In recent years, state governments have begun easing restrictions about the use, production, and sale of cannabis. Today, the U.S. cannabis industry is projected to reach a $30-billion annual market value by 2025. Cannabis delivery will be an essential part of that market growth.
Last year, as many other market sectors suffered the effects of the pandemic, cannabis delivery thrived. Dispensary operators were quick to adjust their business models, with 79% rolling out curbside pickup and delivery service. By December 2020, cannabis deliveries had increased 300% since the start of the pandemic.
In this ultimate guide to cannabis delivery, we’ll provide an overview of this business sector, the challenges it faces, and how companies new to cannabis delivery can position themselves for success.
The Growth of the Cannabis Delivery Sector
Cannabis sales in the US reached $19 billion nationwide in 2020, but brick-and-mortar dispensaries are illegal in parts of some states. The ability to legally deliver cannabis products has helped retail and medical cannabis companies reach customers in areas where dispensaries are not allowed, and many companies are seeing great gains as a result.
Amuse, a California cannabis delivery company founded in 2020, planned to double its staff of 250 and open two more locations by the end of 2021. Herbarium, another California company, opened its third location in the spring of 2021, with delivery in a 30-mile radius. Sweet Flower, based in Culver City, had plans to add stores throughout the state in 2021, as well as a manufacturing and distribution hub.
Marijuana delivery businesses in other states are also reaping the benefits of relaxed rules. In June 2021, Apple updated its App Store policies to allow cannabis delivery apps, with downloads restricted to states where cannabis is legal for recreational use. This was a huge win for medical marijuana delivery companies that until Apple’s policy update had to manage all deliveries through their own websites.
How Companies Manage Cannabis Delivery Operations
Some cannabis dispensaries are small operations that may not have the resources to fulfill delivery orders. These businesses tend to rely on third-party delivery services, like Blackbird, a Nevada company that delivers products for dispensaries in Reno and Las Vegas.
Larger dispensaries may manage every aspect of operations, including delivery. These companies may have their own in-house delivery management software, or they may use an outside vendor — like Onfleet — to manage drivers, plan routes, fulfill deliveries, and ensure compliance with cannabis delivery laws.
To be continued...