Rebranding, whether it applies to products or individuals, poses a significant challenge within the cannabis industry.

As the California cannabis sector gradually emerges from the turmoil of recent years, those who contributed to its struggles seek to join the soon-thriving market. They endeavor to conceal their involvement in the previous failures.

The detrimental effects of rebranding permeate every aspect of the marketplace, extending beyond the legal domain.

The Ambition of the Shady Players in the Recreational Market

Individuals who exploited the industry until now, leaving behind the chaos we find ourselves in, are observing the end of the dark times as bulk prices creep up. They are now witnessing the resurgence of value as the post-pandemic price crash subsides. Who would have predicted that the cannabis industry, only three years later, would find itself in such a predicament after experiencing its most prosperous sales period? However, sales eventually began to decline, and numbers were down for years until we started our recent climb out of the hole. 

But back then, prices continued to plummet, with a market oversupply devastating pound prices. If a product made it to the shelves, one prayed that the dispensary could afford to pay the distributor. You would assume that partnering with major distributors would secure access to the most shelves—a safe bet, right? Nevertheless, we recently witnessed the demise of Herbl, causing a considerable loss of livelihoods. As the company was on the brink of collapse, more aware brands swiftly switched distributors, demanding payment for their products directly from retailers. Unfortunately, it seems that the rest are left empty-handed for now.

I spoke with an entrepreneur who faced the perfect storm caused by the collapse of Herbl. First, he claimed that he was charged an additional $30,000 due to discounts on products that were initially paid on delivery with cash. Furthermore, one of his tenants lost everything in the collapse and hasn’t paid rent for two months, struggling to stay afloat. Lastly, the entrepreneur is unable to obtain the products he needs for his shelves until new distributors pick them up or he figures out how to handle distribution himself. Both options are time-consuming.

It is disheartening to consider that those responsible for inflicting these hardships on so many people may evade accountability. While retailers bear some responsibility for not settling their debts, should we allow those who perpetuated an unsustainable system, which lacks bailouts like the banking industry, to absolve themselves of the sweat, money, and time lost in this ordeal?

Certainly, the blame does not lie with the young individuals manning the booths or attempting to sell the products. They had no say in how far the company would stretch itself before the disaster that unfolded this week. Perhaps only a few individuals bear true responsibility. Understanding each person’s role in that current cannabis tragedy is crucial.

Although Herbl stands out as a recent catastrophe, numerous other companies also mistreated people. Some caused harm inadvertently, while others acted out of misplaced self-belief. However, the most egregious offenders are schemers who are eager to reenter the market, while the other two likely bear some trauma from their actions. We must not allow them to return solely to line their pockets and inflict further damage.

However, the issue extends beyond distributors.

Questionable Retail Operators Sold Shelf Space to Busters

These individuals are the ones who secured shelf space at corporate dispensaries, thereby overshadowing small, high-quality businesses through the payment of slotting fees. It is possible that they initiated the concept of slotting fees completely eroded the notion of customers obtaining the best value for their money from location to location. Many of those who managed to secure such positions were unscrupulous individuals with extensive networks of like-minded opportunists. It was an arduous and lengthy process for smaller retailers to establish themselves, unless they held significant influence or connections.

These people who undermined the initial wave of corporate shops are desperate to regain entry before interstate markets open up. They recognize this as their next prime opportunity to latch onto someone else’s value. We must not permit the worst offenders to jeopardize the national rollout. 

City councils played a role in enabling these unscrupulous individuals to thrive while everyone else suffered, lining their own pockets. Consider the immense financial losses incurred by L.A. Equity Program applicants over the years, following the rules set by a city council that was only revealed to be racist through a secret recording. Politicians throughout the state have also contributed to the headaches faced by the cannabis industry. As the market stabilizes and normalizes, it is crucial that these individuals are held accountable indefinitely and prevented from rebranding. Once we forget that they were never on our side to begin with, we may inadvertently allow them to alter the rules.

As for the underground market, the rebranding problem is mostly just people renaming weed. It’s still shady, but less devastating. 

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