New recreational cannabis markets are seeing quicker starts to sales

As public opinion changes and state regulators learn from those who have gone before them, the time it takes from the approval of medical marijuana by voters or lawmakers to the first recreational sales in a market is getting shorter.

That could bode well for new adult-use markets that take root in the months and years ahead. And it would stand in sharp contrast to states such as California.

That state was the first to approve medical marijuana in 1996 – thanks to a voter-passed initiative. But it took California another 22 years before cannabis retailers rang up the state’s first recreational sales in January 2018 – after voters passed another initiative.

By contrast, Massachusetts more recently made the leap from MMJ approval to adult-use sales in only four years.

The speedier launch of recreational markets is good news for industry advocates in Arizona, Montana, New Jersey and South Dakota.

Residents in those states are set to vote on adult-use legalization in November, although South Dakota residents will be voting simultaneously on the legalization of medical and recreational marijuana.

The faster launches also are good news for states that have medical-only markets but aspire to offer recreational cannabis.

A speedier market launch could be a blessing and a curse for cannabis businesses, however.

On the plus side, companies might not have to wait years and years to open. But they will need to be nimble and able to set up quickly. This will also mean having flexible capital and being well organized.

Meanwhile, existing medical dispensaries will have less time to dominate a market as the inevitable decline of sales caused by recreational products will come sooner than before. On the flip side, existing MMJ operators often still have the first crack at the recreational licenses.

A seismic shift in public opinion has helped make the difference.

An annual survey conducted by the Pew Research Center since 1969 shows that approval for legalization overtook opposition in 2009.

That trend continued into 2019, when 67% of respondents approved of marijuana legalization.

Public opinion aside, there is also much to be said for standing on the shoulders of those who have gone before you.

In the late ’90s, when opinion was still strongly against legalization, western states paved the path for medical marijuana – and, more recently, recreational sales – but it was a slog in states such as California.

Previously, vague language in ballot initiatives and laws led to lengthy court battles. That, in turn, helped shape policy for more recent attempts.

Early states also dealt with the brunt of the federal government’s attempts to slow the process. The U.S. Drug Enforcement Administration raided medicinal marijuana providers in California for years after the state approved the production and use of MMJ.

Even if legalization happens quickly, it can still take years for recreational markets to get up and running for the first rec sale.

While Illinois launched recreational sales less than a year after passage, Massachusetts and Michigan took almost twice as long. And Maine is set to launch recreational sales next month – four years after voters there approved adult-use cannabis.

Andrew Long can be reached at [email protected]