How Street Dealers Are Dealing With Legal Weed
WHY YOU SHOULD CARE
Because the grass is always greener in another state.
By James Watkins and Breed
In this original weeklong series, The Evolution of the Side Hustle: How Gigs Are Killing the 9-to-5, OZY charts the past, present and future of the side hustle. Do you have a unique side hustle that OZY should know about? Let us know at firstname.lastname@example.org and we might feature your gig.
Each package that he puts in the mail is worth around 20 grand or more. With up to 5 pounds of weed packed together — each pound individually vacuum-sealed and stuffed in a bulk bag of Pedigree dog food to mask the smell — it’s a valuable shipment. But the risk of using a commercial mail service — he wouldn’t tell us which one — comes with the potential reward of the highest prices he can fetch for his product. Then it’s just a waiting game as you “hope that bitch gets there,” he says.
As cannabis clubs start popping up across the eight states with legalized recreational marijuana, as well as the 20 others where you can buy the stuff if you get your hands on a card or certification of medicinal need, one of the oldest side hustles — street weed dealing — may seem to be threatened. But the black market in green is alive and well, with shipping out of state as the latest sales tactic. OZY spoke to some enterprising Bay Area dealers about the widening horizons of their hustle — from street-corner retail to interstate wholesale. With some of the lowest-cost and best-quality weed in the country, California dealers are finding lucrative opportunities in packing and shipping their product in bulk, with a little help from their favored intermediary, the clueless mailman.
One dealer we spoke with had lost a hundred grand, twice, from shipments gone MIA …
The tactic isn’t a direct response to legalization, which the dealers say hasn’t affected their business model too much — yet. In the Bay Area, bud currently costs about half as much on the street as it does from a legal dispensary, but if the legal price comes down, it could encourage at least one of the dealers we interviewed to contemplate opening a legal, regulated operation. Meanwhile, in the past few years these entrepreneurs have taken up out-of-state shipping as a tactic to make extra cash: Selling bulk shipments out of state can turn a profit of one to two grand per pound, compared to a couple of hundred when selling in bulk locally and less than a thousand if packaged in smaller quantities for local street sale.
Here’s the rub: Certain states treat low-level dealing as a misdemeanor; the feds classify shipping across state lines as trafficking — a felony punishable by five or more years of incarceration and several hundred thousand dollars in fines. With a fake return address posted on packages, though, it’s difficult to trace back to the sender, and so it’s a risk the dealers we spoke with are willing to take once or twice per week. For these Bay Area wholesalers, North Dakota and Delaware are two of the prime markets because local weed is so expensive.
But it’s a gamble. Packages regularly get intercepted or picked up by someone other than the intended recipient or end up at bogus addresses. (Before sending major shipments to new clients, dealers typically send smaller test packages to build trust in their far-flung business associates.) While, according to the U.S. Postal Inspection Service, first-class parcels sent with USPS are protected against search and seizure without a warrant under the Fourth Amendment, the USPS reportedly seized more than 34,000 pounds of marijuana in 2015, down from 42,000 in 2012. Because no estimates exist for how much gets past inspectors, it’s unclear whether that drop is due to poorer enforcement as USPS budgets fall or decreased shipment volume.
One dealer we spoke with had lost a hundred grand, twice, from shipments gone MIA and spoke of a friend who had lost even more. But the expected losses are outweighed by the potential returns, which usually find their way back in cash — again, via the clueless mailman.