5 Reasons Why Social Equity is Important for Your Cannabis Business

5 Reasons Why Social Equity is Important for Your Cannabis Business

June 09, 2021

By Sarah Mendy

Social equity is a term usually confused with social equality. The difference between equity and equality is that equity is concerned with getting everyone the things that they need while equality ensures that everyone gets the same resources. Social equity considers a person’s race, culture, gender, class, and other factors to ensure that the person gets the right amount of resources that are needed.

Concerning the cannabis business, social equity pushes against the injustice committed in the cannabis industries by lawmakers and regulators. Cannabis has been used as a way to get to people of color and charge them for crimes that the whites will not be charged with. People who are of the legal age to use cannabis are being arrested and placed behind bars for taking cannabis. Social equity programs are designed to fight against these injustices.

Thanks to social equity, 17% of executive positions in the cannabis industry were being held by people of minority as of 2017. These programs of beneficial to the cannabis business in many ways, here are five of them.

1. Ease of Entry

Social equity helps to render help to those who need it. One set of people who need social equity are prospective startups. Entering into the cannabis business will require a lot of money so you need to be rich to own cannabis business and this will grant opportunity to only a set of people and kill the dream of people who cannot afford to purchase an application form or pay the extravagant cost to fill the form.

Social equity allows the government to generate more income through the taxes to sponsor the cost of applying and getting a license to own and run a cannabis business. this cost can range from as low as $3,000 to as high as $20,00 which is the cost in California.

2. Protects Businesses

When a social equity applicant gets the resources to start a cannabis business, the person immediately becomes a target for rich investors. These investors seeing that a business is well structured and has the potentials of making more than 7 figure profits will seek to buy the business from the applicant.

Social equity implores lawmakers and regulators to watch out for situations like this and make sure that the ownership details of a business always correspond with the details in the agreement that was signed with them. This will help to prevent the transfer of a business to someone else who already has enough.

3. Provides Education

Social equity helps to provide the necessary education for people who will like to start the cannabis business but have no idea about how to go about it. Social equity programs will educate people in rural areas on how to apply for and process a license to begin a cannabis business. The programs also teach people how to create standard business policies that will help the business thrive.

Social equity programs can employ the services of cannabis business consulting firms to advise people on the right strategies to apply to get the best out of their businesses.

4. Diversity in Leadership

Social equity helps to make sure that the executive positions in the cannabis industry are diversified and stakeholders are of different races. It is important if choosing executives for a business, diversity, and inclusion are represented so that the concern of every member of staff is represented by someone in the high ranks.

The regulators will have to do their due diligence by looking into the individual record of all executives before a business is registered.

5. Wealth is Shared

When communities that have suffered from the injustice by the war on drugs are given a chance to step into the cannabis business, it creates employment and wealth for a lot of people and helps them rebuild their community.

Social equity works to secure the best interest of everybody, however, some social equity programs might not be completely fair in making sure that everyone gets what they deserve. To make social equity work, everyone in the cannabis industry – regulators, business owners, and customers – have to play their part to make it work. It is only when everyone is working towards achieving a common goal that the goal can be achieved.

About the Author

Sarah is a budtender working at a dispensary. Accordingly, budtenders must be personable and have exceptional customer service skills while also possessing experience in sales and customer relations. Sarah likes to share everything that she knows related to this industry with the general audiences and she does this through her writings, as it is also her hobby.