Economics of a Bogota Drug Dealer

Posted on 25. Feb, 2012 by in colombia

Alternate Title: How to Sell Cocaine in Colombia

Last year I published the macroeconomic cocaine industry in Colombia article, Cocaine Cartels and Economics in Colombia. This year we’ll take a look at the microeconomic level. In the spirit of Freakonomics writer Sudhir Venkatesh reporting on a Chicago street gang’s economics selling crack, I’m delivering a less in-depth look at a Bogota drug dealer’s business.

Note: I’m not going to introduce you to Dopeman. Do NOT contact me for drugs.

For this article I interviewed “Dopeman,” a mid-level drug dealer.

There are different ways to sell drugs in Colombia. You can avoid most trouble by catering to tourists and always moving around like my buddy Gustavo. You can sell in the street, or join a gang that sells in a specific neighborhood – both of which are much more dangerous. Dopeman’s method centers around maintaining a low profile in Chapinero, a crowded neighborhood where people are constantly coming and going.

For practical purposes, 1 US Dollar = 2,000 Colombian Pesos (2000 pesos = $1).

(All prices are in Colombian pesos)

Cocaine

Cost of a kilo: $3,200,000 COP
Cost per gram: $3,200
Price per gram: $10,000
Profit per kilo: ~$7,000,000

LSD

Cost of a carton (25 hits): $200,000
Cost per hit: $8,000
Price per hit: $20,000
Profit per carton: $300,000

Ecstasy

Cost of 20 pills: $120,000
Cost per pill: $6,000
Price per pill: $20,000
Profit per 20 pills: $280,000

Cripy (high-quality marijuana)

Cost of pound: $500,000
Cost per gram: $1,100
Price per gram: $5,000
Profit per pound: $1,750,000

LSD, ecstasy, and cripy come ready to sell. But Dopeman’s cocaine comes in liquid, the form mules carry because it’s easier to swallow. So Dopeman’s connection is a lab fairly high in the supply chain. To convert it from liquid to powder, he simply pours it onto a plate and sets it under a UV light for a day or two. Once dry he chops it up.

Any coke dealer will tell you they don’t cut their cocaine (mix it with other stuff to make it weigh more). Dopeman is the one I believe given its purity. He charges 10,000 / gram, a higher price in Colombia. He says dealers who cut it usually use baking soda or an over the counter pill that has a numbing effect. Cocaine’s also sprayed with acetone to weigh more. When Colombians snort coke they deem to be low quality, they say “¡Acetona!” It’s like saying “garbage” or “no good.” Dopeman says acetone is used in the original processing, so all cocaine has a little acetone smell. It’s impossible to get acetone-free cocaine, but I wouldn’t know.

An important part of selling drugs in Bogota is moving product around the city – drugs and guns. It’s important to have taxi drivers you trust. They have prices for everything, but the key is to get a driver who won’t stop if the cops try to pull him over.

Profit Breakdown

Dopeman’s profits break down as follows:

Cripy 35%
Cocaine 25%
LSD 25%
Ecstasy 15%

I was surprised Cripy was his most profitable product. In the States, the highest-earning drug dealers sell cocaine, a function of the inflated price.

Core Competencies

I asked Dopeman the two most important core competencies for success in this business.

1) Networking – always meeting new people. This is crucial for (A) gaining new suppliers with higher quality or lower prices, and (B) expanding the client base.

2) Maintaining Respect – not allowing haggling, negotiating. You can’t let people think they can handle you or they will. Set ground rules with clients, such as not showing up at the house unannounced. And of course not seeming like an easy mark to rob.

Violence a Part of the Business

Violence is an assumed core competency in any illegal business. Dopeman has a few knives, a 7 mm Beretta, and a .38 revolver. He had a taser for a while but lost it. Three times he’s had to track down customers who were ignoring their debts and pull a gun, two of which he did alone and one he did accompanied by three friends.

One night Dopeman attended a party in Restrepo, a South Bogota neighborhood. He made friends and sold some bags. Then a local from the neighborhood asked him to step outside. A couple others were waiting out there, and one showed a pistol. They told him he wasn’t to sell cocaine in that neighborhood.

I asked if Dopeman ever went after someone who he thought was competing for his business. He said he never has because given his quality and pricing, he doesn’t lose clients. Plus, Chapinero is so big, so busy, and so uncontrollable that nobody tries to claim it as their own.

Once I was over at Dopeman’s place and there were no less than ten deported Colombians from America over there. Not one girl, but ten of these Latin King type gangsters. I noted it’d be difficult to rob this house.

During our interview Dopeman said someone did try to rob him once. They came when it was a full house, as it often is. Two guys came, one with a pistol and the other with a cattle prod, and when they saw the situation they quickly backed out and left.

There was an attempt on Dopeman’s life. He’d been selling coke out of a Chapinero bar. A local gang got jealous. They weren’t jealous because he was taking their customers. They were a gang of thieves who smoke crack in la L. They were just jealous. One of them went after him in the bar with a knife. One of Dopeman’s friends saw the knife and knocked him down. The crew jumped on the would-be assassin, killing him right there in the bar. In Dopeman’s words: “That nigga got killed with knives, bottles, chairs, hands, feet … That nigga got mutilated.” There wasn’t much of an investigation. Dopeman was willing to tell police what happened, but they didn’t call him for a week. Even after they called, he never went in to talk and they never came to his house.

A friend of Dopeman’s, another deported Colombian from America, was killed for selling drugs. A Cali gang deemed he had taken away some of their business and shot him four times in the head. In the Colombian drug business, life is cheap. It takes a lot less to get killed than in the States.

International Cocaine Trade

The most profitable way of making money off Colombian cocaine is getting it into the US, Europe, or Australia. Fittingly, the most difficult part is getting it into Gringolandia – whether it be by air, mail, foot, speedboat, submarine, whatever. If you can’t get it in, you’re not in business.

Since meeting a bunch of deported Colombians, I’ve been offered to carry twice. International traffickers pay a premium for gringo mules since Colombian passports draw extra scrutiny. Gringos are more likely to get the dope through. The going rate is $6,000 – 10,000 USD depending on how much you can carry on a plane, which depends on how big you are. In addition to your fee, they pay for your flight and any necessary documentation. The second offer I refused included a week vacation in Barcelona.

I’ve received two hard sells, two soft sells. So technically four. I asked how often he’s asked for mules and Dopeman replied without hesitation, “Daily.” Mules are ALWAYS needed. Especially gringos with blue passports.

Watch the award-winning Colombian film Maria Full of Grace, which depicts girls swallowing dedos, the small rubber tubes of cocaine. One burst dedo would result in certain death. So they put three coats of wax on each one. Nobody I know has heard of a swallower dying. But they get caught and face long prison sentences.

Dopeman knows two gringos who got caught muling coke through airports. One was the guy’s first time. He got nervous on the plane. When he arrived in Spain he turned himself in voluntarily at customs. He probably got a light sentence, but the Colombian traffickers are understandably pissed and want him dead. It’s safe to assume he won’t come back.

The second gringo was set up. He’d done it several times successfully with Dopeman’s associates. He got comfortable with the operation. Then he went partying in Cali and met some new traffickers. He agreed to mule for them. He was caught and is currently serving time in a Scandinavian prison. Dopeman believes he was set up by the caleños. He says traffickers sometimes tip off the authorities on one guy so others are sure to get through. The fall guy probably didn’t swallow 100% cocaine. Dopeman says the paisas may be the least trusted, but “them Cali niggaz are grimy.” They don’t give a fuck who goes to jail as long as they get their dope through.

Dopeman estimates mules get caught at a rate of 15%. FIFTEEN PERCENT! 1 out of 7 – that sounds really fuckin’ high to me!

True Capitalists

In My War on Drugs Rant I argue against the futility in combating drug traffickers. I’ll take that position further to appeal to any right wingers, “Austrian” economists, and laissez faire advocates. Selling illegal drugs is the ultimate free market. There is no government regulation, litigation, trademark protection, contractual enforcement – NOTHING. It’s free market capitalism to the extreme.

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Cocaine industry music:

Rick Ross – Hustlin’
1st rapper to say “I cut ’em long, I cut ’em wide, I cut ’em fat…”

UGK – Pocket Full of Stones
RIP Pimp C

Dru Down – Ice Cream Man
Original ice cream man bringing humor to the cocaine industry

Clipse – Grindin’

http://www.youtube.com/watch?v=JFJpwBTpkLY

Master P – Ghetto D

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6 Responses to “Economics of a Bogota Drug Dealer”

  1. matthew b

    26. Feb, 2012

    “them Cali niggaz are grimy.”

    Haha! Alot of Cali and Buenavetura cats here in Htown. I’ve never had any type of business dealings with them but yea, they do look grimy as hell.

  2. Dan Sanchez

    27. Feb, 2012

    You could think it is a free market in one sense because the government doesn’t regulate it at all on the black market by the fact that it’s illegal. Yet it is these very regulations that force it to be a free market. It is one could say an imposed free market with lots of costs (for security, etc). You can see the high costs and paranoia of the drug war especially when you have kin working for the DEA. They used tinted-glass windows, blocked numbers and are always on the lookout for drugs, etc.
    I dislike this version of the free market. I would on the other hand like it to be on the other end of the spectrum, legalize everything and tax it like hell. The number of addicts would spike and there would be a lot of collateral crime-related offenses with the need for junkies to pay for their shit. I would rather treat it as a medical problem and set up clinics where people could get their drug of choice and ride out their high, trip, whatever. It’s a Pandora’s Box where you would have to radically rethink all of our current approaches and throw it out the window. But I’d rather see that than all the drug-related violence and corruption that it brings to the state. If it’s a choice of two evils, I choose the lesser one and go with an addiction boom rather than a continued cycle of violence.

  3. Montaigne

    28. Feb, 2012

    A couple of years ago I collected data on alcoholism from a few different countries, namely Norway, USA, Spain, Germany and Colombia.

    Access (prices, regulations, opening hours, age limits, etc) and useage (cultural norms, acceptance, etc) are vastly different in all those countries, yet the levels of alcoholism hover around 4-5%. One more fact, in strict and conservative Norway (on this topic) smoking weed/hash, which is very expensive, is much more common than in the liberal Netherlands.

    My fantastic scientific point? I’m not sure access and prices has anything to do with the magnitude of the usage.

    It seems more to be an issue of genetical predisposition and human psychology in function with culture.

  4. matthew b

    12. Mar, 2012

    http://www.youtube.com/watch?v=ErkceKhcCLI&feature=related

    I thought of this blog as soon as I heard this song.

  5. Colin

    30. Mar, 2012

    Dan, I agree with just about everything you said. Including that it’s undesirable for a market to be that unregulated. Even tea-partiers would admit that to do healthy business, they need the rule of law, property rights, contractual enforcement, etc.

    Montaigne, I agree with you that genetic predisposition and psychology play a huge factor, but I think access and prices do too. If they didn’t, Krokodil wouldn’t exist. Scary shit!

  6. Rawley

    09. Apr, 2012

    Jesus this Krokodil is fucking disgusting…just take these people out and shoot them in the head.

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