Today's cannabis spotlight features Kimberly Stuck, founder and CEO of Allay Consulting, a compliance strategy and services provider that works nationwide in the hemp and cannabis space.
What are the most common compliance mistakes you see businesses committing?
We work in all states so this one is kind of hard to answer simply. I think that the common mistakes we see have to do with a company not being proactive with their compliance. It is important to not only be compliant with the standards you know, but to know what could be coming in the future, such as FDA, OSHA, and cGMP compliance. The most costly mistakes I have seen in my career have always been food safety based (contaminated products needing to be disposed of or recalled) and OSHA violations. OSHA and public health really matter, even if no one is coming into your facility to regulate on a regular basis. We really preach the need to be compliant with already existing FDA and OSHA regulations, because these departments can come in and fine or close you at any time if an event or complaint occurs. These kinds of visits can be devastating to a company if they are not ready.
How has Covid-19 impacted the industry, specifically in terms of compliance and operations?
There are fewer regulators going into facilities, leading to more relaxed attitudes regarding compliance. Once things open back up it will cause lots of problems for those facilities that have become lax, because employees will not be used to being regulated anymore. Many of our clients have hired us to perform mock audits so that their teams are used to being inspected even though the regulatory bodies aren't coming in very often. I have also seen a huge uptick in the number of OSHA visits due to complaints in the THC and hemp industry. If an employee doesn't feel that the working conditions are safe, or is being forced to work with sick people, then they will be more likely to call in a complaint. OSHA then makes a site visit and most of the time will fine huge amounts because these companies aren't compliant with any OSHA standards at all, regardless of if the complaint was substantiated or not. This has put a lot of companies in major financial strain, and some have even been shut down. This is why we stress the need to be proactive instead of reactive when it comes to consumer and worker health and safety regulations. Better to implement these standards now than to be forced to do it and pay a bunch of fines.
What advice do you have for business owners looking to get into the cannabis industry?
When you are planning your budget and writing your business plan, take into consideration where you want to see that business in 5, 10, and 20 years. Plan for the future and an exit strategy that includes compliance. For example, acquiring certifications like cGMP can mitigate risk and investors and buyers love to see that. Getting ISO 22000 certifications will make it easier to sell to other countries if you want to be included in the global market eventually. It all depends on where you want the company to go. If you want to expand your business and stay ahead of the competition these things will be necessary to compete, so budget for them in the beginning. The sooner they are achieved the better your company is going to do.
Where do you think the cannabis industry is most lacking in 2022?
Regulations are constantly changing and have been since the beginning, but I am looking forward to seeing some of the states even out in terms of state requirements. Obviously there are some states that are just coming online, so it will be a while before the regulations stabilize in those states, but in more mature state markets it feels like they are becoming more solidified and less movement is happening. I think that where most of the industry is lacking is public health compliance. Many state health departments still aren't regulating cannabis products at all and that is a bit concerning. I think we will see more health department interaction in the coming year as Covid hopefully calms down and more departments have the bandwidth to inspect these businesses.
Personally, what obstacles have you had to overcome in creating a successful, sustainable business?
We have been very fortunate at Allay Consulting. Our reputation and the continued trust of our clients has kept us busy throughout the pandemic, but we have still had our struggles. We have moved to a completely virtual platform, so everything we offer including audits and training, we can now do via FaceTime or Zoom. It has not only helped many of our clients stay compliant throughout the pandemic, but has also saved them money on travel as well. We love what we do, and if we can find more efficient and affordable ways to work with our clients, we will do it.
More about Kim:
Kim Stuck is the founder and CEO of Allay Consulting, a compliance strategy and services provider serving the hemp and cannabis industries nationwide. She brings a regulator’s keen eye and wide-reaching knowledge on evolving compliance and safety mandates to support businesses in tightly regulated industries. Previously, Ms. Stuck held a pioneering role as the nation’s first cannabis and hemp specialist for a major metropolitan public health authority. During her tenure with the City of Denver, home to hundreds of cannabis businesses, she worked as an investigator covering cultivation, manufacturing and retail. Her duties included facility inspections; conducting investigations into improper pesticide use and worker safety; creating regulations; instituting recalls; and public outreach. Ms. Stuck holds numerous accreditations, such as certified quality auditor (CQA) and certified professional of food safety (CP-FS), among others. In addition to serving on several industry advisory boards, she has been a member of ASTM International’s cannabis standards committee since its 2017 inception.