By Marc Brandl
[Note: A version of this article originally appeared in 8th Revolution’s Monthly Playbook – subscribe here]
On election day the Show-Me state and Maryland joined a growing list of US states where recreational marijuana is now legal for adults. In a move that can only be viewed with envy by cannabis operators in New York, state officials have announced an ambitious goal of starting recreational cannabis sales by February 2023.
Missouri voters approved Amendment Five with a comfortable 53% of the vote on November 8th. It’s been only two years since the first medical cannabis dispensary opened its doors on October 17th, 2020. If sales do indeed begin in February, it will be the fastest turn around from the start of medical cannabis sales to recreational sales beginning of any state program by some distance. Arizona quickly converted its medical market to recreational sales after voters approved an initiative in 2020; sales began by end the January but had a mature medical market in existence for many years previous.
What will the new market look like for cannabis operators?
194 medical dispensary licenses approved to operate with 182 currently operational in geographically divided into eight districts around the state. Existing medical marijuana dispensaries will also be first in line to start serving adult consumers with dual licenses. Applications open on December 8th and officials have 60 days to approve or deny.
The Missouri Division of Cannabis Regulation under the Department of Health and Senior Services will also be accepting applications in June of 2023 for 144 micro-business licenses. These licenses will be determined through a lottery system, with priority given to low-income applicants and people who have been disproportionately impacted by drug criminalization.
- A maximum of 62 cultivation facilities and 88 manufacturers will be initially permitted under the law.
- The initiative will impose a six percent tax on recreational cannabis sales.
- Regulators can create rules around advertising, but they cannot be any more stringent than existing restrictions on alcohol marketing.
- Local jurisdictions will be able to opt out of permitting cannabis microbusinesses or retailers from operating in their area if voters approve the ban at the ballot.
Midwestern Cannabis Powerhouse?
Missouri’s medical cannabis program brought in just over $160 M in total sales in its first twelve months of operation and quickly accelerated from there. As of September 2022, another $378 M had accumulated. Projections vary but most expect Missouri to exceed total sales of $1 Billion within three years of adult use sales beginning.
Tourism and out of state residents
Illinois shares a large border with Missouri and since opening its cannabis market consistently reports more than 30% of its sales are from out of state residents from surrounding prohibition states. More than half of Kansas residents live near the border with Missouri with no legal access to cannabis. Iowa, Kentucky and Tennessee fall into the same category. Each of these states has debated and so far turned down the opportunity to legalize medical or adult cannabis – will Missouri’s successful cannabis marketplace show them the way?
Want to launch your business in Missouri?
Arcview Consulting can help. We’ve worked with a diverse range of cannabis license seekers coast to coast, including those who are seeking to be a part of the growing East Coast market., We will work with you through every step of the application process – crafting the SOPs, developing a business plan and go-to-market strategy, fundraising, valuations and strategic transactions.
Are you an existing operator in another state and looking to expand your geographical footprint? Let Arcview Consulting and our partners do the work for you. Our team is efficient and experienced in delivering results.
Contact us today to discuss your plans for Missouri and beyond. Please reach out to our Director of Business Development, Sarah Falvo to schedule a call.