502 Producers & Processors: ACT NOW! Sign this Petition to the LCB!

Mr. Flynn, Thank you for all of your continued work and advocacy for the industry! I would like to suggest amended language to WAC 314-55-010(26), which currently prohibits sales below acquisition cost. This is creating the following issues: 1) Product purchased at the peak of the market (July-Sept) which does not sell through remains on the retailer's shelves without the ability to effectively discount as market conditions and prices fluctuate. When market prices drop and retailers are not able to effectively discount product, that product remains on shelves deteriorating over time, which damages processor's reputations and processor/retailer relationships. In multiple cases we have taken back 6+ month old product that didn't sell (at full credit) because retailers are unable to discount effectively. 2) Co2 cartridges which have a high failure rate with consumers can not be exchanged or replaced at no charge - this creates a huge customer service issue and becomes extremely burdensome and damaging to both the processor and the retailer. Under current rules, when there is a product issue the only option for a processor is to send cash (the full retail price + taxes) to the consumer. Thus, an item that sells for $6 wholesale, with a failure rate of 10%, sold at retail for $24 including taxes, will net the processor only $3.60/unit after reimbursements (not including the time of writing checks and postage). 3) Processor to processor transactions, which are often done on a split are prohibited e.g. processor 1 sends trim to processor 2 for extraction, processor 2 agrees to take a split of the material as compensation for extracting and returns a portion of the extract to processor 1. This is common practice, and under current rules these transactions, while typically completed without payment, are invoiced at "fair market value" serving only to unnecessarily inflate revenue numbers for both processors and the industry. I would suggest new language allowing for old inventory to be discounted below acquisition cost, allowing processor to processor sales to be done at no cost(trade), and product returns/replacements to be allowed. Given the current tax structure there is no reason to for these types of transactions to be prohibited. Furthermore, the reputational damage of not being able to exchange defective products is very real. We have been blasted publicly on our company website and facebook on two occasions for product failures that could not be effectively addressed at the retail level.

Again, thank you for your work.