From Alexandra township to running a thriving cannabis dispensary in Joburg CBD

As government relaxes regulations in the cannabis CBD market, young entrepreneurs are increasingly building successful businesses

By  Edward Tsumele

This popular commercial centre on Juta Street in Braamfontein, an area of Johannesburg brimming with youth energy as it in an area that boasts educational institutions, such as Wits University and other private tertiary institutions such as Birnam College, Rosebank College and Damelin among others, has a number of establishments frequented by the trendy and happening in the area.

Directly opposite the popular night time hang out bar and restaurant. Kitcheners, this centre ensconced at a corner street, houses a coffee shop, an art gallery and boutique clothing shops among other  popular  tenants.

And yet there is another tenant of a different kind, a cannabis dispensary, selling a wide range of CBD infused products. Having opened in the area just over a year ago, Med Leaf has become a hit with both the young and old from around inner city Johannesburg and as far as  the Johannesburg townships of Soweto, Alexandra and those coming from as far as the East rand townships, who make their way through doors to shop around a wide range of CBD infused products on sale here. Product choice is also as wide  ranging as it is exciting. The products on offer include  pet treats, cosmetic lines, edibles and those that deal with normal afflictions of life such as anxieties, pains, insomania, depression,  headaches and dietary requirements. There is even a product meant to make sex more enjoyable and exciting.

 “This one called Silky Hydrant Lube is one of the most popular products with our customers,” says Med Leaf Director Harold Raselabe, flushing a naughty smile.

Med Leaf is the brain child of Alexandra born former events organisers-turned cannabis businessman  Raselabe.

Med Leaf is one of an ever increasing number of businesses that are starting to take shape in the emerging cannabis industry in South Africa, following the government’s recent rescheduling of  one of the several compounds of cannabis, from a restrictive schedule that originally was in the same schedule as hard drugs into now a pretty much unscheduled product,  open to trade in under defined exemptions. CBD that is  allowed be traded in South Africa without the need for a permit or license has a negligible amount of THC, the psychoactive compound that makes smokers to be high.

This latest development in the country has resulted in a number of CBD infused products hitting the market in a big way, and innovative entrepreneurs, such as Raselabe have taken advantage of this opportunity to open thriving businesses in this new industry that the government is still to regulate properly as the move to regulate rather than completely ban cannabis products, such as CBD and hemp for commercial trading, is fast gaining momentum around the world, from the US to South Africa.

However, how Raselabe got into this industry was though tragic circumstances and pain, but has now found peace and business out of the past personal loss  of three years ago when tragedy struck in his family, losing his mother to cancer.

“My mother was diagnosed with cancer and she was on chemotherapy, but watching her suffer tremendous pain drove me to looking for alternatives to the Western traditional medicines that she was getting. That is when I discovered cannabis, and we incorporated cannabis alongside traditional Western medication. Unfortunately we only discovered this alternative method of treatment when it was too late as her disease was already advanced, four years in the process,” Raselabe explained his journey into the cannabis business.

“When our mother passed away three years ago, we sat down and decided as a family that we would not like to see another mother suffer the pain our mother suffered, and so the research into cannabis started. Of course we had to use global studies as references, as locally there was a grey area with regards to research into the cannabis as it was deemed illegal. Many people as a result, resorted to the black market to source and do research into cannabis and its useful properties,” Raselabe revealed.

The businessman explained that once he was convinced that there was a business case to pursue the cannabis business and completely abandon his career as an organiser for music events, he still faced hurdles on the way into the cannabis industry, however.

“First of all, we needed to find out who are the suppliers of the products, the laboratories that we could work with to assist us with the kind of solutions we wanted to bring into the market.  That pretty much entailed working with laboratories and mixologists until we got it right. We eventually did.”

The businessman sees a lot of opportunities for entrepreneurs in the cannabis business, especially If government moves fast and clarifies a lot of grey areas that he says still exist, and these are proving to be a problem to the potential of this new industry.

For example, since the business started three years ago, with Raselabe as director, its physical shop, and its online shop, which is currently being revamped to be more interactive, employs five people, Raselabe included.

“In fact in two weeks time, we are going to upscale our marketing activities, especially concentrating on revamping our website. In fact next week we will be doing a photo shoot with two models, to demonstrate to the market that we are serious about our brand, including our packaging where we spent a lot of time with brand experts to come up with a well packaged product that exudes class. We now have settled for a particular brand look, that includes appealing packaging, such as our unique bottles for our CBD products that are sourced from legal manufactures that are GMP (Good Manufacturing Practice) compliant and that meet all the legal requirements.

Going forward, we are planning to grow this business as we are currently looking for five other locations, but we see ourselves having  10 retail stores in different locations in the next five years” he revealed.

Raselabe is in fact not alone in thinking big when it comes to the potential of the cannabis industry to create jobs, wealth for enterprising business  people like him, as well as eradicating poverty and add to the country’s fiscus once properly regulated.

The global legal cannabis market is currently estimated to be around $30 billion and anticipated to reach somewhere between $75 billion and $100 billion by 2030. That’s formidable in anyone’s books, especially for an industry that is fresh out of the starting gates, long sequestered behind a firewall of prohibition.

But much of the world – save perhaps for parts of southeast Asia – is seeing swift and fundamental changes in attitudes and laws.

Research-based recognition of the plant’s seemingly infinite medical and industrial applications is fuelling a legalisation rethink across most of the globe. And such developments are bringing an end to decades of prohibition and stigma, paving the way for exponential market expansion and industry growth. In South Africa the South African Health Products Regulatory Authority (SAHPRA) and the Department of Health are two government entities responsible for issuing both permits to grow and lisences to manufacture products from the cannabis plant.

So far a number of companies have been granted permits for medical cannabis in the country, but it still remains illegal to grow and sell cannabis products without the necessary permit and licenses from authorities, with the exceptions only applying to CBD products with specific conditions spelt our clearly by SAHPRA for those products.

However more than 30 countries have now legalised medical cannabis, and while precise laws remain patchy in many quarters, there are now half a dozen countries permitting adult use of cannabis. Hemp, once a darling crop globally is also experiencing a dramatic comeback.

“For years it seemed an impossible dream,” says Pierre van der Hoven, joint CEO of SilverLeaf Investments, a cannabis-focused fund focused on the industry’s local growth, which  two weeks ago announced the launch of the country’s first cannabis fund aimed at attracting even small investors to invest in this fast growing industry once fully regulated.

“Then, finally, legalisation as the ending of prohibition gained momentum globally. Today this fledgling industry is proving itself impossible to ignore; for any future-forward investor, it would be a pity to miss the opportunity to be part of the current momentum.

Investment prospects aside, it is also an opportunity to be part of the creation and development of a whole new industry, one that is set to dramatically drive economic growth and fuel job creation. SilverLeaf Investments, established by industry pioneers and investment experts, has the goal of bringing investors and cannabis-industry investment opportunities together. The aim is to help steer this new industry,”  Pierre van der Hoven  said at the time of the launch of the fund.

.Edward Tsumele is Editor of Cannabis Business Africa/CBA

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