Editors’ Note: This is the transcript version of the podcast. Please note that due to time and audio constraints, transcription may not be perfect. We encourage you to listen to the podcast, embedded below if you need any clarification. We hope you enjoy!
This week we are joined by Kim Stuck Founder and CEO of Allay Consulting to discuss
- What is the difference between being certified and compliant
- Number # 1 reason Cannabis operators are likely to fail
- Do you need EuGMP & how to be ready for federal legalization
- And so much more
With offices in Colorado and Oregon, Allay Consulting guides companies through the hazards of the budding cannabis and psilocybin industries by navigating compliance pitfalls, ensuring best practices, and ultimately making sure the product you create ends up in stores, and not disposed of. With expertise from seed to sale including: FDA, cGMP, OSHA, ISO, Fire and licensing. Allay understands that every facility has different needs, must comply with different regulations and has their own unique identity. As the rules and standards of the industry continue to evolve, Allay Cannabis Consulting can save you from the headache of trying to keep up, enabling you to focus on the bigger picture.
This show is presented to by 8th Revolution:
At Eighth Revolution (8th Rev) we provide services from capital to cannabinoid and everything in between in regard to the hemp & cannabis industry. Our forward-thinking team can diagnose, analyze & optimize every detailed nuance of your company to keep your business safe, smart, and profitable. Our flexibility and experience combined with ongoing research create unique insights into how to best grow your market share. Contact us directly at [email protected]
Bryan Fields: @bryanfields24
Kellan Finney: @Kellan_Finney
[00:00:00]Bryan: What’s up guys. Welcome back to another episode of the dime I’m Brian Fields. And with me as always is Kellen Finney. And this week we’ve got a very special guest Kim stuck of a lay consulting, Kim, thanks for taking the time. How you doing?
[00:00:15]Kim: Doing good. Thank you so much for having me side diving, Kellen,
[00:00:18]Bryan: how are you
[00:00:18]Kellan: doing?
[00:00:19] I’m doing really well. I’m excited to have another Colorado person holding down the west coast. You’re going to have to represent the east coast over there.
[00:00:27]Bryan: Brian. That’s fine. I, I guess we’re just going to skip right through that and not ask him to declare where she’s located. So, Kim, I guess from an east west coast standpoint, you’d align yourself more with.
[00:00:36]Kim: Yeah. I mean, we have two locations, so we have one in Denver, Colorado, and then one in Portland, Oregon, I’m actually in the port. Well, this is my house. Cause it’s, you know, COVID world now, but this is where I live and work from. Um, but we do work on the east coast. We have a lot of clients out in New York, New Jersey, uh, Michigan, Florida.
[00:00:55] I mean, we’re all over the place. So we will work in all 50 states, including, um, even Canada, [00:01:00] Mexico, where we have clients in Israel, South Africa. It’s pretty crazy how it’s widespread.
[00:01:05]Bryan: Yeah, let’s go. Let’s go back to the origin of you. So take us through your background and how you got into the Kennedy.
[00:01:12]Kim: Yeah. So, um, I actually started as a regulator, so I, I started working for government. I was actually a restaurant and wholesale food, uh, like manufacturing, health department, person, and inspector. Uh, it was, they have like different titles for all of it. Um, but I was a public health investigator was the actual title.
[00:01:31] And, uh, it was in the, in the city of Denver, uh, was my jurisdiction. And so it was really interesting because in 2014, cannabis came as adult use came online. And everybody just kind of looked at each other and was like, okay, they’re making, you know, all kinds of edibles and tinctures and capsules and vapes.
[00:01:49] This needs to be regulated for health and safety. And so they kind of just were like, who wants to do it? And I was the one that was like, I want to do it. I want to do something different and interesting. And [00:02:00] so they were like, okay, become the cannabis specialist. And so that’s what I did. Um, and I did that for a little over three years until I started my firm LA consulting.
[00:02:09] Um, in 2017, I just really. Realized, you know, I got a huge education from the industry, right? I’m going into thousands of facilities, licensing them, learning all about their processes and those kinds of things. And. Yeah, it was, it was kind of eyeopening. How many people did not understand how to read regulations, didn’t understand how to, you know, realize what they were actually looking for.
[00:02:33] Um, and they also didn’t really know anything about health and safety. So it was very, you know, basic food safety, having enough hand sinks in the facility, washing their hands regularly, wearing PPE, like things that in other industries is kind of like commonplace. Um, weren’t existing in cannabis. So, um, a lot of people were getting fired.
[00:02:52] Products being thrown out because of all kinds of health and safety issues. Um, I’m sure we all remember the press releases and the bulletins that were [00:03:00] going out back in like 20, 15, 20 16. That was mostly me. Um, unfortunately, and so I, I was like, I love this industry. I love these people. I got to do something different.
[00:03:10] This is not working for me. I, you know, like I want to help them. And as a regulator, you really can’t help them. You’re not allowed to give them advice. You’re not allowed to like, show them the answers, you just state the regulation and they got to figure it out. So, um, I became. And for awhile, it was just going to be me by myself doing something that I loved just to pay bills and, um, make it work.
[00:03:31] And then I got super busy, uh, overnight pretty much. And so I ended up having to hire like a year later, um, and then hired again and hired again and hired again. So now here we are. Um, and we’ve, we are in all kinds of states and doing all kinds of good things. We mainly focus on worker safety. Um, and consumer safety.
[00:03:52] So we really deal with like FDA and OSHA. The most, we specialize in GMP certification, ISO 9,001. I [00:04:00] said 22,000 certification, organic certification and gap and GAC P, which is like good agricultural practices and the cultivations now, um, for a long time, those certifications weren’t even granted to people in the cannabis industry.
[00:04:14] And that now, thankfully is not the case. We work with a lot of accredited certifying bodies. How companies. It’s awesome. I love what
[00:04:21]Bryan: I do. So I’m glad you shared all that and I’m looking forward to diving some of those specifics, but before we do that, I want to kind of stay in the, in the past. Right. Was there any hesitation to kind of come into the cannabis industry and even more so when you first got started, Has the conversation shifted from when you first got in with some of the operators and how their, their feelings are you towards your, you know, your recommendations and the certifications and the needs of that to where we are now, where it’s kind of a little more, I guess, above board and an expected of what the, what is the future.
[00:04:50]Kim: Yeah. So, uh, yeah, I was terrified to get into the industry. I, in fact real, oh my gosh. Well, first of all, my family is very conservative. They just about fell out of their [00:05:00] chairs. When I told them I was going to start a cannabis company. Um, and you know, I had support, but it was very like, well, we’ll see how that goes.
[00:05:07] Um, and so I joined, I did it anyway and was just like, you know, you gotta, you only live once. Let’s do it. And, um, I remember going to my first cannabis happy hour. As a non regulator. And that was very eyeopening. Uh, people hated me. People called me the weed Wacker to my face, uh, and were like, what is she doing here?
[00:05:27] And it took them a little while, even like my first audit that I did, they still thought I was a regulator when I came in and they like, wouldn’t let me in. And I’m like, no, no, no, your boss is paying me to be here. Like I swear, call him, you know, uh, it took a little while for people to come around and realize that I wasn’t.
[00:05:44] You know, and that I wasn’t gonna do anything to them that would, you know, they weren’t going to want, uh, and that I was going to be around and actually helps them and actually work through problems with them. And once that kind of dawned on people, then it became an, a completely different conversation.
[00:05:58] Um, and yes, [00:06:00] from the beginning of. Uh, to now that conversation has changed a lot, but it kind of depends on what state I’m in. Um, different states are at different points, right? Like in Oregon and Colorado people know who I am. They, they, they know that they need me in a way, like, they’re like, no, That’s important.
[00:06:19] We should have her come in and do an audit or, you know, let’s go ahead. This we’re going for this goal, but in states like Oklahoma, or, you know, like Virginia, like the states that don’t, they’re brand new, so they don’t really know what they need right now. They’re just trying to get licensing done and make sure that they have, you know, the basic SOP instead of looking at that like higher level.
[00:06:40] Cause obviously we help with state regulatory compliance as well, but that’s just the easiest. Regulations we work with, right. So it’s like, okay, we’ll get you sound on your state regulations. And then what do you want to do? You know, what do you, where do you see your company in five to 10 years? You know, what type of risk mitigation do you want to put in place?
[00:06:58] So you’re not going through [00:07:00] recalls and bulletins and having your note, your name slandered and. Crazy stuff. Um, and it happens, it happens to everybody. I mean, even huge companies we just had, I, you know, purely, I think was one that just went through a whole thing and I mean, there’s just, it happens to everybody.
[00:07:15] So being prepared is really what we’re trying to do is like, Hey, let’s be proactive instead of reactive so that when bad things happen, because it’s going to happen, stuff happens. Um, we just need to know how to handle it. If that means. It
[00:07:30]Kellan: does. Um, and I want to take the conversation towards CGMP because I think it’s probably the most popular buzz word thrown around the industry these days.
[00:07:37] Right. Um, everyone talks about the acronym. I don’t think the majority of people really understand what it means, but CGMP is like an existing situation, right? Like our food. It’s manufactured under CGMP. Our medicine has manufactured under CGMP, but they’re, they’re different. Right. And so could you kind of expand on like the differences within the CGMP world and which [00:08:00] one cannabis companies kind of need to address and kind of take
[00:08:03]Kim: on?
[00:08:04] Yeah. So the term CGMP means current good manufacturing practices practice. So if you have GMPs in your facility, that could mean that you wash your hands regularly, like, like honestly, Uh, GMP is just like one thing in like a many, many thing process. But the difference is, is so there’s FDA GMPs, right?
[00:08:27] Those are the FDA regulations because the FDA isn’t involved in our industry, including the CBD side, because they haven’t put out regulations yet. Um, They, you know, and they’re telling us we’re not supplements that we’re not food ingredients. So what do we fall under? That’s a really great question. The next best thing to being regulated by the FDA or regulated by your local health department or whatever, following those sea GMPs, um, is to be GMP certified.
[00:08:53] And so when people kind of throw it around, they’re like, oh, we’re GMP, you know, uh, compliance. That literally [00:09:00] means nothing. Uh, they’re like, there’s no test standard for that. There’s no, like, usually when people walk into a facility and they look around and it looks clean, they think, oh, it’s clean. No, no, no.
[00:09:11] Like as CGMP compliance is like very, very detailed oriented. You document everything. You have to have regular trainings and all this crazy stuff. Um, and, but being G GMP certified from an accredited certifying body That’s a whole other level. That means you can prove it. Right. I have a certificate. They come in every year and audit me.
[00:09:34] This is me proving to you that I have a safe product. And that is really what my clients want because they can sell their products for more. They can sell their company for more eventually. And the risk mitigation, right? So they don’t go through recalls. They don’t go on bulletins. They’re not shamed in the media for poisoning people.
[00:09:52] Um, and that’s a good thing, right? That risk mitigation. Also all of our investors that we work for, we do a lot of compliance, due diligence for [00:10:00] investors and financial firms. They won’t even give you anything. If you don’t have GMP certification, like it’s starting to become that way. And that’s the exact same.
[00:10:10] As wholesale food manufacturing is like anything that you buy in whole foods or, or, you know, like king Soopers or anywhere. They they’re all GMP certified. It’s kind of an industry born standard that they’re like, okay, you have to get a certification from an accredited certifying body, or you’re just not going to have a business cause nobody will buy your stuff from you.
[00:10:30] And that is just the way that wholesale food right. Is regulated kind of within its own self. And that is the trend that I’m seeing. And then you have. Like Florida, who you have to have GMP certification from a third party in order to even have a license in the THC industry. So that is another trend that we are seeing in a lot of states.
[00:10:49] And I think that that’s going to be the case, um, in Virginia, I think that’s going to be the case in New York because in New York, the CBD industry, if you’re a CBD manufacturing company making [00:11:00] edibles or whatever, um, you have to have GMP as well. So it’s not something that. Crazy, but it takes a lot of time.
[00:11:08] It’s not something that happens overnight and it takes a lot of effort, ongoing effort for years and years to like keep it. So I think people are a little shocked when they realize that unfortunately,
[00:11:21]Bryan: whoa,
[00:11:21] what percentage of operators are certified and what percentage are compliant?
[00:11:27]Kim: Zero, are compliant even if they say they are, I can’t even tell you how many times.
[00:11:31] They’ll pay for a gap analysis to GMP and they go, oh, we’re compliant with it. We just want to like make sure before we call the certifying body every single time they have at least like four months left of work, to be able to be certified, it is not. easy And it’s really, really hard to do in house. Um, unless you’re hiring someone who like used to work for the FDA or something like that, and those people are very expensive.
[00:11:57] So I, you know, I don’t recommend it, [00:12:00] uh, but you know, if you can go for it, um, yeah, it, it just takes a lot of time in house, a lot of effort. And a lot of times reading the regulations, just like every set of regulations. It’s total jargon, right? If you’re not a professor, a certified professional of food safety, you don’t know what half the words in the document even mean.
[00:12:19] Um, and it’s, it’s very confusing on purpose, I think. Um, unfortunately, but it’s really hard for people to understand and, and get through it without at least a little bit of.
[00:12:29]Bryan: I think that’s really well said, cause we’ve looked through it a little bit. And one of the points we were looking at, neither of us were sure of exactly what it was asking.
[00:12:36] So at the end of it, like, we weren’t even sure where to look. And I think like what you just shared is so important too, because if you put any announced person on that, not only are they going to face probably other internal challenges right. Of like their normal day job and kind of dealing with all those other conflicts, they’re not sure how to kind of navigate some of those unknown.
[00:12:54] To come back to you. Can, what is the number one reason someone would fail or what’s the biggest missing [00:13:00] piece you see in the industry today for failing those compliance or.
[00:13:04]Kim: Oh man. Uh, there’s a lot, there’s, there’s literally so many ways, um, that you won’t pass. Um, but the, the number one ways, and this is at least with the system that my companies put in place, um, and we’ve been doing it for a long time, so it’s literally a very systematic, we break it down like month to month.
[00:13:24] It’s really great. It works really well. Number one reason is physical facility issues. So. People will have all, maybe have all the documentation and all the training and all the logs and all the calibrations and metal detection and blah, blah, blah, blah, blah. But let’s say they don’t have enough hand sinks in their facility or their floor has like chips in it or their ceiling.
[00:13:47] It has like a. Tiles, which is not allowed. Um, there’s a lot of issues with the physical facility that need to be identified right away. In fact, that’s our first step in our entire process is to [00:14:00] do a gap analysis, see the facility itself and find those things that need to be fixed right away, because those are your most expensive.
[00:14:07] If you have to redo plumbing in your facility, you need to know that like immediately. So you can get a budget together and a timeline for that because that’s the most expensive. If we get to the end of the process and then we have to go back and do the floor or the plumbing or something like that, it’s going to cost them an arm and a leg and really push that out.
[00:14:26] Um, and so we try to do that right upfront. Um, the second thing is not having proper documentation. This happens a lot. People will buy. I can’t even tell you how many times we will start working with a client and they’ve bought, they spent 50 grand. On SLPs online that are GMP compliant and they have this packet and they just give it to us and they say, okay, review this.
[00:14:51] And it’s awful. Right? It’s they have, none of the processes are unique to their facility. None of the trainings are [00:15:00] legitimate for what they’re doing in their facility. I mean, it’s just kind of amazing that people are still buying online templates. Like just don’t do it. Just don’t do it. Um, and it, you know, and our company, we write all of that.
[00:15:14] We, our templates go to you if you’re a client, obviously, and we write them for you specific to your facility, if there is anything that’s happening in your SOP, that is not happening in your facility, that is a violation. And that can be a really huge violation. If you’re talking about. Uh, asset plan or, you know, something that can really affect public health.
[00:15:35] So those are really like the two things and then training. We there’s a lot of training issue. People, people think that they’re doing training and then they’re not doing enough for, it’s not, you know, sinking in, um, because that training is good. Cause they interview the auditor, interviews each person in the facility during the.
[00:15:54] So it’s not just one person answering questions and I think they’re not ready for that. So if you’re not training your entire [00:16:00] staff, then if they answer something wrong incorrectly, um, then that’s a violation as well. Um, and it is a point system. So if you lose too many points, you don’t get that certification.
[00:16:12] Um, and you have to pay them again for another audit. So if you fail that first one, it’s, you know, it’s a lot of money. Cause sometimes they’re like $20,000, depending on which accredited certifying body you use. There are some that are much less than that, but it’s, uh, yeah, it can be very costly if you screw it up.
[00:16:29] So, you know, I hope that was a good answer. Long
[00:16:35]Bryan: answer. Yeah. I can only imagine you’ve probably saw some SLPs and you’re like, that’s actually not your company’s name. I can’t imagine that this is your SOP. And they’re like, what are you talking about? And you’re like, that’s not the name of your facility and boom right away.
[00:16:47] Probably a big red flag. So is it mandatory though, for a lot of people in the space, like, what you’re saying now is like there’s costs for, let’s say for your team to come in and help. And then additionally, you’re pointing out problems. Let’s say with the plumbing, with the flooring, with the. [00:17:00] Those are additional costs.
[00:17:02] So from a mandatory standpoint, is this something that operators need to do now or something they should be doing now?
[00:17:08]Kim: So in most states it’s not required yet. Right? So no, this is definitely above and beyond thing. Um, but what we’ve learned from our clients, uh, you know, just being in it for so long, it was eventually everybody’s going to need to be at the standard and it’s starting to spread, especially with federal legalization on the horizon.
[00:17:28] Um, I think the way that the FDA might spin this is the way the other states are spinning this. It takes a whole lot of work off of their plate. If they just require this across the board to go through a third party. Um, that’s exactly what Florida was doing. They were like, are we don’t have the bandwidth to regulate all of these new companies.
[00:17:51] Okay. A lot of companies, right? They just, I mean, look at Oklahoma 14,000 companies overnight that the health department now has to go regulate. [00:18:00] Absolutely not. It’s not going to happen. Um, and that’s just the way it is. Right. They don’t have enough people. They don’t have anybody trained in cannabis. So requiring just like, Hey, you have to have this certification.
[00:18:10] And that’s, it. That’s really easy for them. Um, and that could be the way that they’re going to go. And not only that, if you’re GMP certified, let’s say the FDA does. Start regulating the way that they’re regulating everybody else. If you’re GMP certified, you will pass an FDA audit a hundred percent like without a doubt.
[00:18:27] And in fact, it’s a little more above and beyond then the FDA. Regulations and they’re based on those regulations. So it’s kind of a, one of those, Hey, helping my clients sleep better at night. If you have this, you’re not going to have to worry about it. You’re not going to go through recalls. I mean, if you do, you figure it out really quick, uh, right.
[00:18:45] You catch it usually before it goes out the door is the goal. Um, if something goes wrong because of GMP. Uh, and yeah, like I said, it’s, it’s a huge risk mitigator, you know, you know, your products safe, you know, That, uh, [00:19:00] also, you know, companies that buy other companies are always looking for that kind of thing.
[00:19:04] Investors, if you’re looking for investors, if you have a letter from a company like mine that says, Hey, you’re working with us for this goal, investors go, oh, oh really? You know, like awesome. Maybe I should, you know, and it just really puts you above and beyond. Also as a consumer myself, I look for that GMP certification that only ride products from those companies, because I know that they’re the safest ones on the market and because of the spotty regulatory oversight, when it comes to health and safety throughout the entire United States right now, you know, I can’t really trust everything, unfortunately.
[00:19:39] So.
[00:19:41]Kellan: Yeah, I, I completely agree. So say, we’re say I’m a new company and I’m looking to start the company and get a CGMP certification from the get go and like design facility with that in mind. How long would I kind of expect the process to take from. Um, starting it to [00:20:00] actually getting the piece of paper I can frame and put on my wall.
[00:20:02]Kim: Yeah. So, I mean, it really depends on their budget. So we work on retainer. So we have companies that have been with us for like two years and they’ve been working at it like five hours a month, you know, they just, you know, they don’t have a deadline. It’s not a big deal. They want to get it, but they just don’t have the budget to just like, get it done.
[00:20:19] Um, and that happens. And then we have other clients that are like, we want it in four months and we’re like, okay. How much money you got because that’s going to be expensive. Right. Um, and then they have like a 40 hour a month contract and then they’re done in four months. So it really just kind of depends.
[00:20:34] Um, 90% of our clients who do GMP particularly, or specifically are also sometimes going for ISO 9,001 as well, which will add a little bit of time, but not much, maybe like 20 hours between the two of them. Are there quite a bit. Yeah. If you have, like I said, if you get GMP ISO 9,001, like stacks right on top of it, and it’s just like 25 more hours, I think, to, to add that.
[00:20:59] So a lot of people are [00:21:00] like, yeah, let’s just do it. Um, and if you have a certifying body that does both, it’s one on. And it cuts, it costs you less money. You don’t have to pay for two separate audits. So anyways, yeah, it’s exciting. But anyway, I’m like, I get excited about it.
[00:21:19] such a nerd. Um, but yeah, so it’s really depends on the client and what their needs are. Right. Um, but most of our clients are at 20 hours a month because then we’re getting through like 1, 2, 3 SLPs every single month. We’re doing a training every single month via zoom for their entire staff. Um, and we just kind of get through it.
[00:21:39] And usually that’ll take about six to eight months depending on what the company has in place, because some companies are starting from complete scratch, where they have a facility that they’re maybe building out right now. We need to do a floor plan review to make sure they have everything that they need to be GMP certified.
[00:21:56] So we save a lot of people money that way during, you know, talking to their [00:22:00] architect, right. All of that. Um, and that’s usually some of our, like very early on clients. That’s what they’re doing is building a facility or retrofitting one that exists. And then from there we would start working on SLPs and training.
[00:22:15] Um, a lot of the SLPs can be kind of general if as long as you know, what’s happening in your facility, we can get those SLPs done. So, um, it, you know, we can start as early as. Hey, I don’t even have a facility yet to, Hey, I’ve been functioning for 10 years and I have no idea what’s going on and I want GMP certification and that happens.
[00:22:34] And you know, with us, the good thing is we’re really flexible. Um, and we can kind of, you know, take roll with the punches. We’ve had clients where, you know, we’re working on something and they call us and they go, ah, OSHA just showed up. Will you get here? Will you help us out with. You know, whatever. And so we kind of can do whatever needs to be done to help our client at that time, and then go back to our regular, okay.
[00:22:58] We’re getting these SLPs [00:23:00] done and we’re putting these in place. So it’s pretty, pretty cool. Pretty exciting. Um, I wake up and never know what my day is going to look like is really what it comes down to.
[00:23:10]Bryan: Are there dual responsibilities, for example, your team’s responsible for some of the training and some of the advice, but internally the operators also are responsible for kind of carrying out their needs.
[00:23:19] Right. And executing on that. So that’s a critical piece of the right. It’s a partnership in the effort towards the surface.
[00:23:25]Kim: Yeah. So we do most of the heavy lifting, right? They don’t have to sit in front of a computer screen and type out hours and hours of SOP. We do that for them. Um, and we’re used to that kind of workload and that kind of thing.
[00:23:38] But when it comes to implementation, obviously the trainings, we started doing trainings every month, we require it. We will not do it without having those trainings because we’ve learned that the implementation part is very difficult without. Education basis. And so when everybody in the, in the company, you know, it’s a cultural change, right.
[00:23:56] It’s changing from that old mentality of this is the way we’ve [00:24:00] always done it to, okay. No, we’re improving what we’re doing and we’re going to take pride in what we’re making. And, and it’s really interesting because. Um, at first we get a little, like fight back sometimes from some employees, but by the end of it, they’re like completely bought in.
[00:24:14] Um, cause we explain the why behind, you know, that’s what regulations don’t do. They don’t, you know, we have microbiology backgrounds and stuff. We can tell them why, like what kind of bacteria is growing in this situation and what it’ll do to you. And when you know, like we can break it down and then. Oh, gosh.
[00:24:32] Okay. Yeah. Yeah. I’ll make sure to sanitize every time, you know, and it’s not like that.
[00:24:38]Bryan: Totally. You didn’t say that.
[00:24:41]Kim: So it’s, it’s good. And you know, and we love doing it, but the implementation. Yes. I mean, obviously we take most of the work, uh, off of their plate. That’s our job. We want to make life easier for them.
[00:24:52] That’s why we’re there. Um, but there is a level we have to have. Um, higher up buy-in if the owner doesn’t give a [00:25:00] shit and doesn’t care, excuse my language. Uh, then neither will any of the other employees and they’re going to struggle really hard to get implementation and to actually get the certification.
[00:25:09] And we’ve definitely entered into some of those contracts where we’re like, okay, we need your buy-in. We need you to be on board because if you’re not, we can’t be working with you because we don’t feel like. Doing any good and we’re wasting our time. Right. You know, we want to make sure, so all of our clients that we’ve gotten certification store that have worked with us for years, you know, they kind of become family.
[00:25:30] All of our clients are just absolutely above and beyond and just like the best in the industry for sure.
[00:25:37]Bryan: Yeah. And I’m sure some of those timeframes where it’s eight months kind of get kicked out to 12 and 13 months when you’re not getting buy-in. When the other side is not kind of contributing their into the deal.
[00:25:45] So let’s do a little scenario. For example, we have a small operator, they can’t afford the certification process now because they just can’t prioritize it. And then all of a sudden, out of nowhere, federal legalization happens. What does the small operator [00:26:00] do? Are they unable to produce product? Are they in a complete standstill until they get their paperwork?
[00:26:04] How,
[00:26:04]Kim: how would you. Well, they should be registering with the FDA already. Um, or at least the first thing that they should do, because once they’re registered with the FDA and they have proper licensing through their local and state health authorities, they should be okay to operate. Um, depending on the state, there might be states that maybe hate cannabis and aren’t going to allow it at all.
[00:26:26] But in states that you’re already functioning, you should be okay. Um, I mean, we all know those states anyway. I digress, but you know, they should be okay. But registering with the FDA, you have to be registered with them, just like every other wholesale food. Every, every restaurant everybody has to do that.
[00:26:43] Um, and yeah, you might have a visit. Um, I would, I mean, unfortunately if you don’t have the budget, even for just an audit, cause sometimes just having that audit, uh, and you can do an FDA audit, right? We, we do that. You can just go in, do the [00:27:00] FDA audit and then you have a report. That’s almost like a checklist of things that you need to get done.
[00:27:04] Also, when the regulator comes in, you can show them. And say, Hey, I had this like audit, we’re trying really hard to get into compliance sometimes that will like, make them feel better about the situation. And maybe not find you quite as much if you are out of compliance. Um, you know, it’s, it’s hard because unfortunately, Anything like this cost money, the GMP certification costs money.
[00:27:28] Um, we try to keep it as minimal as possible and we try to save our CA our clients. Like we went completely virtual because our clients were paying a lot of money for us traveling back and forth all the time, you know? So we gave that option and it’s helped a lot of our clients be able to afford us. You know, we try to do little things, but in the long run, it is hard.
[00:27:45] If you’re a small operator, though, it’s a little easier. Read the regulations, you know? Um, and if you, you know, if you have a 400 person company and you’re trying to do it on your own good luck, but if it’s a five person company, you might actually have a chance, you [00:28:00] know, um, and you can always call your local health department and ask them questions.
[00:28:04] They will answer your questions. Um, I used to all the time when I worked for Denver, when you can actually call your F the FTA. As well, um, they won’t answer your questions right now because they don’t have answers. Um, but when it does become federally legal and I guarantee that there will be a staff that will be taking questions from the industry, because there’s going to be, it won’t only be you, there’s going to be a lot of people that are going to be confused by the regulations and not really know what to do and want to be doing the right thing because you know, every, everybody I know wants to do the right thing, it’s just a matter of knowing how.
[00:28:39] I can imagine
[00:28:40] that,
[00:28:41]Bryan: that they will be a very loud day for you, Kim, when
[00:28:44]Kim: I was scared for that day, I’m telling you this, just turn the phone
[00:28:47]Kellan: off. Yup. How much more complicated is, is it if they’re a small company that’s vertically integrated because
[00:28:54]Bryan: you mentioned gap,
[00:28:56]Kellan: which is what good agricultural practices, right?
[00:28:59] So are they [00:29:00] now, now they’re fighting like, uh, on multiple fronts, if you will, right. To get these certifications.
[00:29:04]Kim: Yeah. Yeah. So a lot of our clients that have gap or GCP, it depends on which certifying body, what they call it. Um, it, you know, they get that and it’s the same kind of thing. It’s a risk mitigation.
[00:29:17] It talks about how to properly do pesticides, how to. Stop, um, cross-contamination issues in a grow. We all know that that’s an issue, right? Walking through your clone room. After being in the powdery mildew room is never a good thing. Um, and, but it happens all the time because you know, facilities are built weird sometimes.
[00:29:36] And. And so, you know, people who want to be vertically vertically integrated, if they want GMP, they almost always want JCP as well. Um, just because it’s stopping contamination issues and food safety issues from the literally the beginning of the process to the end of the process until products out your door.
[00:29:53] Um, and it has a great track and trace, right? So if something does go wrong, you’ll be able to identify it because it’s within your own [00:30:00] facility, the ones that become complicates. Is I bought this flower from somebody else and I can’t, I don’t have eyes on their facility and then it comes to me and I don’t realize there’s an issue with it.
[00:30:11] And then I may concentrate and it has like, you know, uh, a dangerous pesticide in it. And then I’m blaming them. My name is on the recall because I’m the one that has the label on it that went out the door. And so that’s when things become more complicated. So I kind of love the vertically integrated thing.
[00:30:28] I mean, I don’t think it should be like required. People should be able to do and run their business. They want, but if I had a business, I would, I’d probably love that vertical integrated because you control every step of the process. So, um, but I will say that GCP is not one of those things that’s usually required.
[00:30:46] It is. Implemented in a whole lot of agriculture, you know, practices in all kinds of industries. Um, and sometimes if they’re going to buy like their company’s big conglomerates and stuff, if they’re going to buy your corn, you have to have it just because [00:31:00] they require it. If they’re going to buy your corn from you or whatever it may be, and that might eventually happen for the industry.
[00:31:06] Um, but as long as you’re compliant with your local agriculture, Like department, um, and those regulations right now, we haven’t run into a whole lot of issues with the gross, except for pesticide use that isn’t allowed. And I mean, obviously the obvious stuff, right? Yeah.
[00:31:23]Kellan: So in other, in other industries, isn’t it like the vendors have to be CGMP certified as well, too.
[00:31:28] So it’s like a giant network that everyone has these like certified certificate. So they can like play nicely together. Right. That situation you just mentioned where you go acquire some flowers.
[00:31:40]Kim: So if you’re a company that requires everybody to have CGMP or gap or whatever, then yes. But technically it’s not required. So if, yeah, so if I’m buying concentrate or like distill it, like let’s say I’m buying distance. To put into my gummies. They don’t [00:32:00] have to be CGMP certified unless I want them to be, it does.
[00:32:04]Kellan: And like the regular food industry say I was making like cupcakes and I was buying sugar. Does that sugar need to come from a CGMP? So yeah, the real
[00:32:13]Kim: world, I guess. Yes. That’s an industry decided thing. Oh, it’s not a regulated. It’s not required. Okay. Yeah, I know. It’s super weird. But the entire wholesale food industry, they don’t every single person that owns a company.
[00:32:32] They’re just, as I won’t buy, if you don’t have GMP,
[00:32:34]Kellan: they just all got together. And just kind of, it’s like a unwritten rule. It
[00:32:38]Kim: is, it’s a total unwritten rule, but everybody knows it and everybody follows it. Cares, you know, they’re like, yeah, I get it. Cause it is such a risk mitigator. And when you do screw something up and make somebody sick and it’s just going to get more, more and more loud.
[00:32:53] Right. Right. Now, if somebody gets sick in Colorado, you only hear about it in Colorado, if you know, [00:33:00] but once it’s federally legalized, that’s going to be a whole different story. And there are so many people out there with a biased against our industry. They’re going to want to make it loud. And that’s why a lot of health departments are pretty good about.
[00:33:13] Okay, this happened and this was an outbreak. We’re not gonna tell anybody, we’re just, here’s your fine, or this is how we’re going to fix it. We did a recall in your little area that you were selling or, you know, whatever it was and trying not to make it a black eye on the entire industry, but it does happen all the time.
[00:33:30] Um, and when it becomes federally legal, that’s going to be a lot louder. Um, and I think that the people who are against our industry very strongly in some cases are going to be the ones that are shouting. From the rooftop, when things go wrong and trying to make our industry look bad, which is why I’m really commend the people that are getting these kinds of certifications.
[00:33:53] Um, because they’re doing a huge service to the entire industry, right? They’re, they’re preventing things from happening that could [00:34:00] potentially make us all look very, very bad. And it’s, you know, it’s like the story of the woman in UK who ate a THC gummy and died. You know that wasn’t the THC that killed her.
[00:34:11] Let’s just be real. Like it was something in the process of that gummy or, you know, a solvent that that’s a completely illegal market. So it was definitely, you know, in an illegitimate, you know, process. And so it’s just. You know, it’s crazy, but that makes everybody here ago. Oh, I don’t know if these THC companies are safe and it’s like, oh my gosh, no, that’s completely different.
[00:34:36] So anytime we can prevent anything bad from happening like that, the, it serves the industry as a whole. And so that’s why I always commend people. And I shout from the rooftops, like when our clients get a certification, We obviously we’re under very strict into yeas, so we don’t do it unless we have their permission, but we try to shout from the rooftop that they’ve gotten it done.
[00:34:57] We try to get them in articles. We posted all over our [00:35:00] social media pages because they should be recognized for that amazing accomplishment. Cause it is very hard to get it is costly. Um, and they should be celebrated for going out of their way when they don’t even have to, to protect the industry as well.
[00:35:14]Bryan: I think that’s so perfectly said, right? And we’ve seen it with the vape gate, all the challenges that come with the stigmas and the moment there is a miss up, even if it is legacy, legacy enabled. People just freak out. And what happens is you get that stuff, even if it’s overseas, people start to question whether or not this industry has legitimacy, where things are done the right way.
[00:35:34] And the story that came to mind. I know, I don’t think it’s kind of accurate is like the lady and McDonald’s who got like the coffee sport on her. And she sued McDonald’s like sh I mean, lady first off it’s coffee, like what did you think it was it wasn’t ice coffee. It was hot coffee. Um, yeah, like, come on.
[00:35:49] Like no one thought, Hey, maybe McDonald’s is killing people because their food products are bad. Right. Like nobody made those associations. So like maybe we should have more of like a fair thought on it and that, and that’s just [00:36:00] kind of came to mind on that. And it’s, it’s definitely ridiculous, but you’re right.
[00:36:02] Like, those people should be commended for what they’re doing because they are helping the industry by investing in the future of the process. Continuing on that path, EOG, MP to common word we’ve heard around recently. Is it something that’s comparable to CGMP? Can you kind of share a little bit about the two of them?
[00:36:19]Kim: So yeah, this is a huge confusion for a lot of people. I have people would reach out and say, can you get me EU GMP? And I’m like, well, yeah, but why would you want that? Um, EU GMP GMP is for. Um, and it’s pharmaceutical only. So our equivalent of GMP in the United States, which literally it’s the same. It’s exactly the same, um, is the two 11, um, CFR.
[00:36:48] For GMP, which is pharmaceutical. So you can get that in the United States. If you get EU GMP, um, good luck getting your products through customs, uh, or even into another state, because that is like a huge red flag, [00:37:00] because that usually means it’s coming from the EU over. Um, and obviously that would be very illegal if it was a THC product.
[00:37:07] So, um, yes, we do help our clients with E uh, GMP. Two 11 CFR two 11, which is pharmaceutical grade. It is not necessary though at all. Um, I will just preface that, like we do what our clients ask us to do and we will help them with that. It is a huge expense, like, I mean, not. Not just like, oh, it’s like $50,000 and then 5,000, you know, no, it’s like a million bucks and it is because you have to have clean rooms.
[00:37:35] You have to, I mean, the, the entire facility has to be rebuilt essentially. Um, and it it’s very cool. Yes. Uh, you know, not that many people fact, I don’t know anybody that can actually say that they have that two 11 GMP that I know of. Um, but you really, that just makes it so you can use sell it to pharmaceutical companies.
[00:37:55] There aren’t that many pharmaceutical companies, there’s only one, um, that will [00:38:00] buy CBD or THC, and they’ve already got their suppliers. Like they’re there, it doesn’t open up any other doors that isn’t what you need to sell internationally. Um, you can sell into the EU, which is use. So it’s it kind of, it just like doesn’t make sense, but it is this like industry buzzword that everybody can, you do eat you GMP.
[00:38:23] We can, but let me tell you why you shouldn’t, because it actually limits you into who you can sell to and where you can sell. Um, whereas if you just get regular, regular GMP and then maybe ISO 22,000, which is like GMP on crack. That’s what you need to sell internationally. So for most wholesale food manufacturers, if they’re selling into Germany or Spain or whatever, they have ISO 22,000, um, which is similar to GMP, it’s just a higher level GMP with more documentation, more training.
[00:38:56] Um, it’s. Higher level. [00:39:00] Um, and, and that is actually where like the Canadian government is going is requiring that, which is fricking genius, uh, because their country, as you know, uh, is completely federally illegal. And if every single company on in Canada. Has to have those are at those standards that you can sell internet nationally.
[00:39:21] That means when the global market opens up, Canada is going to crush all of us because every single company in Canada will be able to sell international. Which is one of the reasons why I really, really want federal legalization here because we can start setting those standards and doing the same kind of thing and actually make it, you know, we’ll see, it’ll
[00:39:41]Bryan: be okay.
[00:39:42] We had a Canadian guy on and he shared that pretty, pretty loudly that they’re setting up to crush and that if the us doesn’t get their act together, they might not be involved in some of these conversations. And as a world leader, It might be kind of embarrassing to not be sitting at the table, having these types of discussions.
[00:39:59] So [00:40:00] I’m glad you shared light on that and brought that again, because I don’t think that can be heard loudly enough.
[00:40:05]Kim: Seriously. Yeah. It’s sad. We’re going to be left behind. And we were one of the, we were the first country to like legalize it, like, I’m like, what is happening in like one state, you know, um, or two states or, you know, and now it’s just like we’re being left behind because yeah, we’re out of these conversations.
[00:40:21] Cause we’re not taking that public. Aspect and like making it so that we can work in a global market. Eventually. I don’t know. This is literally like something I get a little fired up about.
[00:40:33]Kellan: Mexico are going to trade with each other and they’re just going to take it on a boat across, around the yard.
[00:40:38] What is going on here? Exactly
[00:40:40]Bryan: what he said. And we were like,
[00:40:42]Kim: no bad, frustrating. Very, yeah, and we want to be involved. I want all of my clients to be able to live that American dream cannabis style. Like I want them to be part of that global economy. I want them to be the big hitters. I want them to be the Coca-Cola and the Frito lay and the, [00:41:00] you know, I want them to be.
[00:41:01] The, you know, the companies that I started with when they were five people, I want them to be the ones that blow up, not other people in other countries. And certainly not, you know, just big conglomerates that are, once it opens up, you know, they’re going to come in and buy stuff up, you know, I want. Be a lot easier for the companies that we’ve actually helped to stay in there and make some money and have a good life.
[00:41:25] You know?
[00:41:26]Bryan: Um, when you hear it talked about being locked inside the United States, it really feels differently. Right? When you look at the globe, you see there’s always opportunities, but when he used the word locked inside the United States, it was just like, oh, that doesn’t feel good. Just to hear the way he’s phrasing.
[00:41:40]Kim: Well, and especially if we are allowed to buy from other countries, because then what happens, you know, cause then, then are, you know, companies in the United States, they’re competing, they’re competing with a globe, right. Of people, not just the people in the United States. So, you know, we need to expand and we need to make this [00:42:00] happen sooner than later, or else we are certainly going to be left behind.
[00:42:03] And I would hate to see that happen.
[00:42:05]Bryan: Yeah. Yeah, absolutely. What is one idea or fact about. CGMP process that would surprise cannabis opera.
[00:42:14]Kim: Um, I feel like a lot of it surprises cannabis operators. Um, maybe, maybe just the amount of time that it takes and how much work it actually is and how specific the verbiage has to be.
[00:42:28] So we actually help them decide which accredited certifying body they want. And they are usually shocked to know that each one of them is different. So they require different things. Um, they require different language in their SLPs and it has to be very specifically written to that standard that they are wanting.
[00:42:48] So. When, when you do something like buy templates and just kind of fill them out and throw it, Hey, this is our SOP. Most usually they fail because they aren’t, you know, thinking [00:43:00] about that language and those very specific things that, that accredited certifier wants. Whereas, you know, other certifiers might want something completely different.
[00:43:09] It just kind of depends. And the good thing about companies like ours is we’ve already done all that research and we know them they’re on speed dial. You know, we can call them when we have a question. Um, and make sure that everything is tweaked to the exact way, the way that that auditor wants to see it.
[00:43:24] Um, and sometimes that’s the deciding factor right there.
[00:43:28]Bryan: Since you’ve been in the cannabinoid industry, what has been the biggest misconception
[00:43:34]Kim: like from outside people?
[00:43:38]Bryan: Anything that was the first.
[00:43:40]Kim: Oh, lazy stoner. Uh, that’s like a hundred percent, um, you know, things have changed so, so much. I mean, now it’s like million, you know, billionaires in Olympic gold medalist use pot, you know, it’s very different than the old school, you know, Cheech and Chong days, or like, And, you know, tie dye, just sitting [00:44:00] around smoking.
[00:44:00] Um, there are so many people in this industry, first of all, also there’s a lot of people in this industry that don’t consume cannabis, which is like, I’m like, oh, okay. You know, uh, very different, but it’s true. I mean, there’s a lot of people that don’t, there’s a lot of people that consume cannabis and don’t drink in this industry.
[00:44:17] Uh, I remember I threw my first LA Palooza, which we’ve been doing for years. It’s like a little trade show that we throw every year in Denver. And, uh, my event planner, not in cannabis, she buys all this booze like all, and I’m like, man, that’s a lie. And she’s like, no, there’s 500 people coming. Yeah. And she’s used to like law firm parties and shit.
[00:44:37] No, we didn’t even go through half of it because everybody was smoking. Nobody was drinking, you know, and she was like, man, this is like the most mellow party. And I’m like, yeah, it’s the cannabis industry, you know, like it’s very different. Their mindset is very different about. Like consumption and being in headbutted and you know, those kinds of things.
[00:44:56] And there are a lot more open-minded about that kind of thing. [00:45:00] Um, yeah, I think the lazy stoner thing, I think that people, when they find out that I use cannabis, they’re like shocked. Cause they see me as like somebody who gets shit done and I’m like, yeah, almost every person that smokes cannabis gets shit done.
[00:45:12] Guess what? You know? And they just don’t realize it because they haven’t ever met that person. Um, and I think that’s, those stigmas are starting to clear up, thankfully. Uh, I hope, I mean, you know, when yeah, billionaires and Olympic gold medalists are, you know, admitting that they use cannabis, it’s a little shocking because those are like the people that you think.
[00:45:32] You know, would never, um, and I think the stigmas are finally starting to go away, which is a really good thing, but there’s still places in this country where yeah. I still get LinkedIn messages calling me a drug dealer. Okay. Sorry. You know, um,
[00:45:49]Bryan: let’s delete. So before we do prediction time, we ask all of our guests, if you could sum up your experience in a main takeaway or lesson learned to pass onto the next [00:46:00] generation, what would it be?
[00:46:02]Kim: Ooh, uh, write legislation with public health in mind from the beginning. Always because, uh, that’s one of the biggest downfalls that we’ve had in the United States is not having that in mind and having all of the, um, local health departments and state health departments not involved in cannabis at all.
[00:46:22] And so therefore, just like I was talking about with Canada, we’re kind of falling behind. So in the future when psilocybin and all of these other things, you know, other cannabinoids Delta eight Delta 10, when we start regulating these things, we need to really keep that in mind. Um, and I think it’s going to cause a lot less hardships for the people in the industry moving forward, because that was definitely something that Colorado and a lot of other states have really messed up on.
[00:46:47] Unfortunately. And of course I’m a public health advocate. So I have to talk about that.
[00:46:52]Bryan: Well, that should be on a bulletin board. I think that’d be really popular, especially here in times square. I like figured out guys, like here’s a message. Yeah. [00:47:00] The number one thing cannabis operators can do today to better position themselves for the future.
[00:47:06] And they can’t be
[00:47:07]Kim: CGMP well that’s okay. Uh, yeah, CGMP is great. I think that, um, structuring their company in a way that, uh, that makes sense. I know that sounds very vague, but I also, you know, I am a business owner and so when I go into businesses and I see how their. Uh, structuring their company and how, you know, w okay.
[00:47:34] Employees being involved in decision-making at a higher level is the deciding factor of whether you’re going to be a company that lasts. We’ll say that because a lot of times in cannabis, there is the person in charge, right? The owner CEO or whatever, and he’s more like a manager and he kind of, or he, or she, I’m not trying to be sexist here.
[00:47:59] It can be either [00:48:00] way. Um, If he doesn’t listen to the employees and, or they don’t listen to the employees and they don’t, um, they’re not responsive to the way that the company is built and they aren’t creating like a really good culture within the company. That’s when we see like major issues, like turnover problems, I mean, the turnover in the industry is just out of, out of control.
[00:48:20] And I think a lot of it has to do with the employees, not feeling like they’re included in the conversation and they’re not appreciated at all because right now everybody wants to work in case. So you can turn and burn employees like, like it’s nobody’s problem, but it costs a lot of money to hire and fire and go through that process.
[00:48:39] So if you treat your employees a little better, you’re one of those companies that’ll stick around. That’s something that I’ve just seen in the industry where people just don’t really understand that. I don’t know if they just don’t have like basic business backgrounds, which most people don’t. I certainly didn’t, um, getting involved, but that is something that I’ve seen across the board.
[00:48:59][00:49:00] Um, treat your employees like human beings and give them a little bit of a voice and hear what they have to say. And you know, that kind of thing. It helps the company run a lot smoother
[00:49:10]Bryan: Kaelin.
[00:49:12]Kellan: Um,
[00:49:15]Bryan: what was the question? The number one thing. Oh, I see. You’re stalling. You want me to repeat it again or repeat it?
[00:49:23] I think cannabis operators can do today to prepare for the future. No who
[00:49:29]Kellan: like, know what, who they are. Right. I think that, that a lot of times too, is like, they got into the industry, they’re here to make money. They like weed. Right. And then they’re like, okay, like now what? I have like a semi a business that’s like kind of standing up by itself.
[00:49:44] Like where do I go next? Right. I think like knowing what you want to build before you get involved, I think is really important because instead of just kind of like throwing all these things together and then kind of, you just have this like giant. Like taped up mess if you will, if you like know that, like, Hey, I [00:50:00] want to be a boutique small operator that makes this much product every, every month.
[00:50:06] It’s a lot easier to then fit into that, that, uh, square or that puzzle piece, if you will. Or you’re like, Hey, I want to be the Coca-Cola. I want to be in every state. I want my product on every single shelf. Like that’s to get to that goal. It’s a completely different roadmap, you know what I mean? And so if you don’t know, like where you want to go, Navigating that path is going to be so challenging.
[00:50:28] And I think that’s where you saw a lot of companies fail early on is they just kind of got some money. They’re excited to be in the industry. Like six months, like 12 months into it kind of that like honeymoon phase wears off. And then it’s like, oh wow. Like I have to show up to work every day and like go through this grind.
[00:50:45] But like, what am I, what’s my why now? Right. So I think that that really is one of the bigger, uh, situations I’ve seen, uh, people get entrepreneurs, at least getting into the space. What are your thoughts,
[00:50:54]Bryan: Brian? I think that’s well said also I’m going to kind of piggyback off that and do scenario planning.
[00:50:59][00:51:00] I think more operators can do more scenario planning for future efforts. So for example, like you were saying today, What happens if I think if leadership would think more like that, then I think their short-term actions will reflect where they want to be in the long-term. Whether that means starting the process with you today, even with it’s a couple hours a month, right?
[00:51:19] Just the. Start the steps forward because what most people can’t do when everything gets forward is they can’t go back in time and change results. And I think that that’s going to be a big problem with the industry right now is a lot of people are very shortsighted with keeping the lights on and driving home sales.
[00:51:34] But by doing additional scenario planning for the future, I think they can kind of align both the short and the longterm, you know, for better futures.
[00:51:43]Kim: Well said. Absolutely.
[00:51:45]Bryan: So Kim, for our listeners who want to get in touch, they want to start the process. Where can they get.
[00:51:51]Kim: Uh, yeah, you can just go to our website, www.la, a L L a Y consulting.com.[00:52:00]
[00:52:00] There’s a whole thing you can fill out and we’ll have somebody reach out to you right away. Um, yeah. Or, you know, we also are on LinkedIn, so if you want to follow us there, we have a lot of stuff. We post videos and talk about, uh, up coming legislation and all that fun stuff. So, um, we’d love to have you as a follower or yeah.
[00:52:18] Feel free to reach out. We’d love to talk. Cool. We’ll link it up
[00:52:21]Bryan: in the show notes. Thanks so much for your time, Kim.
[00:52:24]Kim: Thank you.
