CBC in the Media: CBC's Ziering Interviewed on InsideSources

Another Sign Cannabis Is Becoming A Mainstream Business: Collection Agencies

From InsideSources by Erin Mundahl


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How does a cannabis company collect on unpaid bills? While unpaid consumer credit card bills often fall to retail collections companies, businesses need to turn to other types of collection agencies. Cannabis businesses are no different, except that their industry is newer. Cannabis collections is becoming a need for companies that are transitioning from a small business model to a corporate structure.

CannaBIZ Collects, a Florida company, is the largest collections company specializing in the cannabis industry. A collaborative effort between partners Cody Ziering and Brett Gelfand and commercial collection attorney, Ross Gelfand, the company is one of the first to address the growing need for cannabis collections services.

“Cannabis is an interesting type of market,” Ziering tells InsideSources. “When Colorado first opened recreational sales in 2014, it was pretty much mostly mom and pop shops, maybe one or two dispensaries specialized in grow. As the industry has started to grow and more and more outside investors have come in, lot of businesses have started to go from the mom and pop style company to more of a corporate type organization.”

Many of these collections started out as small, short-term loans between businesses. Ziering, who entered the cannabis industry by building a vertically integrated Colorado cannabis firm, describes how they would make semi-weekly deliveries between Aspen and Denver, Colorado.

“We ended up becoming a lender just by natural process,” he explains. “We would drive product from Aspen to Denver, three hours away and in Colorado there is a rule that cannabis cannot stay on a truck for more than a day…so we would have to drive out to Denver, perhaps the manager or the person with access to the cash wouldn’t be there and we had $10,000-$20,000 worth of cannabis product that we didn’t want to drive back.”

He explained that in this situation it was often easier to agree to collect the money owed on the following delivery run. These types of short term credits are very common in many industries. Now, CannaBIZ works with companies to help ensure that these credit situations are properly resolved. All of this is part of the industry’s transition from small businesses to a corporate model.

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“The cannabis industry is evolving from a mom and pop type deal, where everything was done on smiles and handshakes, to more traditional, more corporate practice,” says Ziering, “which is why you are seeing credit terms and those types of things happening more, because these are standardized practices in every other industry.”

This means that CannaBIZ sees a wide range of clients working in everything from whole growing to vape production and consumer product sales. Ross Gelfand, who worked in corporate collections law for 30 years before helping to start CannaBIZ, handles many of the claims directly, with the goal of developing a payment structure that pleases both creditor and debtor.

Collections can easily bring to mind harassing phone calls and burly repo men. To Ziering, collections are a sign of increased debt, and that itself is a positive sign for the industry.

“The more debt you end up seeing, then the more they are growing,” he said. They have already seen past debtors return as future clients–something that also demonstrates the more relaxed attitude of the cannabis industry.

In fact, CannaBIZ is more likely see a specific business struggling, perhaps with multiple claims piling up against the same grower or dispensary, rather than industry-wide struggles. As a company, their goal is never to bankrupt a borrower, but to find an acceptable resolution. In this, the more relaxed attitude of the industry is helpful.

“We’re not trying to punish anyone. It just, hey, you owe something and let’s get it paid and let’s get past it,” said Ziering.  “In cannabis, everyone is much more friendly, much easier to deal with.”