Weed regulations weeding out smaller firms
Starting July 1, marijuana retailers must meet strict safety requirements in order to sell. Because of these approaching regulations, smaller companies that grow in less regulated environments are selling for much cheaper prices.
The state policy gave all marijuana sellers a 6-month window to sell their products before being regulated for growth reasons. By giving them a head start, the government could see the industry take off in full effect without any obstacles for smaller growers and sellers.
However, many sellers are worried about the limited access to facilities to grow regulated marijuana. California only has 28 licensed testing facilities, yet it has hundreds of sellers – it is unlikely that they will all be able to share these and stock their inventory in a timely manner.
The more business-savvy retailers started testing their product at the start of the year so they wouldn’t face this bottleneck effect. Thus, this policy will likely edge out many small firms in the market – or at least initially.
Consumers are happy with the prices, as some stores have unveiled sales for up to 50% off standard prices, but they’re also unmoved by the regulations. After NBC interviewed many smokers, many of them admitted that they were not concerned about the safety of the marijuana they had been smoking for years.
One interviewer, Catherine Lanzarotta, stated, “I smoked pot for 40 years that wasn’t tested, from dealers on the street, and it smelled like anything from gasoline to perfume. So, I’ve never had that concern.”
The marijuana industry continues to grow as more states legalize it, but there is still a learning curve involved with selling it. The regulation will help weed out the smaller, less capable firms in the industry.
Featured image via Public Domain Pictures
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