The key facts you need to know as a liquor store owner.
We know you’re busy. So we’ve tried to get to the point.
**DISCLAIMER** We are not lawyers. We have attempted to help digest and read between the lines after doing significant research. Before taking any action review the law, speak to your lawyer, and make a determination yourself.
🔹 Terms: “low potency Minnesota grown hemp derived THC” is the subject of this article. We’ll refer to it as LPMN-THC for the remainder of this article. CBD is different. Delta9 is a form of THC – it’s the fun kind. Delta8 is the sleepy kind. Legal dosages are 5MG per serving. The max number of servings per container is 2. So, if you are seeing drinks with more than 10ML, they will be phased out soon though there is some grace period for that.
🔹 The bill was passed by the state House and Senate early Saturday 5/20/2023. It is slated to be signed by Governor Walz by Tuesday 5/30. He has previously expressed strong support for the bill. That means liquor stores should have the ability to sell it on 5/31.
When we find out we will update this article and make a note in RED that it was updated and when. Check back occasionally.
🔹 Customers must be over the age of 21 to purchase and it is law that you must card ALL customers regardless of age. Your POS should be able to force checking IDs on specific products. Enable that. If you are a Cloud Retailer user submit a ticket or check this out https://helpdesk.cloudretailer.com/support/solutions/articles/67000669385-how-to-configure-and-use-age-verification
🔹 Purportedly, a 5 mg serving has a similarly intoxicating effect of two cans of alcoholic beer to the inexperienced. The first time someone tries a THC product they usually do not get intoxicated. This can lead someone to overdo it the second time. Advise your customers to take no more than 10 mg the first time they try it and it’s likely that they won’t feel an effect until they try it the second time.
🔹 You DO NOT need to sell BEVERAGES behind the counter. This was a recent change to the bill. You DO still need to sell edibles behind the counter. We are checking to see if cookies and the like are allowed in a liquor store.
🔹 80% of credit card processors do NOT approve the sale of “low potency hemp derived THC”. Most are looking the other way however it is very risky to sell using one of these processors. According to your processing agreement, they can hypothetically shut down your account and keep the money. We have actually seen this done by a payment processor – it was hundreds of thousands of dollars. Those companies have more and better lawyers than you do. Again, it sounds like a lot of people are looking the other way but even if it’s a 1 in 10,000 chance – is it worth it? Call your processor and ask them. If you don’t get the answer you’d like, call us (320-230-2282). We know who the 20% are.
One other note – make sure that you are not qualified as a “high-risk merchant” for selling these products. You will be charged A LOT more for processing if you are. As long as sales of it are less than 15% of your volume you should be considered low risk. Again, find the 20% of processors who are on board with LPMN-THC OR CDB sales.
🔹 Three processors that DO NOT (officially at least) allow the sale of LPMN-THC / CBD products? Heartland, Worldpay, and Elavon. Elavon appears to be one of the few NOT “looking the other way” on CBD. Check it out: https://www.cannabisbusinesstimes.com/news/us-bank-evalon-pulls-out-merchant-services-cbd-industry/
🔹 Liquor stores will likely not be able to sell the full-potency product that is coming later. You would need to set up a separate dispensary business. If you do, you will basically have no choice but to accept cash for that product while it is still federally illegal.
Why? While it’s still federally illegal there’s a risk that the banks are participating in money laundering. They will not jeopardize their billion-dollar businesses so you can sell these products.
SIDE NOTE: Make sure your POS system has a feature so that you can force certain products to be paid for with CASH 💲💲. There are still many questions about full-potency marijuana and liquor stores. This will NOT be legal this coming Saturday. We will know more in the coming months. However the law pans out, Cloud Retailer POS will FULLY support liquor stores’ capability to take advantage of this opportunity.
🔹 If your customers are going to be more amenable to cash – now might be the time to take your credit card fees back and do dual pricing. Check it out: https://www.cloudretailer.com/dualprice-pos/
🔹 Who has authority over this product? Long-term there’s going to be an Office of Cannabis Management. In the interim, it’s unclear if it’s the Board of Pharmacy, the Minnesota Department of Health, or liquor control.
🔹Comprehensive documentation from the state: https://cannabis.state.mn.us/business.html
🔹 With liquor you CANNOT transfer products between stores. Can I transfer LPMN-THC between stores? Article to be updated soon.
🔹 A 10% tax is coming. This will apply to full potency and LPMN-THC. Local sales tax only FOR NOW. The 10% tax will be on top of sales taxes. The date this goes into effect is likely August 1. We will post an update as we know more.
🔹 Any companies you work with should have “lab results” posted on their product’s website. All products should have a QR code on the can. We’re hearing that the big deal compliance-wise will be the low THC concentration AND they want the money to stay in Minnesota so it has to be Minnesota grown. Check out Lupulin’s THC page for reference: https://www.lupulinbrewing.com/thc/
🔹 Check your city and county ordinances. Many are limiting the sale of LPMN-THC. Ignoring these ordinances could put your liquor license at risk. Many cities are also requiring you to apply for a special permit. Waite Park, a suburb of St.Cloud is an example. https://www.ci.waitepark.mn.us/AgendaCenter/ViewFile/Item/2697?fileID=7850
🔹It appears the state will be assuming control over the permitting and cities will have less control. We strongly recommend working with your city to ensure compliance. After August 1 permitting will be more clear.
🔹 There are differing reports on enforcement BUT at least some are getting in trouble. Check it out: https://racketmn.com/lots-of-liquor-stores-are-selling-thc-and-cbd-but-its-still-not-legal.
🔹 Question: if people in the credit card business are “looking the other way” how will I get in trouble?
ANSWER: You know those credit card people who come into your store almost every day? They know the process to turn you in to be investigated. If a formal complaint is lodged, then there’s no longer any turning a blind eye. It’s rare, but a small group view this as a sales tactic.
🔹 Suggestion: print out some general information about what it’s like to consume THC. Print it out, and include it with the sale of these products. Great opportunity to educate your customers and staff.
🔹 If you have better information than we do – please reach out – firstname.lastname@example.org. Thanks to Tony at the MLBA for being a great resource on the topic. If you’re a liquor store in Minnesota, you’re crazy not to be a member. If you are a city-owned liquor store, the same is true of the MMBA. Another great organization.
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