How the cannabis industry will change in 2023

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What’s Coming to the Cannabis Industry in 2023? As always, there will be frequent changes over the next 12 months. Sales are still ongoing, but companies are struggling. Change is needed – and soon!

Let’s take a look at six ways the cannabis industry could change in 2023 — for better and for worse.

1. Slower Momentum and More Waiting

In 2022, the SAFE Banking Act came so close to crossing the finish line, but it failed again. There is no doubt that efforts to push through banking reform and legalization will continue this year, but as prices fall and market saturation remains an issue, momentum will slow.

Cannabis is the hurry and wait industry and we need to rebuild momentum to enact the necessary changes in 2023. Shifting power structures in Washington, DC could adversely affect the progress of the industry, so persistence will be the name of the game over the next 12 months.

2. More consolidation – but not just how you think

Mergers and acquisitions have been hot topics in the cannabis industry for the past few years, and it won’t stop in 2023 either. However, we’re also likely to see more consolidation among smaller players in the industry to take advantage of the savings at scale.

Small mom and pop businesses that can’t make it on their own may be looking for opportunities to be bought out by Single State Operators (SSOs) or regional players looking to expand their footprint.

3. More clarity about CBD and Delta 8

According to news reports, new FDA rules are coming for CBD and Delta-8 products that could have a significant impact on the companies that make and sell them. It’s possible that the rules will help the legal cannabis industry by reducing competition, but that’s not guaranteed.

For example, companies that can’t afford to comply with newly introduced regulations will have to shut down their stores, and we’ll likely see fewer CBD and Delta-8 brands a year from now. We’ll have to wait and see exactly how these changes will impact the cannabis industry in 2023 and beyond.

4. Rule Changes to Prevent Illegal Market (Let’s Hope)

It is possible for states to realize that their exorbitant taxes and regulations, which discourage rather than encourage business, are helping the illicit market and hurting the legal cannabis industry.

Could tax cuts and other compliance and regulatory changes allow companies involved in the legal cannabis industry to move customers from the illegal market to the legal market? Probably. It remains to be seen whether 2023 will be the year when regulators ease the financial and other burdens placed on cannabis companies. Fingers crossed!

5. Rising interest in consumption lounges

States are finally licensing consumption lounges and locations are opening. In Episode #46 of Cannabiz Media’s Cannacurio Podcast, Jason Kikel, Director of Regulatory Research at Cannabiz Media, said that with the opening of Vegas Experience lounges in Las Vegas, Nevada is likely to become the national leader in consumer licensing.

Additionally, Jason predicts that Chicago could become a national leader as Illinois lays the foundations for an excellent regulatory environment. Denver is another city to keep an eye on.

Also, California is finally showing movement. During the podcast, Jason shared that local governments are allowed to renew lounges, and West Hollywood has already done so with a variety of lounges and experiences.

On the East Coast, Jason expects New York to follow in Las Vegas’ footsteps and quickly begin opening consumption lounges. This year is just the beginning for consumption lounges across the country.

6. Greater focus on lean operations, efficiency and cost reduction

The cannabis industry will continue to struggle in 2023, so we’re likely to see many more companies across the value chain implementing cost-cutting measures. Changes could include building efficiencies in processes, prioritizing a lean operations strategy, and even laying off employees or reducing new hires.

Put simply, 2023 will be a year where winners will rise. The winners will be those companies that execute effective strategies, have strong and experienced leadership, and can make the difficult decisions necessary not only to survive but to thrive in the future.

Key takeaways on how the cannabis industry will transform in 2023

Slower momentum, consolidation, CBD and Delta-8 clarity, rule changes, consumption lounges, and cost cutting are just some of the things that will define the cannabis industry in 2023. Of course, nothing is set in stone, so we’ll have to wait and see. Remember, this is the industry of rushing and waiting.

To stay on top of business licenses and changes along the value chain in the United States and international markets in 2023, subscribe to the Cannabiz Media License Database. Schedule a demo to see how you can use it to achieve your goals this year.