From Liberal Party insiders to pharmacists, many Canadians stand to gain from the legalization of pot. But one group of hardworking entrepreneurs is posed to be left in the cold when the $5 billion [$4 billion USD] recreational pot market goes above ground: your everyday weed dealers.
And there isn't likely to be a federally supported job transition program for the many, many people who depend on a steady stream of potheads to pay the rent.
In Vancouver, where pot has been an integral, and pretty much accepted, part of the economy for decades, weed dealers in Canada's priciest city are contemplating their options—and in some cases their exit strategies. For 31-year-old Chelsea*, the last year has been a struggle as uncertainty over what legalization will look like has her torn between trying to go legit and getting out of the game altogether. For nearly a decade, Chelsea has cut hair out of her home in Vancouver, but underneath the shampoos and conditioners that perfume the air an unmistakable pungency hints at what else is for sale. According to Chelsea, most of her clients leave with a fresh cut and a fresh baggie of weed.
It's been a successful business model that has allowed Chelsea to set her own hours and support her hair styling career, but the proliferation of an estimated 100 medical marijuana dispensaries in the city in the last two years has severely diluted her market. While pot once accounted for about 90 percent of her income, that's down to about half today, and with a fully legal market around the corner, she wonders how long she'll be able to hang on.
"It's really frustrating," she told VICE. "I'm trying to gauge from my clients like, 'Is it worth it for you to come to me? Are you just trying to be a supportive friend?' It seems like for some people it still is."
Most of Chelsea's remaining clients are professional women in their 30s and 40s and are seeking the kind of discretion that isn't available at most dispensaries, which (still) overwhelmingly exude a head shop vibe that seems more tailored to teenagers than adults. A recent crackdown by the city that saw some dispensaries closed has eased the pressure somewhat on casual dealers, providing Chelsea with a boost in sales. But many dispensaries are still open and willing to sell to anyone who meets a very loose health criteria for medicinal pot—some even have "doctors" on-site to do diagnostic assessments. With existing dispensaries and big corporations poised to corner a recreational market, Chelsea said she's part of a dying breed. "There's a lot of private weed dealers who have just stopped, she said. "It's just not something you can rely on anymore."
To deal with the downturn, she's been trying to ramp up her hairstyling career, but it would mean a major hit to her income. And while she's considered opening her own dispensary, high real estate costs in Vancouver and business licensing fees—the city charges $30,000 [$23,000 USD] for dispensary licenses, versus about $5,000 [$4,000 USD] for liquor serving establishments—have put that goal out of reach for many small players. "I would definitely have to have like $1 million [$800,000 USD] startup capital to start anything," she said. "This city's too expensive, and they're making it hard so only certain people can get in."
Mary Jean Dunsdon, better known as Watermelon, is a pot activist and dealer famous for roving Vancouver's clothing optional Wreck Beach and selling her signature ginger snaps with a not-so-secret ingredient. After 22 years and multiple arrests—all of which resulted in acquittals—she "retired" last year from dealing in the buff to concentrate on a wholesale market for her edibles. However, the patchwork of municipal regulations for dispensaries and a constantly shifting market have made it a tough go. Vancouver's dispensary boom initially gutted her clientele but soon after resulted in a growth in her wholesale business, but the windfall didn't last long. "What I lost in clients I gained in wholesale business—and then the City of Vancouver came along and said 'no edibles,' so it crashed again," she told VICE.
With her goods prepared in a commercial kitchen, Watermelon said her cookies are consistent in their dosage, but she worries federal regulations will be overly onerous and put small producers like her out of the game. With staff who rely on her for their income, Watermelon said she's been forced to diversify to stay afloat. For now, she's building up her wholesale market in dispensaries outside of Vancouver, and she still sells to private clients in town. But she's also started an online marijuana cooking show and is writing more on the subject. She also bought a candy store on Vancouver's Commercial Drive in 2012 with the intention of operating it as a front for her edibles, but she soon realized her notoriety made the endeavor too risky. "It was just so obvious," she said. Today, the Licorice Parlour sells straight-up candy and hula hoops and is self-sustaining—but it's not a money maker.
Intent on staying in the game, Watermelon sees massive potential for someone with her experience and skill to make an honest living out of a legal pot market, but she fears small players without her resolve will be shut out. "The sad reality is a good percentage of the revenue that's going to be made off of this will be from a big corporate angle," she said. "There's a whole bunch of people who are going to get lost in that mix."
Others are betting on a gray market persisting to undercut the inevitable price increases that will accompany a regulated pot industry. "There's always going to be some guys on the fringe," said Jeff*, another casual dealer who VICE talked to. A management professional in his late 30s, Jeff claimed he isn't all that worried about losing business to a legal market—he only stays in the game to ensure his access to free, high-quality weed and make a little "play money"—but he said his distributors are stressed. "Right now, there's a lot of nervousness with those guys that are higher up than me because they're trying to position themselves for when it goes legal," he said, noting the weed he sells now is already the same stuff you can buy in dispensaries at considerable markup. And as long as that's the case, Jeff explained that he doesn't see his business drying up any time soon, but that legalization may even help his case as the stigma around smoking pot is lessened. "The marketplace is finally catching up with what we as a society view as normal," he said.
But that doesn't mean penalties will be lessened for private dealers who persist in the black market. In fact, it may do the opposite. For Chelsea, a top fear—if she stays in the game—is being prosecuted for tax evasion. With so many unknowns, she's considering ramping up her hair career, but it would mean a considerable downgrade in her standard of living (she recently took a full-time job at a hair salon but quit when she realized the job paid minimum wage). In the meantime, Chelsea explained that she'd raised her prices on pot and is hoping her existing clientele will hang on while she lives on what feels like borrowed time.
"I'm scared about what's going to happen," she said. "I feel like I have a job with a company that's about to go bankrupt."
*Names have been changed or abridged to protect subjects' identities.
By Jessica Barrett - Vice/June 7, 2016
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