Challenges for Cannabis Delivery Operators
While many states have either decriminalized or legalized cannabis, that doesn’t mean those states also allow cannabis delivery.
The patchwork of cannabis-related laws from state to state can be a challenge for cannabis delivery companies. And within each state, laws may vary by jurisdiction. Let’s take a look at the top challenges for cannabis delivery operators:
The image above highlights the challenges of operating a cannabis delivery company with multi-state distribution. States may allow marijuana for medical purposes, for recreational use, or under no circumstances. State laws may also define legally acceptable methods of marijuana usage, the maximum allowable THC content, and whether retail sales are allowed (see the National Conference of State Legislatures “State Medical Marijuana Laws” table for details).
Some state marijuana laws are currently under review in state courts, and with state legislatures on different schedules, it can be difficult to predict how laws may change from year to year. That makes regional or national expansion difficult. However, some ambitious companies are expanding their reach by acquiring cannabis delivery companies in other states.
Licensing may be defined by state or local law and may include different licensing tiers, depending on the nature of the business. In Massachusetts, for example, cannabis delivery companies can apply for one of two types of licenses:
- Marijuana Courier: This allows license holders to earn a fee for delivering cannabis products to consumers from licensed retailers or licensed medical dispensaries.
- Marijuana Delivery Operator: Holders of this license may buy and store wholesale cannabis products, as well as deliver them.
In Colorado, delivery of medical and retail cannabis requires two permits. Even so, a holder of both licenses could easily run afoul of the law, if making a delivery to a local jurisdiction that “has not affirmatively permitted delivery or has prohibited delivery from outside the local jurisdiction.”
Cannabis delivery companies hoping to spread the word about their business may find their options are limited. Federally regulated media — such as Facebook, Google Ads, and network television — cannot allow cannabis delivery ads. And generally, the presence of minors influences how cannabis companies can advertise. For example, in Nevada, cannabis advertising is permitted at entertainment events if it’s reasonable to estimate “that less than 30% of the persons in attendance are under 21 years of age.”
Rather than attempt to advertise without violating federal, state, or local rules, some cannabis companies are focusing their efforts on websites that are designed exclusively for cannabis advertising, shopping, and deals. Notable sites include:
- Weedmaps.com (iOS and Android app available)
- Leafly.com (iOS and Android app available)
Managing growth while staying compliant
Cannabis delivery companies have to comply with a number of regulations and document their compliance, which can be a challenge for companies with rapidly growing delivery fleets. Traditional dispatch management software may not include the features that cannabis delivery companies need, such as real-time driver tracking and proof-of-age verification.
Meeting expectations for medical deliveries
For people who use cannabis for medical reasons, a timely ordering and delivery process is important. But often that process can be inefficient, with patient orders being fulfilled by a dispensary and delivered by an independent cannabis delivery company.
To be continued...