New York state legalized adult-use cannabis this spring, but how sales will actually roll out to this massive market presents another set of questions — questions with an estimated $4.6 billion in annual sales at stake.
“The passage of New York’s Marijuana Regulation and Taxation Act is the first step in this journey,” write portfolio manager Timothy Seymour and Feuerstein Kulick LLP’s Jeff Schultz in an op-ed for CNBC. Here are the next steps they recommend to ensure the fledgling industry’s success.
Get growing, set up delivery
To fight the illicit market, Seymour and Schultz warn that New York state needs to fast-track cultivation licensing. Because it can take about 18-24 months to get a cultivation facility up-and-running (and Canadians and many legal states are all-too-familiar with this), some markets have experienced shortages when sales are legal.
And New Yorkers like their cannabis: ”One study estimates that New York City consumes 77 metric tons of cannabis annually – more than any other city in the world.” That’s why they also advise regulators to set up delivery methods and licensing now. New Yorkers are used to convenient delivery — it’s a must to compete with the illicit market.
Carve out support for equity operators
As we’ve seen in several US states, lack of access to capital can make it difficult for people who qualify for equity licenses to execute their visions.
That’s why the authors recommend state-supported incubator programs, partnerships with business schools and low-fee service providers be made available before sales are legal. This will “empower a formidable network of successful minority operators who can serve as the cornerstone of a virtuous cycle of bringing tangible, intergenerational wealth back to the communities that have been ravaged by the war on drugs.”
We couldn’t agree more.
To stay up-to-date with what’s happening in New York – join us and our partners at Prohibition Partners for Business of Cannabis: New York. Learn more and stay connected.