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Two Sides to Franchising Cannabis: Part 2


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Twenty-three U.S. states allow some form of legal marijuana use, primarily for medicinal purposes, while four states and Washington, D.C. have legalized its use for recreational purposes. With this growing cohort of states, the legitimacy of the cannabis industry is also rising as entrepreneurs examine how franchising can help them grow this still-untamed industry.

To learn more about the business, I interviewed two business owners with different stakes in this business, one clearly motivated by the cause while the other driven by current and future profits.

Here is the second interview. Click HERE to read Part 1.

 

Jeremy Carr is the CEO of BlazeNow and owner of Exhale Med Center in West Hollywood, Calif., one of the leading dispensaries in Los Angeles. Carr told me it’s the highest rated shop in the area, and those Google reviews show the level of enthusiasm for this outlet and the category as a whole.

“The best medical marijuana dispensary that you will ever find,” read one comment. “An example of how every dispensary should operate! The place looks like a high-end boutique with the best selection of meds from Los Angeles to Amsterdam.”

After exiting a career in real estate, Carr started funding and building cultivation facilities for area shops in 2010, and bought the license for Exhale two years ago before relocating to its current location.

With dreams of taking his business further, Carr would like to use franchising to add locations in Orange County, Colorado, Nevada and Washington, but said that the licensing process is a major hurdle in most cities, often taking more than a year to finalize.

Change may come after the 2016 election, he said, when more states may be added to the list of those allowing recreational marijuana, and said 2020 would be the earliest that there could be a nationwide decriminalization effort.

“I’m very interested in expanding. It’s about picking the right markets, the right locations that we could handle,” he said. “I definitely feel like I could put together the right team.”

Given the challenges of different laws in different states, Carr added that franchising would be a natural fit for his business, because he wouldn’t be able to send his product across state lines.

Government aside, the biggest challenges to his business are the “very high chance of robbery on both the retail and cultivation side” and difficulty in attracting traditional financing.

As to why this industry, with all its challenges, is a good fit for his ambitions, he flatly says he’s in it for the money.

“I would say I’m an entrepreneur,” he said. “I’m not a big smoker. I believe in the industry and the people’s right to participate, but I’m generally doing it for hopefully a payout. It’s a very hot industry.”

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The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
 twitter.com/mlarson1011.
 

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