Long Beach — Bicyclists and pedestrians pass Belmont Shore Natural Care, a dispensary raided as part of an investigation into seven medical marijuana stores allegedly controlled by a San Clemente resident.

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PHOTOGRAPH BY: GENARO MOLINA / LOS ANGELES TIMES

Medical marijuana money

• Posted By: Jerome Adamstein
• Posted On: 6:25 p.m. | June 16, 2012

An entrepreneur looking to open a new marijuana store in downtown Los Angeles envisioned his business model in simple terms.

He would buy bags of buds from growers for about $3,200 a pound, divvy up the product and sell it over the counter for $15 for a gram – more than twice what he paid. Since even small dispensaries often sold a pound a day, he expected to make at least $3,000 a day in gross profit.

He’d pay a few employees $10 an hour. Rent and utilities should cost no more than $4,000 a month, advertising a little less. He would have to put a lawyer on retainer, buy furniture and install a security door and check-in window.

After all that, the 32-year-old former mortgage broker still thought he could clear half a million dollars his first year, easy.

Medical marijuana providers invariably present themselves to the public as “compassionate caregivers,” taking great risk for patients who are in turn asked only for “donations” and who would otherwise have few options to get their medicine.

But many pot shops have been making big money, sometimes extraordinary money, mostly in cash, even as they claim to be nonprofit. “I believe marijuana really helps people,” said the entrepreneur, who had owned a dispensary briefly before the city shut it down. “But no, I’m not doing this for free.” See story