With California joining the pot of states legalizing utilization of recreational marijuana, most companies inch even closer to offering full online sales and delivery of cannabis. Meanwhile, other services make use of the web to facilitate marijuana distribution in different ways.
When it comes to e-commerce and cannabis, there’s plenty of gray mixed in with the green.
The rapid and quickly spreading legalization of cannabis is leading savvy entrepreneurs to launch services making it more convenient for shoppers to pick and choose from a number of strains, compare prices and order their indulgences or medicine through the comfort of their couch, and then for dispensaries to discover and buy the products they are going to resell.
However, marijuana sales are largely stuck at “almost e-commerce,” says Alan Brochstein, founding father of 420 Investor, a subscription-based portal for investors offering data on marijuana companies, and of New Cannabis Ventures, a content aggregation site for your cannabis industry. That means consumers can order online for get with a dispensary or get cannabis delivered but then have to pay cash at the door.
An Amazon-like site for cannabis is a good idea, and it’s not new, but the current federal illegality in the herb helps make the idea challenging to execute, says Brochstein. Each state has different laws surrounding the purchase and utilize of order marijuana online. “It’s difficult to scale when you are state by state by state,” he says. “Who opens an e-commerce site only targeting Chicago? It’s very tough.”
It could be a little herb, but marijuana is a big-and increasingly legal-business inside the Usa As of 2018, eight states as well as the District of Columbia have enacted laws legalizing marijuana for recreational use.
Recently, California joined the pot on Jan. 1. In Massachusetts, retail sales of cannabis are required to start out in July, based on Governing.com, a media site covering politics, policy and management for state and local government leaders. Meanwhile, the vast majority of states allow for limited usage of medical marijuana under certain circumstances, Governing.com says.
It’s hard to scale when you are state by state by state. Legal cannabis, hemp and marijuana sales in North America grew 34% a year ago, and they’re slated to grow by an average of 26% annually through 2021, according to ArcView, a study group for the legal marijuana industry. Spending on legal cannabis in the Usa will reach $20.8 billion by 2021 and will generate $39.6 billion in overall economic impact, 414,000 jobs, and over $4 billion in tax receipts, ArcView says.
But for now, the vast majority of that spending by consumers pays for personally, not online. Beyond complex state-by-state regulations, full-on weed e-commerce is also stalled because many cannabis retailers will simply accept cash payments. Banks, many of which are federally insured, don’t wish to risk legal woes from the U.S. government, which regulates banking. Cannabis remains illegal under federal law. This makes bank card payments for cannabis rare.
“Federal illegality impacts [online] payment processing,” Brochstein says. “It’s probable that cannabis could remain federally illegal but that Congress could produce a safe harbor for non-cash payments, however, there is no symbol of that happening soon. Until there exists a payment solution, we shall just have almost e-commerce.”
Cannabis-related e-commerce websites are growing within the U.S., but online sales of marijuana remain out of reach for the time being. Online purchasing, payment, shipping and delivery from the plant is illegal, however many cannabis dispensaries are establishing order online to enable shoppers to peruse inventory before coming into a shop.
Laws vary by state, but eight states as well as the District of Columbia have laws that permit for recreational utilization of marijuana and 29 states as well as D.C., Puerto Rico and Guam have laws allowing medical marijuana use, according lqcwre the Marijuana Policy Project, an expert-legalization organization.
There is no law that explicitly prohibits online sales, but many states have laws that restrict selling and acquiring to specific licensed locations, says Taylor West, deputy director in the National Cannabis Industry Association. West estimates that almost all its 1,200 members have some form of online presence despite the inability to sell online.
Dispensary Diego Pellicer Washington, as an example, lists its location, hours and pricing online, plus it sells cannabis-related products online, including pipes in which to smoke marijuana. Diego Pellicer started selling medical and recreational cannabis in its Seattle dispensary within the fourth quarter of 2016 and expects to generate $ten million in sales in its first year of operation, says co-founder Alejandro Canto. The retailer is in front of schedule on meeting that goal, he says. If online cannabis sales were permitted, Canto estimates that its sales could increase 10-35%.