The "Spice" Trade: A Profit Estimation of EU Online Vendors of Herbal Smoking Mixtures. (September 2018) - Surmont, Tim
There are currently over 170 synthetic cannabinoids monitored by the European Union Early Warning System, making it the single largest group of new psychoactive substances, often marketed as "legal" replacements to cannabis. The Internet, coupled with cheap and efficient shipping, has allowed countries like China and India to become the chemical and pharmaceutical wholesalers and retailers to the world. These companies ship synthetic cannabinoids to Europe, where they are processed and packaged into a range of products, smokable herbal mixtures being the most common one. The herbal mixtures, often referred to as "Spice, " are then sold via online shops on the surface web, using sophisticated marketing techniques, potentially generating high profits. We decided to use available data on the synthetic cannabinoid 5F-MDMB-PINACA to estimate those profits. After making an inventory of the required materials and the typical retail price, we made a lower and upper bound profit estimation. We found that the return on costs varies between 3.3 and 24.4 after the first production and rises to a range between 5.5 and 42.5. By applying a basic economic model, our estimations show that profits in this type of business are substantial.