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Sean MorseDr. GuenzelENC 1102- 0014April 21, 2014Medical Marijuana, a Corporate Nightmare or an Entrepreneur’s Dream?“Pot” was originally a term used to describe an illegal substance that was being used by a large portion of the nation and causing widespread criminal chaos. Now, the nickname for a once “explicit” drug is being accompanied by a new term, legal. On December 1, 2013 the state of Washington opened up its’ market to a new product, which is now being accepted and revered by two states. Marijuana shops and vendors sprung up across the state. Soon after the state of Colorado followed and on January 1, 2014, they legalized the sale of marijuana for recreational use. So far only two states have legalized the drug, but rest of the nation is soon to follow. Thirteen states currently have the legalization of medical marijuana on their ballots and seven out of those thirteen are currently considering adding the legalization of marijuana for recreational use to their ballots. The common debate in the nation is about the health risks of marijuana, but there’s another argument stirring, one that can effect the tide of the nation. The new question has emerged, “what effects will the legalization of marijuana have on the business community?” The business community will be affected most by the legalization of the drug, due to the fact that they are given the underlying responsibility to market, sell, produce and distribute the drug. This question has caused a three- way split within the business realm, as educated bloggers, analysts, and reporters argue their perspectives on the effects of the legalization of marijuana. The three main perspectives include those who support the legalization of marijuana and feel it will be extremely successful, the market will sky rocket, and it will bring the economy out of the slumps. Then there are those who believe the drug’s effects are being over exaggerated and the drug should remain illegal because it will not succeed long term. The final perspective of this argument, includes those who have minimal involvement, or are “undecided” on the issue because they don’t know whether to have faith in the drug or not they feel as if the drug can go either way. The Supporters of The Legalization of MarijuanaTo begin with, the supporters of the legalization of the drug believe that this drug will change the tides of the business community. Leading to market expansion, new jobs, and insurmountable profits for stockholders and shareholders. Certain states, Florida in particular, that don’t have the drug legalized yet are hoping and preparing because they believe the benefits of this drug on the market are insurmountable. “Jobs will be created. New businesses will be born. All as we help people live better lives and make the world a better place. With laws changing and opportunities growing rapidly, I can’t think of a better business to be in, or a better time to be in it, than this one right now,” said Thomas Quigley, Founder & CEO Florida Cannabis Coalition. Florida has not even legalized medical marijuana yet and some are already preparing for it to enter the market with Colorado and Washington. So far Florida only has medical marijuana legalization on its’ ballets however, they are reconsidering adding recreational use as well due to the short-term success of both legalized states. In an article entitled “If medical marijuana is legalized in Florida, workers will see more benefits than employees,” Drew Dixon, a business analyst for Huffington Post, analyzes the benefits of marijuana legalization on the work force. Dixon believes the work force advantages are easy too read and clear. Drew Dixon also describes how the legalization of the drug for medical use could possibly lead to astonishing economic benefits in his article, “Economic Impact of Medical Marijuana in Florida an Open Question.” “Based on what we’ve seen in other states and adjusted for Florida’s population, we project that a medical industry regulated in a similar way to Colorado [before all adult use was legalized] could do $600 million in sales in a year,” Taylor West, deputy director of the National Cannabis Industry, said. The continuing short- term success of the two legalized states has brought many possible future states into recognition, but narrowing down on the current effects of the drug, rather then the possible future effects is important. Moreover, the ongoing financial benefits of the drug have opened up the market to new things and expanded it into other markets as well. Colorado businesses have released countless reports of the drugs benefits on the business world, in one report from Mark Mooney of the Huffington Post; they give a number that would mind-boggle anyone. “Colorado dispensaries certainly felt supported in January, the first month of retail marijuana, when the shops generated about?$14 million in sales,” explained Matt Ferner, a leading editor in the “marijuana movement” of the Huffington Post. Since the drug’s popularity is substantial and growing in Colorado and Washington, the market has created many more “revenue- generating spinoff industries.” The city of Amsterdam, which has legalized recreational use of marijuana over 5 years ago, for instance, describes effects of the drug in their city and how it would statistical translate to the US. “The city of Amsterdam, with a million people, boasts 300 coffee houses retailing cannabis. Translated to the U.S, this would amount to over 60,000 retailers and 100,000 jobs, said Dr. Dale Gieringer, a leading analyst for Huffington Post. He uses facts and statistics to describe the current market for the drug in certain places, and the market potential of it in the US. Through his research he describes how the legalization will bring thousands of new jobs, insurmountable profits, and a new prosperous nation. The Opposition The other side of this controversial topic can be referred to as the “Anti- legalization” side, they believe that the effects of the drug on the business community are over exaggerated and will soon fail or drop out of the market due to various causes. One of the most important aspects of the business world is the stock market, the purchase and sale of stocks is what gives companies the financial edge and stability they need. The “anti- legalization” side believes that the medical marijuana stocks will soon fail. “The astronomical stock prices leave them doomed for failure,” spoke Nickey Friedman of the MotleyFool blog network. Nickey Friedman is a former employee of the Bache & Co. stockbrokerage; she wrote an argumentative essay describing the future downfall of marijuana stocks. Not only does she believe the “astronomical” prices will cause the failure of the stocks, she also believes that three main reasons the stocks will fail is because the drug is too generic, there’s no established companies, and there’s already sky- high valuations. “All of them are up huge with few realistic prospects for the future to justify their market caps in an industry already getting saturated with competition before it's even officially born” (Friedman). Friedman believes that these companies are already establishing values for their stocks before the market is even fully established. Though stocks are important to the business community, the legalization recreational marijuana poses a threat for current medical marijuana distributors in Seattle. Furthermore, one overlooked aspect in the debate to legalize marijuana for recreational use is that it will put many medical distributors out of business. The use of marijuana for medicinal use is currently legal in 20 states, 2 of those states have just legalized the drug for recreation use. Kirk Johnson of the New York Times said in one of his recent articles discussing the issue, “In Seattle alone, about 200 dispensaries will have to close, replaced by 21 licensed retailers, and under current state regulations, employees in those shops will not be allowed to even discuss the medical value of the products for sale.” The new market and regulations for recreational marijuana will force medical dispensaries out of business. This eliminates an entire segment from the business community and along with it jobs and exuberant profits. Tony Nittie, analyst for World Resources Institute, writes in his article, “ Understanding the Impact of Legalized Recreational Marijuana on State Tax Revenue,” about how the costs, tax, and regulations of the drug will make it hard for businesses to meet their recently predicted profits. Many of the current vendors believe that the value of this drug for recreational use is being over exaggerated due to the reality that this drug will have to be highly taxed to even make it on the market. “As a result, the report ultimately concludes that the $130 million in tax revenue to be raised in 2014 from pot sales?may not even cover the budgetary costs of legalizing recreational marijuana” (Nitti 2). With that being said, it’s believed and predicted that recreational marijuana profits will not succeed long-term and the market will fall shortly after it rises. The Undecided The final perspective of this argument is that of those in the business community who don’t know whether the drug should be legalized (or not). This perspective is shared by a significant portion of the business community. “Over 30% of the business community remains absent from the voting process because they believe it’s too soon to make a formal decision,” said Aubri Adams from The Independent Voter’s Network. Since this is a consumer product and very new, a significant percentage of people in the business world still don’t have an opinion about it. These people include big time drug companies that aren’t sure whether the product will sky rocket or plummet. Some want to invest, some don’t they just aren’t educated enough in the issue to even have a say, let alone vote on the legalization. Speaking with?Times?columnist Patt Morrison, UCLA professor and former Washington State “Pot Czar” Mark Kleiman stated in 2013,?“I keep saying we don’t know nearly as much about cannabis as Pillsbury knows about brownie mix.” In order to really care about something and join one side of a two- sided argument in business you have to know your product and you have to know what it can do and what it has done. “This drug was just legalized in two states, we only have records of only a few months of sales, I can’t tell whether we as a company should adopt it or not. So for now, we remain as watchers and learners” (Kleiman). Their information is limited and scarce, they may not have access to top sales databases or don’t trust well respected blogs and news sites, either way they are currently unaffected by the legalizations affects and will remain off the ballots. Those with this perspective on the issue will eventually over time join one of the two sides, just right now, since it’s so new they admit they can’t make an educated and supportive claim about the future of the product, all they can say is “we’re unsure” (Kleiman). This audience can possibly become, the early majority. This is the segment in the diffusion of innovation model of marketing, usually customers, but in this case they are businesses and sellers, that wait to adopt or avoid a new product until it’s gone through the innovators and early adopters stages. “In exchange for being an early adopter, and thus being exposed to the problems, risks, and annoyances common to early-stage product testing and deployment, the lighthouse customer is sometimes given especially attentive vendor assistance and support, even to the point of having personnel at the customer's work site to assist with implementation” (Early Adopter). All in all, this perspective on this argument can be referred to as the “undecided,” they stress the fact that this drug is new to the public and they will “go with the flow” (Adams). They have little education, and experience on the product so they will standby and wait to decide, after careful observation, if the drug is going to be beneficial to the market or a complete disaster. Sam Kamin is a leading author in the “Slate” which is a Colorado news station, he discusses these benefits of the drug in his article entitled, “How lucrative is it to be one of Colorado’s legal marijuana dealers?” “With no new competition, product already in hand (dispensaries getting into the recreational market are allowed to use some or all of their medical crop for recreational sales), and the staggering demand created by marijuana still being illegal everywhere else, Colorado dispensary owners appear to be sitting on a gold mine” (Kamin). The market is believed to flourish and bring prosperity to those who own a piece of it, but many critic’s argue that the new drug is being over exaggerated by those in the community. There are countless sources and facts supporting the legalization of the drug for medical and recreational use. The sources are reliable and factual, including the ideas of educated professionals, corporate CEOs, and news reporters. A few of the articles are biased, but this is only natural in a two- sided argument about such a debated topic. Regardless of the minuscule biased remarks the support for this side of the argument is sufficient to argue and educated point. Those who believe the effects of the drug on the business world are being over exaggerated, the stocks will soon fail, and the high tax will not amount to the cost and regulation of the drug hold the other side of the argument. “The so-called market size for medical marijuana being touted about is a mirage because it's not based on the inevitable imploding prices and margins that come with heavy generic competition” (Friedman). Anti- supporters believe the drug is too “generic” and not established enough to live up to its’ “astronomical revenue.” All in all, the claims and support for this opposing side of the argument are just as biased and credible as the other side; one difference would have to be the emotions and intensity of some of the writers in these sources. Biased or not, these sources are sufficient and do indeed support multiple points of this side of the argument, the “anti- legalization” side. Most of the writers for this side of the argument are bloggers, educated personal, and news reporters; they take an aggressive and sarcastic stand on this argument, accompanied by a condescending, authoritative tone. And then there are those who are undecided and are unaffected currently by the legalization of marijuana. On this side are the drug companies and independent business owners playing it safe, and staying out of the current debate. They know little of the drugs potential, but they believe it can go either way. Most of the sources for this perspective come from articles or educated bog networks. They take a relaxed tone and don’t really offer much personal insight on the issue they just keep stressing how the possibility of them entering the market all depends on the success of the next few months. They have no opinion on the future of the drug, they are neutral, the facts they include prove the drug can go north or south, so they want to play it “cool” and protect what business assets they currently have. So as of now, they believe they are unaffected by the drug and will wait and watch to see if the market skyrockets or plummets. In conclusion, this is a well-debated argument with great points on each side. To be undecided is to na?ve when it comes to the business world, you have to be ready to act because the market is constantly changing. With that being said, I totally rule out the perspective of the “undecided” because unlike them I believe I have done more than enough research on the topic and can confidently choose and support a perspective. I agree with Nitti when he discusses how the regulation, production, marketing and taxation will be incapable of meeting the high-predicted profits that companies have discussed. With that being said, I do concur with Kamin who discusses how the Colorado dispensaries are sitting on a “gold mine” because of the high demand of the drug. Another aspect of the “supporting” side of the argument that I favor is Gierenger’s point that the legalization of recreational marijuana will open up thousands of jobs expanding the market and bringing the economy one more step out of debt. That is one fact that can be proven, but one thing that can’t is whether the market will survive long enough to be sustainable for sufficient full- time jobs. Like Friedman, many researchers and analyst believe that although the short-term effects look exceptional, the long-term effects are far from beneficial. “Sorry, folks, but there's no such thing as a free lunch (even if you have the munchies). Just like the Internet in the 1990s, marijuana companies and stocks will not break the basic laws of economics. Their astronomical stock prices leave them doomed for failure” (Friedman). On that note, I’d agree with those who do not support the legalization due to the simple fact that there are no facts to prove the market will last long term. In order to create a sustainable market, it must be long term in order to appeal to every aspect of the business community. I believe that people are investing too much money into the possible future of this drug, that can’t be determined at this time. Since this is a new product on the market, businesses should slow it down and remain out of the market because this drug will most likely fail in the long run. I stand strong with “the opposition” saying that this drug will not last, it’s been proven time and time again that products rise and fall with demand, demand for this drug will begin to fall because market dilution with such a popular product and no in depth patents is inevitable. Works Cited"Economic Impact of Medical Marijuana in Florida an Open Question."?Members.. N.p., n.d. Web. 31 Mar. 2014."Early Adopter."?Wikipedia. Wikimedia Foundation, 04 Oct. 2014. Web. 15 Apr. 2014.Ferner, Matt. "Coloradans Even Happier About Legal Weed After A Few Months Of Retail Sales."?The Huffington Post. , 19 Mar. 2014. Web. 30 Mar. 2014."Florida Businesses Gear Up for Medical Marijuana Legalization: Cannabis Industry Event Hits Tampa April 26th."?PRWeb. N.p., n.d. Web. 31 Mar. 2014.Friedman, Nickey. "3 Reasons Medical Marijuana Stocks Are Doomed for Failure."?TheMotleyFool. N.p., n.d. Web. 26 Mar. 2014."If Medical Marijuana Is Legalized in Florida, Workers Will See More Benefits than Employers."?Members.. N.p., n.d. Web. 31 Mar. 2014.Johnson, Kirk. "Providers of Medical Marijuana Face New Fears."?The New York Times. The New York Times, 06 Mar. 2014. Web. 31 Mar. 2014.Kleiman, Mark, and Paul Armentano. "The Lie That Won’t Die: “We Don’t Know Enough about Marijuana!”."?Saloncom RSS. Salon, Inc., n.d. Web. 15 Apr. 2014.Nitti, Tony. "Understanding The Impact Of Legalized Recreational Marijuana On State Tax Revenue."?Forbes. Forbes Magazine, 24 Sept. 2013. Web. 31 Mar. 2014." - Working to Reform Marijuana Laws."?Revenues From Legalization. N.p., n.d. Web. 29 Mar. 2014."The Five States Most Likely To Legalize Marijuana Next."?IVNus. IVNus, Inc., n.d. Web. 15 Apr. 2014."Who Makes More Money: Colorado's Legal Weed Dealers or Its Illegal Ones?"?Slate Magazine. N.p., n.d. Web. 28 Mar. 2014. ................
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