With the COVID-19 pandemic and increasing legalisation driving a surge in cannabis use, the sector’s producers, manufacturers and retailers are awash in cash, adding risk and costs to the most basic business transactions from paying employees and filing taxes to finding somewhere to store their income.
“All this cash flowing around is just a recipe for disaster,” said Smoke Wallin, chief executive of hemp health products maker Vertical Wellness Inc. “How do you account for it? Where do you keep it? How do you move it? Even in a safe, it’s a security risk for employees.”
Ryan Hale, a U.S. Navy veteran and co-founder of cash management firm Operational Security Solutions, had to persuade a weed farmer in California to stop hiding cash in a tree. On another occasion, Hale had to help a bewildered cannabis retailer who had lost count of the dollar bills overflowing from his store’s lockers.
Legal U.S. cannabis sales grew 30% to $22 billion last year, more than the $17.5 billion Americans spent on wine, according to data from Euromonitor. Sales are expected to jump more than 20% this year.
(Graphic: U.S. cannabis consumers growth: https://graphics.reuters.com/CANNABIS-CASH/rlgpdybdovo/chart.png)
The sales boom could have left cannabis companies with a cash pile of more than $10 billion to deal with last year, according to research firms Headset.io and New Frontier Research.
Big players can afford unmarked armoured vans and heavily armed guards to transport money…
