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The Future of Cannabis Delivery

Canada’s largest market for adult-use cannabis sales, Ontario recently uncovered new details about the permanent program for cannabis retail delivery and curbside pickup, beginning this March. Ontario previously announced in October 2021, the plan to make delivery and curbside pickup permanent, after it was allowed during certain time periods during COVID lockdown. However, cannabis retail outlets will not be allowed to operate entirely or be predominantly focused as a delivery-based business.

Additionally, High Tide announced this week that it will begin offering on-demand delivery out of select dispensaries across Canada. The service will be referred to as “Delivery on Demand” and allows customers to order online and have their CBD products delivered within two hours, or within a scheduled hourly time slot of their choice. The offering will begin out of Canna Cabana locations in Ontario, Manitoba and Saskatchewan initially, with plans to develop the service to all locations over time.

The US is a different story, given many states and jurisdictions operate under varying laws. Recently, a judge in Washington state ruled that a retail marijuana company violated state law by using a cannabis delivery service. In using a delivery service, the retailer violated state law by welcoming the transport company to enter its stores, according to the state’s Liquor and Cannabis Board. Now it is crystal clear, licensed retail stores that either deliver cannabis themselves or facilitate a third-party transport service are in violation of a handful of state regulations.

Meanwhile in California, there are many opportunities for delivery services. Recently a group of small cannabis farmers from Mendocino County introduced a new online sales and delivery platform to provide Sacramento area residents cannabis products. Products purchased through the platform provide a 90% return of the retail price back to the farmer after applicable taxes. This is double the profit per retail unit that most small farmers currently receive.

Furthermore, the California Department of Cannabis Control (“DCC”) is undertaking new cannabis rulemaking pursuant to the Medicinal and Adult-Use Cannabis Regulation and Safety Act. It has been proposed that delivery employees can now carry up to $10,000 worth of product and the limit on the amount of unordered product they can carry while in transit will be removed. Curbside delivery is also going to be allowed (except for delivery-only retailers).

Its not just on the west coast – Connecticut licensing programs allows for delivery services directly to consumers. The ability or inability to deliver cannabis products depending on state regulations, ultimately impact consumers and how they can purchase product. More established companies are getting into delivery services and will set themselves up to compete as federal and state laws change over time.

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