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Potcast is the preeminent source for information about and for the cannabis industry. Every episode will analyze the business of cannabis with interviews and news from inside the industry. This show is the tool you'll need to educate yourself about cannabis and cannabis regulations.
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This podcast is intended for a mature audience over 19 years of age and is provided on an educational and informational basis. Any material presented is for informational purposes only and should not be taken as a substitute for professional medical advice or as an endorsement or medical claim by Patterson Media, Everything Podcasts or Ripco .Pro.
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Cannabis is a commodity. Before we consume it, we trade it. Back in the day, that trade was more hidden than it is now. Okay, what do you got? But the world is changing fast. Now cannabis is legal, at least in some places. We don't just trade it within the states in Canada. There are international markets too.
I spend most of my time at the start and end of the cannabis trade chain. I grow it, I consume it, but I don't know a lot about what happens in between.
So I wanted to learn about the cannabis trade and about distribution. So we turned to a distributor, Purple Dispatch, and we got two of their guys on the show to talk to us about how that works. You have to find the right balance between being a weed person and being a business person. If you're too much in one camp or the other camps, then you're not going to be able to run an effective business. And to go beyond our borders, our reporters spoke to a fellow journalist at the United Nations.
where global drug policy is made. was actually present in the UN General Assembly when, I believe it was two presidents ago, the president of Mexico stood up and said he planned to legalize cannabis. And everybody who was half asleep in the GA suddenly started giving him a standing ovation and cheering. I'm Don Schaeffer. I'm Ross Rebiliade. This is the Podcast. And here's the Podcast with Jay Coburn.
Cannabis retailer Tokyo Smoke is closing 29 stores and restructuring its business under the company's Creditors Arrangement Act. OEG retail cannabis, a company run by the owner of the Edmonton Oilers, bought the Tokyo Smoke brand from Canopy Growth in September 2022. Tokyo Smoke will still have 167 locations open across four provinces.
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Cannabis smuggling by air passengers into the UK has increased significantly this year. Around 15 tons have been seized so far in 2024 and 378 people arrested. That's already three times more cannabis seized than in all of 2023. Around half of all the arrests so far this year are related to cannabis that originated in Thailand, with 75 arrests related to cannabis originating from Canada,
and 47 from the US. And Donald Trump has come out in support of legalizing cannabis for recreational use in Florida. Trump is an official resident of Florida and so will be able to cast a vote on the state's amendment 3 in November which would allow adults over 21 to legally buy and use cannabis without a medical card. In a Truth Social post Trump said
Personal amounts of marijuana will be legalized for adults, whether people like it or not. His rival Kamala Harris has called this a raisin flip -flop. That's The Pot News. I'm J .Coburn.
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Before we go to the United Nations, we're going to hang out with two people from a homegrown distributor here in Canada. Erd Deynefelt. I'm the Chief Commercial Officer at Herbal Dispatch. My name is Philip Campbell. I'm the CEO of Herbal Dispatch. I've been a long time cannabis user, really passionate about the industry and excited to be here today to talk to you about it. Herbal Dispatch has been around since 2015. They do have a license to produce cannabis, but these days,
They stick to working with producers to get their products to patients and customers. Verbal Dispatch started in 2015 as a mail -order marijuana business or MOM. And it grew very rapidly. It was very brand focused on developing brands and working with small craft producers across BC primarily and was distributed across Canada.
We're a little bit differentiated from a lot of other licensed producers or LPs in the industry. We don't cultivate, we don't do any primary extraction or any of the kind of heavy capital intensive aspects of the business. We really focus more on processing the last couple of steps in processing and then sales and distribution. My own expertise is in growing, but there's not much point in growing great weed if it's not going to get smoked. Though I want to get it to customers, but I'm just one guy.
So I need people like Aaron and Phillip at Herbal Dispatch. We're going to chat about how growers like me can get their products to market, as well as common mistakes to avoid. But I'm a weed guy, so I've always wanted to be close to the plant. That's why I started asking the guys what drew them to distribution over growing. way we saw it, there was a lot of overproduction in the marketplace and a lot of product being sold for actually below the cost of production.
So we saw an opportunity to make margin by buying and selling. Also, there's a history of that within everybody's kind of shared collective experience and through also her dispatch experience. So it made sense. Being in sales and distribution, it's a lot more scalable. We get to work with a lot of really great partners this way as well. A lot of really great growers and brand partners and help them to be successful. Also what feeds this is our location, actually. Like if you look at the other businesses in the area that we are,
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Richmond here, it's cross -docking, food products being distributed. We're in an excellent place to service the Lower Bay Lab, but also to get out of the province. We're really close to the BC Liquor Board warehouse. So that seems like a small part of it, but it's real. I think that's helped us a lot here too. What do you look for in a supplier? Producers like me, how can we be more attractive to distributors like you? Interesting question.
One thing that we do now with a lot of brands is actually unpacking their sales strategy and do they have boots on the ground? Do they have sales people that are working? Because there are a lot of products and if you're not marketing your product and if you don't have a plan for your product, it's going to be really hard to move it. There are really good sales teams out there and marketing is the difference between I think a product that moves and a product that doesn't get seen.
And when you're talking about marketing, it's actually like boots on the ground going in personally to visit shop owners and bud tenders and stuff like that. Cause there's no actual print marketing or that sort of advertising that's allowed in the industry. that basically what the reps do is literally walk into the stores and talk to the people that are working there? Yeah. So a good product with good boots on the ground. And then I think we do have a layer of built -in marketing, digital marketing, just on our platforms that people can access. So rather.
just a line item with a number and some letters. You can actually see photos. can connect to online reviews. There's more to your platform than simply just a fulfillment mechanism. the supply side, we work with about 200 licensed producers across the country. One of the things that really differentiates some companies from other ones is their responsiveness and their attention to detail. There's a lot of compliance obligation in purchasing products and bringing products to market.
And it's really helpful to work with brand partners and suppliers who have the same level of attention to these details that we do, because it can really bog down the process and lead to potentially recalls if people aren't dotting their I's and crossing their T's. Yeah. The recalls are a killer for small producers like the micro craft guys. And you don't want that to happen. obviously having that marketing team and making sure that the product is solid.
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I bet there's quite a few common mistakes or pitfalls that you might see producers fall into. Tell me about some of those pitfalls. What should producers like me be avoiding, for example? The biggest driver is THC and price in the market. Right. And it keeps coming back to the THC. Yeah, it's still a very nascent new industry where consumers are kind of driven by the highest THC percentage, which is unfortunate.
And also just given the times in the economy right now, people are very strapped for cash. so price is also a big factor. I think in bringing products to market, it's easier to compete on price because people can just do the math in their head. If you're coming out with a premium brand or premium positioning, then really conveying the value of the brand and why you're branding that extra premium is important. So that people understand that they're not just
paying extra money for the sake of it, they're paying extra money because they're going to get something in exchange for it, whether it's a higher quality product, one that's been cured better, one that has other attributes that are better than some other ones. Things like harvest dates can be important, chirping information, chirping profiles, putting that on your packaging. So any of that kind of value added stuff that you can put on really will help to differentiate it and potentially command a bit of a better price.
One of the biggest things that I've noticed since we brought Rosgold to market a year and a half ago was just the pricing. And if you want to be a premium brand, your tendency is to price it a little bit higher. If you don't, you might fall into that pitfall of the race to the bottom and be competing with the big licensed producers where they're just basically undercutting the market. So it's like a fine line between wanting to be a premium brand, but also needing to move product and bring in revenue.
I feel for the producers out there, having gone through it myself, you kind of get stuck between a rock and a hard place there. We've all been in the industry since before legalization. So I wanted to talk a little bit about what distributing in those pre -legal days was like when recreational cannabis was against the law. How did you find ways around that back in the day? What was the strategy? Not doing interviews like this. Laying low. Yeah.
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You know, I had my store open in 2015 in Kelowna. We were open for a couple of years. I was nervous about it, but felt like the time was right for me to get involved. We had the police chief, we had the fire chief, we had city council come through the store and see, we wanted to show what the future of cannabis looked like. Having said that, I did feel like I had my neck kind of on the chopping block and that anything could happen at any moment. So we did the same thing as you guys did. We shut down pre -legalization and
We didn't emerge and as you know, until a year and a half ago. So we waited for about five years for the goalpost to stop moving. Do you guys ever miss that era? Well, one thing I don't like about this era is the excise tax. Right. So I fondly miss not having to pay such large excise tax bills. That's certainly a very large impact on the industry and where it's at today and why so many companies are struggling.
About 30 % of all of our revenue goes to excess tax. Back then, a lot of people were doing it for the passion and for the love of the industry. Yeah. And now I feel like a lot of people got into the recreational, the new market with that same passion, but it's been tampered a little bit because of the reality.
In order to have a legal market, it has to be regulated. It has to have a lot of compliance obligation and record keeping and excise tax payable and all of these things that are necessary. But I don't think a lot of people really thought about it before. Like this was going to be what a legal market would look like in hindsight. Obviously it makes perfect sense that this is what it would be. But back then, I don't think that people really foresaw all of these complexities and challenges.
So guess I kind of miss the ease at which you can do things and the reasons that people were operating in the industry. And now I feel like people are a little bit jaded or a little bit, you know, mignotant for the right reasons for some people. We've all seen a lot of cannabis businesses disappearing, going bankrupt. Herbal dispatch survived. Why do you think that is? You have to find the right balance between
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being a weed person and being a business person, if you're too much in one camp or the other camp, then you're not going to be able to run an effective business. You know, if you're too much on the business side, then you're not going to appeal to the consumers. If you're too much on the weed side, then you're not going to be able to run an effective business. so I think finding the balance between the two, somebody else mentioned this, this isn't my saying, but finding the right balance between bro and pro. Yeah. So we're in the middle. As far as international markets, you guys have started moving product overseas.
What are some of the other countries that you guys are distributing to right now? We've completed successful exports to a couple of companies in Australia, to a couple of companies in Portugal. We have permits in place right now for Thailand to export some seeds. We're working on Israel, the UK, Germany. So there's about maybe 20 countries across the world that you can export into that have any meaningful market right now.
We recently just got some of our products approved in Brazil, which is exciting. Amazing. We've been talking a little bit about distributing overseas and international markets. And probably for some listeners, they're hearing international and we've all been through that whole traveling thing where we can't bring weed with us and it's crazy.
So they're probably picturing something old school as far as sending that product overseas, like in boats and packages wrapped in duct tape or something like what they've seen on Narcos. In reality, there's a whole process. Maybe you could speak to what you have to do to get weed from Canada, like literally with the weed itself, the packaging. What does that look like?
compared to just moving it domestically? Good question. Yeah, it's definitely not like in the movies. It's a regulatory process. The importer needs to get an import permit. The exporter can then get an export permit. You have to get a phytosanitary inspection. It's a lot of paperwork and regulatory compliance required. Documentation, finding couriers, and then the packaging. You have to make sure that there's no smell, so sealing it properly.
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Typically we ship at air mail, so it goes by plane on pallets. there any airlines that do not allow cannabis? Some airlines choose to participate in this or not. And I think what is still current from perhaps old days is that then the relationship with both the supplier and the buyer is the key to success, right? Do you have suppliers that are willing to be straightforward with the type of product they bring you? And if there's issues, will they?
work with you or not, and then buyers, it's a risk you're sending product to a different jurisdiction. How does the money work? What happens if there are issues and so on. So there's a lot of relationship management that's part of this, just like you would imagine. What's the future for Herbal Dispatch? Where would you guys like to see it go? Great question. Thanks Ross. We're super excited about the future. We're still very Oshnet driven. Going to bring the Herbal Dispatch platform global.
We're in the early stages of how we can take that medical cannabis marketplace and then export it into other markets like Australia, Germany, where they have federally legal programs. And then we can leverage our strengths as a tech -enabled company to bring that marketplace to other jurisdictions and be able to increase access to patients for medical cannabis. So I think in the next kind of six to 18 months, we'll be looking at opening up the marketplace in other countries.
which is pretty exciting for us. I'm stoked to be able to bring Canadian cannabis into other parts of the world. That was Philip Campbell, CEO of Herbal Dispatch, and Aaron Taggenfeldt, their Chief Commercial Officer. Check them out at herbaldispatch .ca. A lot of governments realize they can break in huge tax revenues if the business is fully legalized. As we wrapped up our conversation with Herbal Dispatch, we started to talk about international trade.
Canada, Netherlands, Mexico, Jamaica, Argentina, Peru, Ecuador, Uruguay, Belize, there was one big elephant in the room there. One country that wasn't mentioned as an option for herbal dispatch to expand to even though they're right next door. The United States, because cannabis is still federally illegal there, even as individual states are legalizing it. Alaska, California, Colorado, Illinois, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and Washington.
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In fact, the United States was instrumental in making cannabis illegal globally. They were one of the driving forces at the United Nations when they enacted the Single Convention on Narcotic Drugs in 1961. Where it was listed with heroin, cocaine, opium and several other opioids. That convention has changed a little, but the laws the country's made based on it are still largely in place. And that means that cannabis is illegal in more places than not. So trading across borders is difficult.
and often impossible. You might grow cannabis in New York state where it's legal, but you can't carry it across the border to Ontario where it's also legal because of the federal laws enacted after this convention. But things are changing slowly and surely. The world is becoming more open to cannabis and the movement of cannabis across borders. So we're speaking to someone inside the United Nations, someone who chats with ambassadors regularly.
My name is Sarah Brittany Somerset. My cannabis career goes back about 15 years. I started as a cub reporter for High Times Magazine when I was living in Jamaica, the island, not the city of New York. And I parlayed that into a bureau at the United Nations. I was the first and only cannabis correspondent, drug policy reporter, dedicated drug policy reporter at the United Nations since 2011.
Sarah Brittany sat down with our reporter, Jay Colburn. I'm so fascinated because it's such a big institution. I imagine it's quite an old fashioned place with a lot of decorum. Most people, myself included, have never been in the United Nations and don't really know how it works. Talk to me about being that reporter and setting up that desk. I was always really interested in drug policy, especially progressive drug policy. I noticed, obviously, at the UN, there's a lot of committees and regulation bodies that
make global rules around cannabis. Like if you look at the 1961 single convention on narcotic drugs, that is the treaty that's been keeping cannabis scheduled worldwide for 60 years. So when I first applied, I applied as bureau chief for high times and the people in charge, you know, the media liaisons were like, what? Like they were completely flummoxed by my request. They were totally transparent, but you know, this is a
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drug magazine, what would you cover here? And I basically gave them a coach and argument, like I just told you, I'm here to cover the UN Office on Drugs and Crime. I think we have a right to be present. they were kind of reluctant and hesitant. And they put me on sort of journalism probation where they were going to let me get my foot in the door and then, you know, watch me for the first few months.
It was kind of funny because I had this idea, like you said, it's this bastion, this modicum of decorum. So I'm showing up my first day, I'm in this rioni suit, I'm trying super hard to be very buttoned down and like GQ and just not make any waves. And everyone was talking about the cannabis reporter. It was like, have you seen the cannabis reporter yet? Have you seen the weed reporter? Hey, there's a drug reporter here. And I'm like, in the room, guys. And they were kind of like, no, but you're...
I'm like, not a babbling idiot? Why, yes, thank you. It really took the establishment by surprise. I don't think I was what they were expecting. I think they really expected me to show up like reeking of weed, Janis Joplin tie -dye t -shirt, the works. And my whole point is that, of course, professionals use cannabis. They're just in the closet about it. So I think it was very pioneering for me to go in there, very conservative, but also saying,
Everybody uses cannabis, it's medicine. I don't think they had ever heard that side of the argument before. It was always cannabis is a drug, it's bad for you, it's like heroin, it's bad. And I was coming in there saying the exact opposite. Cannabis is good for you, it's helpful, it's healthy. And really I was just there to cover the bodies, but also to open up and foster dialogue. I wanted people who are making these global decisions to be aware of the other side of the argument.
Are people still treating you as if you're going to be some like insane hippie or did they learn pretty quickly that you're a serious journalist here to cover drug policy? You know, it's interesting. I've been there 13 years. I still have temporary status. But you know, I do have a desk now and an office from which to work and you know, they don't usually allocate those if they don't expect you to stick around. They're actually pretty hard to come by. It's a bit of a land grab. So I was very lucky to get like a dedicated desk in which to work and establish my bureau.
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And I think just going to all of the events and being seen, people started to realize, I don't have three heads, I'm not high, I'm as normal as anyone else there, which is subjective. But my argument was basically progressive drug policy. And with a lot of the media at the UN, the majority of the UN media is state -sponsored. So they do have an agenda, which is to push their state policy forward. So I have a friend who works in the secretary general's office who jokes that I'm from the mission of Manhattan.
And he says to me, what's the latest at the mission of Manhattan? And I'll say, well, cannabis became legal. And I think while I was at the UN in the beginning, eyes were on me because it was an illegal substance that I was advocating for. But over the course of my time there, we've seen legalization in different countries. We've seen legalization in different member states. So I think the audience is becoming more receptive.
Everything's really come full circle where now I have other reporters at the UN who will sometimes approach my desk, they'll get assigned the errant cannabis story and they'll come to me to fact check or they just want to make sure they get their I's dotted and T's crossed. And I have diplomats asking me questions about CBD. My father has shingles, will this help him? And I always say, I'm definitely not a doctor, but I would ask your doctor, it certainly couldn't hurt if he's not on any contraindicating medications, things like that. I think people are just in generally more open.
to discussing it. It's not like whispered, it's not in the shadows, it's out. It's legal and people are aware of this. And now, you know, the big question is how are they going to monetize it? How are they going to bring their country forward to monetize it? And the big issue with it being in the original treaty was that it was listed as not having medicinal value. And now at least anecdotally that cannabis does have medicinal value. opens up, de -scheduling it from the convention opens up avenues to research. Now we finally have the opportunity to prove
that it does have medicinal value and what that is. So I think these are very exciting times. We're in liberal North America, on drug policy at least, but Canada and the US and Mexico are not the only nations at the United Nations. Do you get different attitudes from people from different countries about what you're doing there? How does it go when you try and approach someone from, say, Japan to talk about drug policy there, if you ever do?
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I've had some of the best conversations of my life with diplomats from various different member states. One of my favorites was actually with the former ambassador of Saudi Arabia. Prior to MBS, we think of Saudi Arabia as being the most oppressive regime. know, obviously women weren't allowed to drive. If you got caught with drugs, you could be, you know, literally beheaded in the town square. It was a very oppressive regime. And I had a very enlightening conversation with him where I talked to him about
some members of his extended family that were suffering from cancer and I suggested that he get them Rick Simpson oil. I just want to note here that the medicinal value of Rick Simpson's oil is currently pretty fuzzy. One thing is for certain though, cannabis is not a cure for cancer and any positive effects it may have in alleviating symptoms. So like we always say, speak to your doctor about medical concerns, especially with serious illnesses.
And he didn't even know that Rick Simpson oil existed, that cannabis oil could be used to help alleviate cancer symptoms. And so that was very interesting to him because obviously when you have a loved one who's sick, it's almost like, unfortunately, all bets are off. You no longer start worrying about, is this legal? Is this not legal? It's, will this help them? And how do I get it? And where do I have to travel to get it? Or where do I have to bring them to so they can get it? And he said to me, know, I wouldn't even know where to begin with this. I said, you can take your loved one to California.
And we had another conversation, sort of an extension of the first. You know, I said, well, I understand why you are reluctant to use cannabis as a medicine because it's haram, haram being forbidden in Islamic law. And he said to me, actually, Sarah, it's not haram if it's used to save a life. He said the intoxicant is haram. But he said, if you're using cannabis to save a life, it's no longer haram. So that was very enlightening to me because that's something that I didn't know.
And so when I explained to him that I couldn't say that cannabis would be life -saving, but it would certainly contribute to the alleviation of the symptoms and nausea from chemotherapy, etc. We know that anecdotally. It was a very interesting conversation and it really kind of empowered me and gave me the courage to broach this topic with other nations that I thought would be dead set against it. Now I was actually present in the UN General Assembly when
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believe it was two presidents ago, the president of Mexico stood up and said he planned to legalize cannabis. And everybody who was half asleep in the GA suddenly started giving him a standing ovation and cheering. And it was like a historic moment. He vowed to legalize cannabis. He didn't. I believe the person who came after him didn't. And it's still an ongoing process. But at least now we're starting to see this shift change where
politicians are using legalization as their political platform. Some would say dragging it out incessantly. We see that in the US with the Biden administration. Obama promised to legalize. He didn't. Biden promised to legalize. He didn't. But it's being used as a talking point. Whereas before, when I started at the UN, it was completely off the table. It was almost seen as like something barbaric. And now people are receptive to the idea. Do you feel like you're part of changing people's attitudes on
cannabis almost just by being present? I hope so. That's been the goal for the past 13 years was to get inside the institution and, you know, advocate from within, of course. So in a very self -interested kind of way, you know, we have a new Labour government in the UK. They said they wouldn't legalise weed, but they've only just got elected. I wonder, have you spoken to any representatives from the UK about their, like, positions on cannabis? Because it's so different to...
where Canada and America are going and where like, you know, Germany, Portugal, all kinds of places that the UK are nominally friends with are going. I'm being very self -indulgent here. But do have any insight into like the UK's position? Yes. Well, I like to say that every diplomat lives behind an eight -fold fence. This is a very oversimplification, but to describe it to people who have no idea about the UN system, you could almost equate ambassadors or permanent representatives to
publicists in a sense, they are the spokesperson for their country. Right. Right. Whether that's a king, whether it's a democracy, it all trickles down to like you have the president, prime minister, foreign minister, ambassador. The ambassador gathers intel and relays it back to the mothership. So any time you can get in their ear, it's good. So you want to tell them firstly about the health benefits, because that's the most important to me, the most impactful.
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But you also want to whisper a little bit about the economic benefits because all countries are looking for ways to increase their revenue, their taxation. In a perfect utopian world, that taxation would then be further channeled back into improvement in infrastructure, education, the arts, healthcare, et cetera. But it almost becomes like countries get a little jealous of one another.
If they see that ex -country over here has legalized cannabis, is bringing in millions of trillions of dollars, they're going look into that. And it's also going to get harder to police those borders. So now you're looking at reallocating enforcement resources. It's like cannabis was legal in Canada. What are you going to do? Send everybody up to Niagara to make sure nobody's driving in with it? When I flew into Toronto last, there was this trick question on the entry form. It was like, are you carrying cannabis?
And I was like, no, who says yes to this question? Obviously, if you think it's safe and you go, it must be legal in Canada now, so I can say, sure, I'm carrying it, you've just volunteered to be searched and denied entry. And we do see early cases of people who did try to cross borders who were denied entry because of that. So, you you still have to pay attention to obviously local laws. But the point is it makes it more difficult.
to police if it's legal in surrounding regions and not that particular region. And then you compound that with all the benefits financially that these regions are getting. It's almost like they don't want to be left out of that revenue. So that also helps open the conversation. And we look at the case of Morocco. I mean, they went from being one of the world's, one of the Europeans at least largest exporter to the plausible deniability of saying they weren't on board with it to legalizing it.
So I think more countries will definitely follow suit. As for England specifically, I can't divulge any like privy conversations that I've had because you know, have to keep things in confidence. But a person's outward expression is not necessarily what's in their hearts. But can I ask you to like whisper in the UK ambassadors here like, legalize it, legalize it, look how well it's going. I do that all the time. Yes.
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Once I got into an elevator with the ambassador of Canada and all of his minions and I saw his little lapel pin that he was from Canada and I said, I just want to thank you so much for legalizing cannabis in Canada. And he just chuckled. He was like tickled and all of his minions were like, you know, apoplectic. And then I said, I took it a step further. said, so if your mission is technically an autonomous region and it's legal there, does that mean I can consume cannabis at your mission?
And they were all like, ambassador, this right, write this And they tried to, you know, him away from the crazy cannabis reporter. That was Sarah Brittany Somerset, cannabis reporter and drug policy analyst at the United Nations. She was talking to our own reporter, Jay Colburn.
The Podcast is an everything podcasts production in partnership with Ripco .pro. The opinions expressed in this podcast are not necessarily the views of the podcast team or our partners. This show is intended for a 19 plus audience. Thanks to our host, Ross Robliotti, show runner, Karen Hibashi, senior writer, Jay Coburn and sound design by John Massacar. I'm Don Schaffer. Thanks for listening to Podcast.
Another Everything Podcast production. Visit everythingpodcast .com, a division of Patterson Media. Subscribe wherever you get your podcast.