Understanding Cannabinoids: CBN vs CBD
While there are many cannabinoids that may enhance the therapeutic effects of hemp products, the most common renowned product is the phytochemicals in the Cannabis genus that contain the tetrahydrocannabinol or THC. This is the substance that is responsible for all of the psychoactive effects of cannabis. CBD has long been associated with the variety that offers up the best help benefits without offering up the high that the THC gives to users.
While the CBD may not be the feature that is in all of the hemp products, it’s a by-product of the THC. Hemp Genix, Wholesale CBD Oil in Lane, has 80% purity compared to competitors at 17%-40%. The CBN doesn’t bind to the body’s cannabinoid receptors like the THC does. It’s long been known to give a stronger sedative effect when it’s used in combination with the THC.
At Hemp Genix, all of our products are made with 100 percent USA, Zero THC and 80 percent purity Wholesale full-spectrum CBD oil in Lane. This is carefully derived from a variety of cultivars of hemp which contain an abundance of cannabinoids.
A lot of people are very familiar with CBD or Cannabidiol. This is found in highly concentrated amounts in a variety of products. However, there are lots of cannabinoids that are found in hemp. These have shown a variety of benefits in studies. All of our products offer you full-spectrum hemp oil. This also includes all of our cannabinoids that are found in the plant. We don’t want you to miss out on any of the benefits.
Wholesale Cannabidiol CBD in Lane
This is the most abundant cannabinoid in the hemp oil. It makes up 90 percent of the content of cannabinoid. It’s non-psychoactive and the focus is on how it benefits the body via the hemp oil. It has minimal affinity for CB1 or CB2 receptors. The main focus on interaction is in the endocannabinoid system and it acts as an indirect antagonist toward the cannabinoid antagonists. This, in turn, may allow the CBD to temper the high that is caused through the THC. Wholesale CBD Oil in Lane from Hemp Genix are over 80 percent pure and CBD makes up the majority of the Oils weight. Industry averages and nearly all of the other products with cannabinoids and brands average in at 17 to 40 percent purity.
What’s The Difference Between CBD And CBN?
Cannabis has a number of cannabinoids in which the most abundant are the levels of THC. There are 9 tetrahydrocannabinol as well as CBD and CBN. This is the active ingredient that makes you high. The THC is in the plant and the CBD is the precursor and the CBN is the metabolite of the THC. As the cannabis ages, the THC level breaks down into the CBN.
This also leads researchers to believe that the CBD might give some protection against ecstasy-derived neurotoxins or long-term depletion of the serotonergic receptions. While this is still speculation, it’s investigating further. The CBD is usually present in significant enough quantities in such products as hashish or cannabis resins. However,r it’s also in the herbal cannabis referred to as skunk in smaller amounts.
Overall, the CBN is a great cannabinoid that offers up a varied range of therapeutic applications that work together with the rest of the “team” in order to offer up the best possible results. Clearly, more clinical trials are required to see how else it can benefit patients.
Wholesale CBD Oil in Lane South Carolina
Although selling marijuana is now legal in 24 states and the District of Columbia, doing business as a legal marijuana company is a logistical nightmare. That's because marijuana is still federally illegal, and banks open themselves up to potential seizure by the FDIC if they take money that is the result of a federally illegal act.
Despite the fact that President Obama has given financial institutions the green light to serve the legal cannabis industry (so long as they monitor closely for potential money-laundering and other violations), most banks won't work with the $6.7 billion marijuana industry. The result is that 70 percent of cannabis companies don't have a bank account. The few banks that do take on marijuana clients do not advertise what they're doing.
Enter Hypur, a startup in Scottsdale, Arizona, that for the past year has been quietly convincing banks that it is safe and profitable to work with cannabis businesses.
Hypur, which was founded by a team of banking compliance and software entrepreneurs in 2014, has successfully helped about five banks in Colorado serve a number of cannabis businesses in the state. Hypur would not reveal which banks, citing nondisclosure agreements.
The startup's secret sauce is a software platform that audits a cannabis company in its entirety, shifting through documents and state licenses, financial statements, tax returns, property leases, and more, to ensure it is legal and legitimate. The software connects to the cannabis company's point-of-sale system as well as the state's seed-to-sale system, which follows marijuana plants from the grow house until they're sold to a customer, to monitor the business and ensure compliance.
One of the greatest hurdles for banks that do want to do work with this lucrative market is to make sure businesses are compliant under state law. It can take up to 20 hours for a banker to do a single marijuana business's paperwork, while other businesses can get a bank account set up within an hour, says Andre Herrera, executive vice president and co-founder of Hypur.
Michael Sinnwell, chief operating officer and co-founder of Hypur, adds, "That's one of the biggest things--banks spend a lot of time chasing paper and we're eliminating the paper-chasing."
After Hypur has collected all the licenses and documents and has proved the company is legally operating in the state, the system creates automated notifications and red-flag triggers for when a license or lease will expire to make sure the client does not fall out of compliance.
Banks using Hypur are granted access to granular financial information coming from each dispensary's point-of-sale system. (Hypur is integrated into POS software like Flowhub and BioTrack THC and marketplace platforms like Tradiv.) Not only can banks on the platform assure bank regulators like the FDIC that everything is above board, Hypur breaks down the provenance of every dollar coming into a cannabis bank account, says Sinnwell.
"Here's where the money came from and here's how much cash you should expect coming through your door at any given point. We allow banks to know a given transaction is a legitimate transaction between a consumer and that merchant," Sinnwell says. "We call it Know Your Customer's Customer. Banks know their customer but now they have an idea of their customer's customer to make sure it's not laundered funds."
Follow the money.
The ability to know you customer's customer is a big deal in the banking world. Once a Hypur customer gives a cannabis business an account, that business is encouraged to have its customers download Hypur's mobile payment app. The app, which is about to finish beta testing, hosts a direct bank-to-bank electronic transaction, meaning a customer pays directly from their bank account to the cannabis business's bank account. The bank can follow each transaction coming in and follow the product going out of the business.
"Our goal is to eliminate cash," Sinnwell says.
Cash is not only a pain to deal with and keep safe; it also poses danger to the merchant and the merchant's employees. Money also walks. Cash businesses tend to lose 10 percent due to theft. Lastly, businesses that are cash only are inconvenient to customers.
While 30 percent of cannabis companies have a bank account, no cannabis company can accept debit or credit cards because companies like Visa and Mastercard will not give the industry merchant accounts until federal law changes. For this reason, an entire cottage industry of armed cash pick-up and delivery companies has emerged in states like California, Colorado, Oregon, and Washington to bring millions in cash to entrepreneur's homes, private vaults, or banks or local federal reserve branches (some banks prefer to bring the cash straight to their federal account) for the ones with bank accounts.
Hypur's platform and app allows banks to see each dollar come into a business's account and match with a customer and product. When a cannabis client's armored truck pulls up to a bank, the bank knows exactly how much is coming and where each bill came from.
According to Hypur, it monitors hundreds of millions of dollars of transactions a month. The company, which raised $6 million from investors, doesn't serve only the cannabis industry. It also serves any cash-intensive business, like gun and ammunition shops, payday lenders, off-track betting parlors, and pawn shops. Sinnwell says that the Hypur platform provides effective tools to companies that are struggling for credibility and acceptance by financial institutions.
"Once the data and information starts to flow and banks can know a business isn't laundering funds, that's when the industry blooms," he says. "The biggest thing for regulators is to know that all of this cash is accounted for."
The First Family of Legal Marijuana
There's an old adage about business that "cash is king" and, if that's so, then cash flow is the blood that keeps the heart of the kingdom pumping. Cash flow is one of the most critical components of success for a small or mid-sized business. Without cash, profits are meaningless. Many a profitable business on paper has ended up in bankruptcy because the amount of cash coming in doesn't compare with the amount of cash going out. Firms that don't exercise good cash management may not be able to make the investments needed to compete, or they may have to pay more to borrow money to function.
"Despite the fact that cash is the lifeblood of a business -- the fuel that keeps the engine running -- most business owners don't truly have a handle on their cash flow," says Philip Campbell, a CPA and former chief financial officer in several companies and author of Never Run Out of Cash (Grow & Succeed Publishing 2004). "Poor cash-flow management is causing more business failures today than ever before."
Academic studies over the years have found that cash flow problems can be one of the leading causes of failure for businesses. A study reported in August from Equifax, the credit reporting agency, found that bankruptcies among the nation's 27 million small businesses leaped by 81 percent between June 2008 and June 2009. While the U.S. Small Business Administration (SBA) estimates that about 600,000 new small businesses are launched each year, a 2007 study reported in the U.S. Bureau of Labor Statistics' Monthly Labor Review indicates that two-thirds will only survive two years, 44 percent survive four years, and 31 percent survive for at least seven years. Scholars have found over the years that insufficient capital is one of the main reasons for small business failure, coupled with lack of experience, poor location, poor inventory management and over-investment in fixed assets, according to the SBA.
The following pages will help you understand what cash flow is, how it impacts profits, and tips on how to improve your cash flow.
Cash Flow Basics
What is cash flow? It's basically the movement of funds in and out of your business. You should be tracking this either weekly, monthly or quarterly. There are essentially two kinds of cash flows:
• Positive cash flow: This occurs when the cash funneling into your business from sales, accounts receivable, etc. is more than the amount of the cash leaving your businesses through accounts payable, monthly expenses, salaries, etc.
• Negative cash flow: This occurs when your outflow of cash is greater than your incoming cash. This generally spells trouble for a business, but there are steps you can take to remedy the situation and generate or collect more cash while maintaining or cutting expenses.
Achieving a positive cash flow does not come by chance. You have to work at it. You need to analyze and manage your cash flow to more effectively control the inflow and outflow of cash. The SBA recommends undertaking cash flow analysis to make sure you have enough cash each month to cover your obligations in the coming month. The SBA has a free cash flow worksheet you can use. In addition, most accounting software packages geared to small or mid-sized businesses – such as Quickbooks will help you produce a cash flow statement. There are also other websites offering free templates, including Winsmark Business Solutions and Office Depot.
Profit versus Cash Flow
Profit does not equal cash flow. You can't just look at your profit and loss statement (P&L) and get a grip on your cash flow. Many other financial figures feed into factoring your cash flow, including accounts receivable, inventory, accounts payable, capital expenditures, and debt service. Smart cash-flow management requires a laser focus on each of these drivers of cash, in addition to your profit or loss. "There is a secret that very few business owners have discovered (and the accounting community has not done a good job revealing): knowing whether you earned a profit (or created a loss) is not the same as knowing what happened to your cash," Campbell says. "Profit, as defined by the rules of accounting, is simply revenue minus expenses. Invoicing a customer for products or services you sold to them creates revenue. Actually collecting the money on that invoice is what creates cash."
A positive cash flow is actually needed to generate profits. You need enough cash to pay your employees and suppliers so that you can make goods. It's the sale of those goods that helps generate a profit. But if you don't have the money to make the goods, you don't end up with the profit. So you really need to structure your business to have a positive cash flow if you want your business to grow and increase profits.
"Growing your business puts a huge strain on cash," Campbell says. "You almost always have to make investments and bring certain expenses on ahead of achieving the higher revenue and cash flow that comes with successful growth. Maybe you want to open an office in a new city so you can build the business there. Or, you need to build a new facility so you have the capacity to sell to larger customers. Those scenarios (and others) require cash up front."
How to Improve Cash Flow
Most business owners see growth as the solution to a cash-flow problem. That's why they often achieve their goal of growing the business only to find they have increased their cash-flow problems in the process. Plan for growth and the related cash outlays in advance, so they do not come as a surprise. In the meantime, the SBA recommends that you take the following practical steps to better manage cash flow, especially for the growing business:
• Collecting receivables - To speed up the receipt and processing of receivables, the SBA suggests several steps. Spring for a lockbox service, post office boxes serviced by banks so that customers in far flung locations can mail payments there and the checks will be processed by the banks more quickly. Ask customers to preauthorize checks so that banks can draw against their accounts at timed intervals. Centralize your banking at one bank. Ask customers to pay with depository transfer checks, a relatively cheap fund transfer. You can also try offering discounts to customers if they pay bills quickly.
• Tightening credit requirements - Businesses often have to extend credit to customers, particularly when starting out or growing. But you have to do your research beforehand to determine the risk of extending credit to each customer. Can they pay their bills on time? Is their business growing or faltering? Are they having cash-flow problems? The SBA recommends getting a Dun & Bradstreet report on potential customers and asking them to fill out a credit application. You should also check references. Another option to extending store credit is to accept credit cards. This will cost you a percentage, generally from 2 to 5 percent of the sale, but it may be a safer bet for getting paid on time.
• Increasing sales - If you need more cash, it seems like a no brainer to go out and try to attract new customers or sell additional goods or services to your existing customers. But this may be easier said than done. New customer acquisition is essential to a growing business, but it can take time and money to convert prospects into sales. Selling more to existing customers is cheaper and you may be able to do this by analyzing what they're buying and why - information that may even lead you to increase your profit margin and, hopefully, generate more cash. But the SBA warns businesses to be careful when increasing sales because you may just increase your accounts receivables and not actual cash if these sales are on credit.
• Pricing discounts - One option to increasing cash flow is to offer your customers discounts if they pay early. While this practice may impact your profit margin, it may help your management of cash flow by incentivizing customers to make payments earlier than billing cycles typically require. Your company may also take advantage of this with suppliers and others that you owe, but be careful that your early payments of debt don't leave you with a cash flow shortfall.
• Securing loans - Short-term cash flow problems may sometimes necessitate a business taking out a loan from a financial institution. Some possible types are revolving credit lines or equity loans, according to the SBA. Most of the time this type of borrowing accomplishes its goals, although during the financial crisis many banks were canceling credit lines and calling in loans. Another option is a long-term amortized loan which includes interest and principal until the loan is paid off.
Getting Control of Your Cash Flow
Campbell suggests asking yourself the following two questions to get a sense about whether you have your business' cash flow situation under control:
1. What is my cash balance right now?
2. What do I expect my cash balance to be six months from now?
"If you can't answer these two questions, then strap yourself in for a wild ride," he says. "You are on a roller coaster ride that's about to become really frightening. You don't have your cash flow under control."
One way to keep that situation under control is by tracking your cash flow results every month to determine if your management is creating the type of cash flow your business needs. This also helps you get better and better at creating cash flow projections you can rely on as you make business decisions about expanding your business and taking care of your existing bills.
Inc.'s Guide to Cash Flow Basics
The Secret to Formatting Cash Flow Projections
The 10 Absolutely Must-Follow Cash Flow Rules
Cash Flow Projections Made Easy
http://www.neverrunoutofcash.com - Philip Campbell's book and the companion audio CD sets out the detailed approach to taking control of your cash flow.
http://www.score.org/60_guide_managing_cash_flow.html - This site features a quick guide to managing cash flow.
http://easy.staples.ca/en/work/articles/startyourbusiness/Pages/manage_your_cash_flow.aspx - The office supply chain has a run-down of cash-flow management tips.
http://www.sba.gov/idc/groups/public/documents/sba_homepage/serv_capgrowth.doc - This document discusses cash flow management as part of the SBA's financial management series.
http://www.sba.gov/idc/groups/public/documents/sba_homepage/pub_fm4.pdf - Small Business Administration -- This government brochure is full of cash-flow management tips.
http://www.nfib.com/tabid/56/Default.aspx?cmsid=49882&v=1 - Tips from the trade industry association for small business on how to manage cash flow.