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Wednesday, Feb 1, 2023
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Compliance Complexity For Valley Pot Vendors

For Greg Meguerian, chief executive of The Reefinery in Van Nuys, state compliance and regulatory requirements have been a necessary headache for entrepreneurs looking to run a cannabis business above the board. Regulations specific to the industry – including mandatory monthly reconciliation forms for inventory, state-issued stickers placed on every lab-tested product and navigating Metrc, a state-approved online platform designed to be the “track and trace” system for the cannabis world – costs a lot in both time and money. Stringent requirements made by the state have led to peripheral companies popping up to help with compliance, such as Blaze, a Los Angeles software service company that offers Metrc-friendly interfaces from seed to sale. The company’s chief executive, Chris Violas, ran his own dispensary in the Bay area, Cannibest, for four years before selling the company to start Blaze in 2016. Violas’ father is an attorney that has specialized in cannabis compliance since 2005. “I realized right away, there are logistics issues,” said Violas of his time leading Cannibest. “That’s still kind of prevalent today. We have software that helps with routing drivers, and there’s a lot of regulation that goes with the amount the delivery service can carry on a vehicle, collecting a signature when dropping off products, very similar to FedEx and how they drop off wine, they get a signature to verify they’re over 18.” Violas ran his business when Proposition 215 was in place, which only allowed medical marijuana – Proposition 64’s authorization of recreational use is a completely different animal, Violas said, in that the business is more closely monitored.  Blaze’s software for cultivation, distribution and retail businesses, as well as manufacturing starting next year, helps navigate requirements under Prop 64. “There are all these things Blaze is doing on the back end to communicate with the state to articulate where this inventory is and make sure it’s within the regulated market,” said Violas. “Blaze Grow is sending all that information back to the state government so that they know, here’s what’s in the legal cannabis market – it started from this farm, it’s licensed, it was harvested on this date, all of the active agents in it.” Meguerian, who uses Blaze for retail and distribution, likes how the business helps streamline his vertically integrated business and meshes well with the state’s Metrc system. Blaze products went to market last year, with Reefinery being one of its first customers. Other Valley businesses that use Blaze include Kushism, also in Van Nuys; The Clinik in Chatsworth; Natural Aid in Sunland; Weedway in Tujunga; and Green Dragon in North Hollywood. Meguerian’s Reefinery has been a guinea pig for the software company, working with Blaze to make changes along the way since signing on in January of last year. “Their manifests are good, their delivery portal for GPS tracking, which is required by the state. That software is really nice for the delivery portion; that’s another area where they help us with compliance,” added Meguerian. “Mostly, it’s just making it easier for the business owner to be able to track and trace, and look at what’s going on.” Businesses without a compliance software system have had to hire an employee just to do monthly reconciliation reports, compiling information and filing it with Metrc, Meguerian added.

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