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New Jersey legal weed entrepreneurs, advocates, regulators and workers say there’s still a lot that can be done to better serve cannabis consumers more than a year after the market opened.
At the NJ Cannabis Insider summer meetup event last week, attendees got to hear from an informative panel of speakers before engaging in serious business-to-business networking over panoramic beach views at the Wave Resort in Long Branch.
I spoke to a handful of insiders who had plenty to say about the current range of products, diversity of ownership, barriers to entry, and what needs to be done to improve the industry for consumers and business owners in the years to come.
The medical market needs more diversity
“We have done a lot of work that has focused on three priorities. First, is to expand the medicinal cannabis program,” Dianna Houenou, chairwoman at the Cannabis Regulatory Commission — the state agency responsible for licensing weed businesses — said during the panel.
“Before the CRC launched in April 2021, we had less than 12 medical dispensaries available for patients to use to get their medicine,” said Houenou.
Dianna Houenou, of NJ Cannabis Regulatory Committee, speaks during a NJCI Cannabis Business Meetup at Wave Resort in Long Branch on Thursday, July 20, 2023.Julian Leshay | For NJ Advance Media
While the market size has grown over the last two years to 44 medical dispensaries and 35 recreational stores, some insiders said that the market has not expanded enough.
They believe at this point in the medical program, there should be more types of products available to patients.
“The current products don’t suffice. We are light years behind where we should be, considering the medical market started back in 2013. Here we are, 10 years later, and we still don’t have suppositories? We barely have a capsule,” said Matha Figaro, owner of But-A-Cake, a Black, woman-owned multi-state cannabis product manufacturer (she recently won the Excellence in product innovation award at the NJ Cannabis Insider business award show for her infused oral strips and baked goods).
“The people with the power need to be in a rush to get cultivators and manufacturers into the market immediately,” said Figaro.
The CRC recently said in a statement that 138 of the 191 new annual licenses they have approved are for manufacturing and retail businesses. It remains to be seen if these new businesses will add to the selection of products available to patients and consumers alike.
Figaro referenced patients that have specific needs for sugar-free edible options, like those recovering from diabetes or opioid addictions. She said the market currently being flooded with sugary gummies doesn’t serve them.
Julius Davis, assistant general manager at soon-to-open Queen City Dispensary in Plainfield, also feels that consumers can benefit from the market expanding to include a wider range of craft-products in the state.
“We definitely want to provide those staple products to the community we are in, but also there are under-serviced products and under-serviced people who are looking for specific things,” said Davis. “They are not being provided with those products.”
He said that as his dispensary prepares for opening in late-August, they are looking for smaller cultivators and manufacturers that are just getting started with crafting products specifically for New Jersey, that reflect the culture and needs in the state.
So far, it’s been hard to find those sources.
“There’s not a large diversity of those products in the state. Right now, it’s a limited selection. We are looking for those products that are less visible in the larger markets —- we want to give everyone a taste of what they are looking for, not necessarily what’s available,” Davis said.
The many barriers to entry
A crowd of attendees listen to Genna Jones, program manager at NJEDA, speak during a NJCI Cannabis Business Meetup at Wave Resort in Long Branch on Thursday, July 20, 2023.Julian Leshay | For NJ Advance Media
There are currently 24 companies licensed to manufacture cannabis in the Garden State, and 35 that are licensed to cultivate.
Victor Guadagnino, head of strategic planning at Canna Remedies, a women-led and women-operated licensed cannabis retail company and one of the sponsors of the networking event, said that the lack of diverse owners in the market is mostly due to the many barriers to entry that small cannabis businesses face.
“We have made a lot of progress in terms of making opportunities for small business operators, but I have concerns over their future success,” said Guadagnino. “We’re coming into a market that has well-entrenched operators. They are vertically integrated, meaning that they have access to their own supply and they control price pressure for themselves and competitors.”
He said that new licensees have many obstacles to overcome in becoming operational, like real estate, funding, supply and navigating the permit processes, both on the municipal and state levels.
“One of the main challenges on the retail side is the lack of municipal support. There are only so many municipalities allowing cannabis businesses, and the ones that do have increased zoning restrictions for weed retail spaces,” he said. “This leads to the hubbing of all these businesses in a single area, increasing competition for real estate. We can’t be geographically strategic.”
Bionda Rizvani, left, program administrator at NJ Business Action Center, and Joseph Forte, deputy chief of staff and chief diversity officer of NJ Department of State, pose at a NJBAC vendor table during a NJCI Cannabis Business Meetup at Wave Resort in Long Branch on Thursday, July 20, 2023.Julian Leshay | For NJ Advance Media
He said that organizations like NJ Cannabis Insider and the New Jersey Business Action Center support the marketplace by equipping entrepreneurs with the proper tools and information to be competitive.
“I really encourage everyone to join those networks, as experienced operators are sharing their knowledge base with those who wants to pursue cannabis retail in this state,” said Guadagnino.
“It’s challenging, but I am hopeful that we will see a fracturing and specialization of the supply chain so that we can truly specialize in different types of products and services,” Guadagnino said. “We will be able to communicate between the storefronts within minutes of each other and differentiate our skill spaces to serve the community in a varied manner.”
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Gabby Warren is NJ.com’s Cannabis Life reporter. She’ll be covering all things weed retail, commerce and culture.
NJ Cannabis Insider is a weekly subscriber-based online trade journal and events group produced by NJ Advance Media, which also publishes NJ.com, The Star-Ledger and other affiliated papers. Are you interested in the N.J. cannabis industry? Subscribe here for insider exclusives. Follow us on LinkedIn. Contact us here.