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Uber’s interest in marijuana delivery highlights sector’s potential and pitfalls

You’d think that marijuana delivery executives would quake in their shoes after the head of a ride-sharing giant recently floated the idea of getting into their line of work.

But that apparently wasn’t the case after Uber CEO Dara Khosrowshahi told CNBC last month his company “absolutely” would explore cannabis delivery if the federal government legalizes marijuana.

Rather than fear such a declaration, cannabis delivery executives welcomed it as a sign there’s a national market for the services they’re building.

“When companies like Uber are talking about getting into cannabis delivery, it’s a really good market signal about how ubiquitous cannabis legalization is and also how ubiquitous customer demand is for delivered cannabis products,” said Elizabeth Ashford, senior director of corporate communications at California-based retailer and delivery company Eaze.

“So I think, in that sense, it’s a really good sign.”

But it’s not always been easy for delivery operators.

While state legalization of adult-use cannabis has unfolded at a rapid pace in recent years, distribution by home delivery has been slower, owing to a patchwork of regulations across the country and within states, among other factors.

Profits can be elusive.

About two dozen states allow home delivery of medical cannabis, according to Marijuana Policy Project. (See chart above.)

By MPP’s count, 10 states permit adult-use delivery services – all with unique licensing and regulations.

“The delivery business is difficult to navigate, but there’s a massive amount of opportunity,” said cannabis industry veteran Jesce Horton, the CEO of Lowd, a cannabis production company in Portland, Oregon.

Horton pointed to brick-and-mortar retail’s limitations in the age of Amazon and the boom in online shopping and delivery.

“We see that’s just the way retail is going in general,” he said. “We can look at almost every industry and see how they’re moving more to the online sales type of market.

“And that’s just growing exponentially. I think there’s not going to be any difference with the cannabis industry.”

To Read The Rest Of This Article By Kate Robertson on Marijuana Business Daily

Published: May 07, 2021

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