It’s been four years since recreational marijuana became legal in Washington. With the November election, four more states have jumped on board: California, Nevada, Maine, and Massachusetts. And now, these states are looking for advice.
This was an industry that needed to be built from scratch. And Washington -- along with Colorado -- is an early adopter when it comes to legal pot.
David Rheins is the director and founder of the Marijuana Business Association and he says people getting into retail could quickly go from zero to a half million dollars a month in sales, because of the pent-up demand. He likens it to the emergence of dot-coms, except for the federal prohibition.
“It’s everything you would do to be an entrepreneur, to do a small to medium start-up,” said Rheins. “Plus you have to be compliant; plus you have to figure out alternative financing strategies; plus you have to build the airplane while we’re flying it.”
In a word, that is marketing; establishing what the products are and then engaging the consumer. In fact, the market is getting so sophisticated that people are starting to respond to brands they recognize.
“So advertising is very important, but so is product education, particularly around products that are evolving very quickly, things like concentrates, or oils, or vapes,” Rheins said.
Reins says despite the success of retailers in Washington, there are still social issues that they have to navigate, and that will be the case in states like California.
“Getting a location, getting financed, finding a neighborhood, and getting those local permits — and that takes a long time for these communities to say, ‘OK, it’s OK in the state but not in my backyard,’” he said.
With more states saying yes to legal marijuana, Reins says the federal government will eventually have to change its regulations. If that happens, analysts predict cannabis will be a $50 billion business in the next decade.