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Will 2021 be the year of cannabis delivery?

Will 2021 be the year of cannabis delivery?

Cannabis delivery could become more available in 2021

With more sales than any other year and demand for cannabis higher than ever, will 2021 be the year cannabis delivery becomes widespread?

2020 was a difficult year, as if that even needs to be said. But there was one thing that helped millions of Americans get through the year.

Cannabis.

That’s not an exaggeration either. Americans bought 67% more cannabis in 2020 than the year before to deal with the stress of COVID-19, record unemployment and peak division in the country.

However despite the huge increase in sales, only a handful of states offer delivery options for recreational cannabis consumers.

Cannabis Delivery

Arizona, Arkansas, California, Colorado, Maine, Maryland, Massachusetts, Michigan, Nevada, New Mexico, New York, Oregon, Rhode Island and Vermont, are all technically states that offer some form of delivery service for consumers.

Strict regulations and limitations however have made it so only a few of the states listed actually have a current, implemented delivery system. For example, Massachusetts has been dealing with resistance to their new delivery rules, with the cannabis dispensary association in the state going so far as to sue. Colorado, while passing a law allowing delivery in 2019, has yet to implement it for medical patients, while recreational consumers might have to wait until 2022 for access to the same service.

Other states in the list have only recently legalized medical or recreational cannabis with inclusions for delivery in their legislation. These states such as Arizona, Arkansas, New Mexico and others, while passing legalization bills in 2020, have yet to begin sales of cannabis in general, meaning delivery also hasn’t begun.

The question that a lot of consumers are asking, especially after going through a year of the country’s worst pandemic since the early 1900s and bolstering cannabis sales like never before, is where the hell is the delivery option?

COVID and cannabis

The impact of COVID-19 on businesses across every industry in the country has been stark. Yet while thousands of businesses suffered and even closed down, cannabis businesses everywhere thrived. But almost every single sale was done in-person.

This doesn’t seem to fit the overarching narrative of the last year that social distancing and avoiding others is all but paramount. In this same time Drizly, an alcohol delivery app, became available in 26 states.

In other words, half the country can get alcohol delivered to their door, yet only a couple states allow those with legal access to cannabis to have it delivered. And that is all missed revenue. Bud.com, a delivery service that operates in Northern California, experienced a 500 percent increase in sales after lockdown orders in mid-March, according to Dean Arbit, the chief executive of the company.

So if there’s no shortage of evidence that cannabis delivery can be highly profitable, what are we, or more accurately, what are states waiting for?

Will 2021 be the year?

The events (and profits) of 2020 definitely have more states and cannabis businesses talking about delivery. With no end to social distancing and COVID restrictions in sight, we should expect cannabis sales to continue to grow through 2021, with demand for delivery options growing as well.

Similarly to legalization in general, no state has the same cannabis delivery laws. In other words, there is no single template for states to follow that has seen continued success. Like legalization, some states may be waiting to see another implement delivery successfully from the start, and copy them.

Other states have issues with the laws they already have, such as competition against brick and mortar stores in states that allow delivery straight from distribution centers.

There is little doubt the more states will legalize some form of cannabis delivery in 2021. To expect every state with recreational or medical cannabis to make it available however is a big ask. One that is highly unlikely to happen in just one year.

But if there is any way to describe the cannabis legalization movement, it’s unpredictable.

Can Massachusetts Recreational Cannabis Survive Coronavirus?

Can Massachusetts Recreational Cannabis Survive Coronavirus?

What happens to a federally illegal business during a national pandemic?

We are all about to see what happens in real time. As Coronavirus rapidly spreads across the United States, businesses everywhere are shutting down.

Restaurants are only doing delivery and takeout, and the only other businesses allowed to operate are those marked as “essential”. Doctors offices, pharmacies and grocery stores are understandably essential, but states are also marking liquor stores and cannabis dispensaries essential.

But not all dispensaries are so lucky to get the essential treatment.

The dispensary dilemma

Nobody would really argue that medical dispensaries are not essential. Medical cannabis users must get a doctor’s recommendation to use it, making cannabis their medicine. But recreational cannabis dispensaries are a whole different monster.

Different taxes, different regulations, different requirements. Recreational and medical cannabis, though identical in actual product, have been split into two different industries due to the progression of cannabis advocacy. While medical cannabis is just that, medicine, recreational cannabis has been put in line more with alcohol.

But while those who suffer severe alcohol addiction can actually die if they don’t have alcohol — presumably the main reason liquor stores have been deemed essential — recreational cannabis users can go cold turkey relatively easy with little side effects. And that’s why they haven’t been deemed essential in several states.

Although California and Colorado, among others, have deemed all cannabis businesses essential, Massachusetts has made headlines for shutting down all recreational cannabis sales. While it might not seem like a big deal considering hundreds of businesses have had to close down, there’s one crucial difference between recreational cannabis businesses and all others; federal legality.

No federal assistance

The Coronavirus pandemic has changed the way we all live and will live for quite some time. With a lot of businesses being forced to close, many have resorted to lay-offs, furloughs or completely closing down. In an effort to support small businesses, Congress passed the Coronavirus Aid, Relief and Economic Security (CARES) Act on March 27.

The legislation provides economic assistance to small businesses, in the form of interest free loans, a paycheck protection program and more. But this is a federal program, and a business that is considered illegal on the federal level can’t receive help from federal programs.

In other words, cannabis businesses both recreational and medical cannot receive any government assistance from the federal government. So while medical dispensaries have been deemed essential, recreational dispensaries in states like Massachusetts have not. So they are forced to close with no government assistance, leaving them with no option but to close down, lay-off or shut down completely.

To simplify, recreational dispensaries in states like Massachusetts are up shit creek without a paddle.

Can recreational cannabis survive Coronavirus?

Most recreational cannabis businesses might just have to tighten up a little bit over the next couple of months in most states. But the future is cloudy for recreational dispensaries in Massachusetts. If they can’t operate at all, they can’t make money, can’t pay rent on their location, and eventually can’t keep the business running.

It would be speculation to say that the governor of Massachusetts is doing this because of his lack of support for legal cannabis — even though it took Massachusetts over 3 years to open a recreational cannabis dispensary after legalizing in 2016 due to plenty of barriers — but it’s not hard to imagine a government official using a position of power to punish an industry they do not support.

Unlike other small businesses that might have to close down but can still receive government support, recreational cannabis dispensaries are pretty much on their own to make it through the Coronavirus pandemic, with no clear end in sight. It took four years for Massachusetts to get up and running with recreational cannabis, and it only took two weeks for the state to shut it all back down.

While the future is unclear, it’s going to be a tough road ahead for all cannabis businesses in the United States.