Maine’s “User-Friendly” Proposed Regulation Change
Maine’s cannabis regulators have proposed a new set of regulations meant to assist businesses service tourists. Namely, retailers, manufacturers, and cultivators would be allowed to deliver product to hotels and businesses. This would be a substantial departure from the regulatory systems across the US. In some states, like California, cannabis cannot even move from a cultivator to a retailer without passing through a licensed cannabis distributor. Now, if passed, a cultivator in Maine could sell product directly to consumers and deliver them to a commercial location.
It would be suprising if Maine’s retailers were in favor of this change as it would substantially alter how product is sold in the state. Suddenly, the competition for cannabis sales extends not just between retail licensees but now also includes direct sales from the cultivators and manufacturers. These sales will never dominate the market, as tourist revenue is seasonal and limited in scope, but any added competition has to be considered a risk to existing licensees.
Maine recently hit $21 million in sales for a month, setting a new record. Compared to other states, this is a very limited market. If even a few million is diverted out of stores and into growers straight to tourists, that is a major hit to the retail stores. As we have seen elsewhere, the retailers tend to have the loudest lobbying voices. All this being said, this rule change could mean great things for cultivators and manufacturers by allowing them to see direct sales and capture more margin than going through traditional retail channels. It will be very interesting to see how these proposed rules progress.
