect example of this.

When Michigan legalized medical marijuana more than ten years ago, small-time growers became licensed caregivers with a fair amount of ease. They needed only a clean record.

During that time, caregivers served a limited number of patients, then sold their excess product to provisioning centers. These products hadn’t been subject to all of the testing required by the state. But provisioning centers worked around this by having patients sign waivers acknowledging they understood this.

It was a system that worked very well.

But now the state wants licensed provisioning centers to buy their product solely from large grow houses. And while caregivers can sell their excess product to these grow houses, it must first be subjected to expensive testing. After that, the grow houses can sell it at a much higher price.

In the end, it’s the consumers that end up paying more. And that’s a surefire way to drive them to get their product from the black market instead.

Selling Marijuana Is Tricky Business

It’s hard to say for certain that the black market for marijuana will never disappear.

For now, politics and the corporate mindset have taken a hold of the cannabis industry in an attempt to eliminate the black market. But in many ways, they’re only making it stronger.

Pretty ironic, ay?

Stay up to date on what’s happening in the world of cannabis. Keep checking back with our blog for regular updates.

The post The Black Market for Marijuana Will Never Disappear appeared first on GROW Cannabis Marketing.

Because it looks like, once again, marijuana caregivers are under attack.

But the real victims under this proposed new testing law will be the patients for whom they provide. And the winners will be those manning (and, to be fair, womanning) the marijuana black market.

It just makes no earthly sense.

What Does the Proposed New Testing Law Dictate?

In a grand and sudden WTF moment, the governor and LARA are now proposing that after March 31st, all caregiver product must go through a licensed grower or processor and be fully tested.

Since caregivers are fully supplying the market right now, the proposers of this law claim it’s a strategy to ensure that patients receive only the safest product available.

But why?

The current caregiver system in Michigan has been in place for over 8 years now. No one has become ill or died as a result of caregiver product. Plus, patients knowingly sign affidavits attesting to their understanding that the product they buy now is not tested.

Under this new law, specific marijuana medications will disappear from the market without notice. And for the many patients who rely on these, that’s seriously bad news.

The Pitfalls of Testing

So how is it that this required testing is likely to result in a flourishing black market, you ask? Here’s the deal.

Each product has a testing cost of $500 per test for up to 15 pounds of product. The majority of caregivers have small amounts of different strains – around 3-4 pounds each.

So if a caregiver has four different strains, then that caregiver is looking at spending $2,000 for four separate tests.

But here’s the REAL kicker. If their product fails, it must be destroyed. Obliterated. Annihilated.

This is all because of some pesky State law that says caregivers are not allowed to test their products before giving it up to the State. And once a “failed” product is in the State system, it’s eliminated.

Furthermore, although Michigan has the strongest testing in the country, it’s still wildly unreliable. Test the same sample at three different labs and you’re very likely to receive three different results.

So why the hell would small caregivers enter into this system? It’s really only the illegal growers who produce over 300 pounds per month who will be able to afford testing because of batch size.

In other words, the governor and LARA are essentially driving caregiver product onto the streets through illegal means and fortifying the black market. Big time.

Is There Something Suspicious Afoot?

Since we’re in the business of cannabis marketing and not political analysis, we won’t venture to answer that question.

But we will say that this new testing law seems like a big step in the wrong direction. Similar testing laws in Colorado have proven tough on caregivers. And if the rules of this proposed law are put into place on April 1st, patients will be forced back to the black market to get their medicine.

Licensed growers acknowledge that there will not be enough product until the end of 2019 to supply patients. And it’s been complicated keeping provisioning centers open through this.

So for the next eight months, why not allow the caregiver market to supply the patients until the licensed growers are ready? It’s been working just fine so far.

And if it ain’t broke, then why fix it?

The post Will New Testing Law Lead to a Marijuana Black Market Explosion? appeared first on GROW Cannabis Marketing.