Couriers speed through the streets every day, delivering important documents, letters, and packages to New York businesses and residents. Soon, couriers could be delivering more than Chinese takeout and paperwork. They could be allowed to drop off cannabis right at your front door.
Plans are in the works to fast-track a seamless cannabis delivery service to jumpstart New York’s legal cannabis sales. The prospect for recreational sellers is exciting, but New York’s legal recreational marijuana launch has been slow to get off the ground. What makes cannabis delivery different, and can it bridge the gap in sales until retail locations can open their doors?
New York and Retail Cannabis Licenses
New York became the 15th state to legalize the use and sale of recreational marijuana in March 2021. Only in November of 2022 did the state’s cannabis regulatory board approve 36 retail cannabis-selling licenses. For many eagerly anticipating the arrival of legal recreational marijuana products, the process of approving vendors feels achingly slow. State officials say they chose the 36 license recipients from a pool of 903 applicants.
The officials with the state and the Cannabis Control Board have repeatedly said they want to get legalized cannabis sales right. By examining early attempts at legalization, New York hopes to avoid the pitfalls of growing too quickly. The state also wants to prioritize health and safety, ensuring that retailers sell high-quality and safe products. It also wants to prevent marijuana from landing in the hands of individuals under 21. That has meant a lengthy applicant review process and extensive training for potential entrepreneurs and retailers.
The slow and methodical rollout of retail licenses leaves some entrepreneurs feeling frustrated. Unauthorized and illegal popup shops seem to be thriving, taking away business from cannabis sellers that play by the rules. These retailers cannot legally sell marijuana and cannabis products, but they do so in an attempt to capitalize on the demand for marijuana. In response to the frustration and to divert sales from unsafe retailers, the state Office of Cannabis Management has a new plan.
Launching Cannabis Deliveries
A spokesperson for the Office of Cannabis Management recently announced a plan that would allow some selected, licensed retailers to begin cannabis delivery before they are permitted to open storefront locations. New cannabis operators can fulfill cannabis delivery requests from a specified location obtained by the licensee and approved by the Office of Cannabis Management.
The move is applauded as a positive step forward for the slow-to-grow recreational cannabis industry. Currently, there is at least $750 million worth of marijuana sitting in New York warehouses. Cannabis farms are churning out products, but that product has nowhere to go until retailers are permitted to open for business. In the meantime, cannabis continues to pile up, and cultivators worry about the condition and preservation of their crops. Growers are just as eager to show off their products as retailers are to sell them. The accelerated rollout of cannabis home delivery may help rev up recreational sales and combat the glut of weed sitting in storehouses.
Hurdles to Overcome with the Delivery Process
Although the excitement about cannabis delivery in the state is palpable, there are still challenges to overcome. The Office of Cannabis Management laid the initial groundwork for what cannabis delivery service might look like before issuing retail licenses. Proposed regulations stipulate that businesses would be limited to delivery through ground transportation. Upon delivery, the purchaser would also be required to provide proof that they are at least 21 years old. Additionally, retailers would be limited to no more than the equivalent of 25 employees making paid deliveries.
There are other hurdles to tackle thanks to marijuana’s federal status as a Schedule I illegal substance. Similarly, other states have to grapple with marijuana payment issues since banks and credit card companies do not participate in the cannabis economy. Most retail locations in other areas of the country require cash payment, with some expanding to accepting debit cards for recreational marijuana transactions. New York’s delivery-based system would be no different. Transactions would have to be completed with cash or a debit card. This payment system could potentially impact the safety of delivery workers traveling to and from locations carrying large sums of cash. Discussions over courier safety may be an issue retailers will need to address.
One benefit of the delivery program is that although New York cannabis licenses are assigned by county for retail operations, retailers will be allowed to sell and deliver cannabis across county boundaries. Brooklyn is the only community where delivery will not be permitted since a judge blocked retail sales in the area.
The Response from Retailers
Many newly licensed retailers have been caught off-guard by the seemingly surprise delivery announcement. One family-owned partnership is scrambling to re-work the family business plan. The family says they were not expecting to launch delivery service before the opening of their storefront, but the change is welcome. They contend that doing something is better than waiting in the wings while illegal weed popup shops siphon off business from licensed cannabis sellers. It takes time and resources to open a store, while in comparison, it takes very little infrastructure to put the wheels of a delivery service into motion.
It should come as no surprise that cannabis is getting the delivery treatment. Couriers crisscross New York City daily with everything from legal documents to takeout. In the coming weeks, it may be possible for residents to get weed delivered right to their homes, like pizza or eggrolls. State officials hope greenlighting recreational marijuana delivery will help stem the tide of unauthorized weed sellers and hold purchasers over until legal retailers can get their footing.