Mid-Atlantic Cannabis Markets: What to Do While You “Wait”
Update for 2021:
As New Jersey and New York adult-use cannabis license application details are pending, “active waiting” is even more important so you will be ready to compete in these high-stakes markets.
The cannabis world moves fast, though sometimes it feels like “hurry up and wait” while program details get mapped out. This very scenario is playing out in the Mid-Atlantic states with extended consideration and planning — plus increased competition and tightening capital.
If you wait to start planning until your preferred state announces their application date, you’re too late. The best investors, property, and team members are already gone.
The one thing we hear from clients all the time is “I wish I’d started sooner.” – Greg Huffaker, Director of Client Services
Active Waiting vs Idle Waiting
To give yourself the best chance of securing a license in some of the most sought-after markets in the U.S., start now by developing a solid business plan and financial model. With nearly $10 billion in retail spending projected over the next five years in New York, New Jersey, and Pennsylvania, alone, you cannot afford to idly wait.
While regulatory specifics and application processes in each state will likely be different, your business plan and financial model will help you identify funding and personnel needs and line up investment sources.
With the tightening of capital markets for cannabis, the lead time and competition for investment have grown substantially. A good business plan and financial model not only set you up for a successful application, but these tools also make your pitch to investors much more compelling.
What We Expect
The Canna Advisors team has been active in advocacy efforts and helping clients win licenses in previous rounds on the East Coast. While it’s anyone’s guess where the regulatory specifics will land, what we do know from experience is that competition will be very tight, and regulation is likely to be extensive. We do expect to see a limited number of licenses, preferences for existing medical licensees, and provisions for social equity.
What You Should Be Doing Now
- Evaluate your strengths and resources to decide on a business type or market niche.
- Consider an hourly consultation to discuss critical factors.
- Develop an initial business plan and financial model.
- Identify key roles that will need to be filled for your team and begin researching and building relationships with potential recruits.
- Identify how you will fund your business, and if it involves soliciting investment, develop a fundraising plan.
- Research and begin developing relationships with community members, policymakers, and regulators who will be relevant to your business.
Spending Projections – $9.66B in the next five years (2020 – 2024) in New York, New Jersey, and Pennsylvania, combined.
Source: “The State of Legal Marijuana Markets” by Arcview Market Research / BDS Analytics, 7th Edition