New York could support at least 1,000 licensed marijuana retail stores if the state made it possible crack down on A new industry-backed analysis claims a “measured” approach to crackdown on illegal shops and legal expansion will be implemented.
There are currently 222 licensed cannabis shops open in New York, according to an analysis by Whitney Economics, but if 85% of tipped customer sales were made legally, the Empire State could sustain 1,250 to 1,350.
As things stand, the study states, only 15% of New York’s pot sales are in the legal market due to the large number of illegal storefronts and dealers.
Last year, less than 5% of weed transactions were in the legal market.
“Competition from a strong illicit pop-up market is making legal cannabis retailers compete head-to-head. This is making it difficult to grow revenues and convert consumers into the legal market,” said the report obtained by The Post.
Crackdown on the black market suffered a blow Tuesday when a Supreme Court judge in Queens issued a blistering ruling that struck down a state law allowing New York City to shutter hundreds of suspected illegal cannabis shops. Is unconstitutional.
The city is appealing a ruling that determined the Sheriff’s Office’s authority to shut down illegal cannabis vendors after raiding them violates shop owners’ due process rights.
“Currently, there is more access to illegal cannabis retailers than legal retailers, so it is extremely important for regulators and law enforcement to address illegal competition,” the study said.
“Otherwise, the legal retail sector will continue to struggle and not generate enough revenue to be sustainable.”
Conversely, researchers cautioned that increasing the number of licensed pot stores too quickly could “saturate” the market and put existing cannabis retail operators at a loss or out of business, which California And it happened in Oregon.
“Oregon is oversaturated in terms of both supply and retailers relative to the Oregon market. This is causing economic stress in the market and leading to business failures, the Whitney researchers said.
“It is also creating other problems for the Oregon market. Very few lenders are interested in providing funding in Oregon due to the high risk and low potential for returns.
The report said a “measured” approach to approving and opening licensed shops would have a better chance of maintaining a strong market.
Whitney economists said, “However, the key to successful deployment of licensing depends on how quickly strong illegal suppliers can be displaced and whether rules are implemented that facilitate rather than hinder their market entry.” Help to facilitate.”
Cannabis operators praised the report.
“The future of New York’s cannabis market depends on a delicate balance between regulation, enforcement and market dynamics,” said Osbert Orduña, CEO of The Cannabis Place dispensary in Queens and co-chair of the Service Disabled Veterans at Cannabis Association.
“While the potential for significant growth is clear, our regulators must learn from the mistakes of other states and implement effective strategies to address the challenges of illegal competition and over-licensing.”
“This deep dive into New York, even with its complexities, highlights several points that are universally true,” said Frederick Eastley, president of the Minority Cannabis Association, which commissioned the study. Small business retail owners are in trouble trying to avoid taxation and competing with unregulated markets.
The report said New York’s slow, difficult implementation led to delays of 18 to 24 months in licensing, which “hurt small businesses.”
Governor Kathy Hochul ordered sweeping changes to the state Office of Cannabis Management to streamline operations and speed up the licensing of pot shops.
